Sentiment among movers is proving to be remarkably resilient despite the recent hike in mortgage rates, inflation, and volatility in house price growth.
Despite considerable challenges created by the persistently high cost-of-living and consecutive interest rate rises, the house-buying public appears reassuringly resolute when it comes to their home moves, according to OnTheMarket.
OTM’s Jason Tebb said: “Of course, it all depends on how much people are motivated to buy or sell in the first instance, with anecdotal evidence suggesting that the more indecisive are using current market uncertainty as a reason to sit on their hands and not make their move until the outlook is clearer.
“Meanwhile, those serious about moving are pressing on, keen to make decisions and get deals done. Our data shows that confidence levels remain pretty constant, up slightly on last month [n June, 74% of UK buyers were confident that they’d purchase a property within the next three months compared to 73% in May], or down slightly [64% of UK sellers were confident that they’d sell within the next three months in June compared to 65% in May].”
Tebb believes it is “pretty impressive” that almost half of all properties – 43% – were Sold Subject to Contract within 30 days of first being listed for sale in June, a slight improvement on May’s 42% – based on OTM’s data.
Admittedly, this is way off where we were this time last year (60% in June 2022) but the housing market was very different then, one of the busiest since records began, with less stock available and sellers in the driving seat.
He continued: “There are regional outliers, as there is no such thing as a single housing market. While some regions haven’t witnessed much change in seller sentiment, in others there has been a marked shift with sentiment declining in Wales [a six percentage-point drop from 66% in May to 60% in June], the East Midlands [a seven percentage-point drop from 65% in May to 58% in June] and an eight percentage-point fall in the East of England [from 64% in May to 56% in June].”
In the case of Wales and the East Midlands, where average property prices are below the national average and therefore more likely to attract first-time buyers, first-time sellers on modest budgets themselves may be more concerned than most about higher borrowing costs and the impact these will have on their sale.
Tebb added: “While there is still much uncertainty, it’s unlikely that we’ll return to rock-bottom interest rates in the near future. The highly leveraged may have to cut back on discretionary spending more than those with substantial equity in their properties, but while further rate rises can’t be ruled out, the UK public seems to have developed a thick skin over the past year. Despite all the ups and downs, those committing to moving are still doing so.”
