What's really driving the UK property market?

The Savills Blog

What's really driving the UK property market?

Whether it’s a growing family or job move, buyers with a strong reason to move are getting on with it.

Whether you’re a buyer or seller, making a start is hard. You want to know you're making the right decision.

It’s sometimes easier to wait. But then next month often turns into next year.

For many people, this is exactly the scenario they have been experiencing for the past three years when considering moving home. However, for a growing number, enough is enough.

“People have played the waiting game, but they need to get on with their lives,” says Liza-Jane Kelly, Sales Director, London Residential. “Whether you need more space for a growing family, or you’re moving because of a new job or to live in a school catchment area, you can only wait so long.

“Life decisions like these are driving the market across all our London offices,” says Kelly. “Since the start of the year, we have had an average 30% increase in buyers registering. As a consequence, there isn’t enough supply to meet demand. In some cases, this is leading to competition and even sealed bids.”

For Jonathan Hewlett, Head of London Residential, there is a looming supply issue at the top end of the London market, too. “We are seeing deals where buyers have a strong need and are paying a fair price,” he says. “Otherwise, for now, people are watching and waiting, although there is a belief that prices have gone as low as they are going to. But what remains clear is that London is still an attractive destination for international buyers.”

Not surprisingly, getting on with your life is a sentiment that echoes around the UK. “The majority of people in the market are driven by a catalyst, be it a growing family or job relocation,” says Andrew Perratt, Head of Country Residential. “The number of new buyers registering with us across the UK has increased around 20% year on year,” he says. “Viewing numbers have gone up by a similar amount. However, there are fewer properties.

“This is a pattern we’re seeing across the UK, but there are regional variations. Parts of the North West and Scotland, for example, are on an upward trajectory which is why I always recommend seeking advice from our local office teams who understand the hyperlocal conditions as well as the broader picture. The key to a successful sale is getting the asking price and sales strategy right.

“Although needs-based buyers are driving the market, some overseas buyers are making the most of favourable currency rates. Some expats, for example, are buying now as part of a future return.”

Despite all the uncertainty, Perratt is optimistic. “There have been tougher markets than this,” he says. “For many buyers, the biggest difference now is that mortgages are cheaper and easier to arrange.”

So, given the market, what advice do they have?

“You never get a second chance at a first impression,” says Hewlett. “From the photos, to the walk to and through the front door, everything must look at its best.

“The pricing must be fair. Buyers can look up local sales figures and they won’t even bother making an offer if they think you’re being over ambitious. They don’t believe there will be a sensible conversation.”

“If you’re buying, get your finances confirmed in good time,” says Kelly, “It gives the seller confidence that you’re prepared and ready to get the deal done. The same goes for having a good solicitor lined up and raring to go. It’s important to be organised: we are seeing a lot more chains because, these days, people are reluctant to arrange bridging finance or rent out their property.”

Perratt concludes “For people who need to get on with their lives, now is a good time to start".

 

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