The arrival of spring and a two-year high in housing inventory suggest the market remained stable in March, according to our latest Property Sentiment Index.
Motivated by the approach of spring, UK homebuyers and sellers kept their confidence steady in March, with hopes to complete transactions within the next three months staying level with February’s figures – 65% of buyers and 60% of sellers were confident in their plans.
- 65% of UK buyers believe they will buy a home within the next 3 months
- 60% of UK sellers believe they will sell their home within the next 3 months
- 45% of homes were under a sale agreement within a month of listing, consistent with last year’s March figures
- Buyers and sellers aim to complete deals before election distractions
Jason Tebb, our President, comments on the March report findings:
March saw a stable housing market, with longer daylight hours, upcoming warmer weather, and the highest property stock levels in two years, all leading to increased market activity. Buyers and sellers have a good opportunity to make their move with interest rates improving, although sensitivity to pricing still remains a concern.
In March, confidence levels among buyers and sellers did not waiver. Buyer confidence nationwide was at 65%, consistent since January, with seller confidence at 60%, unchanged from February. Yet regional differences matter, as shown by buyer confidence dropping by 13 percentage points in the North East, while London sellers saw an increase of 7 percentage points. These fluctuations highlight the need for sellers to consult local agents who understand the local market, especially regarding setting the right price.
National average home prices saw a slight decline in March compared to February. This indicates a shift away from the surging market of the past, as buyers are affected by affordability and are not willing to pay any price. An increase in inventory, along with higher loan costs, should help stabilize prices, which is beneficial for first-time homebuyers.
After the Monetary Policy Committee’s fifth rate freeze in March, the belief is strengthening that interest rates will not increase further and may, in fact, go down. Although borrowers’ concerns over mortgage pricing increased slightly in March, some buyers may be waiting for the predicted rate cut to occur.
Those looking to buy or sell are advised to do so soon, as delays often accompany the uncertainties of election seasons. With one quarter of the year already over, transactions may take longer than expected, and nobody knows when interest rates will drop. A slight delay in favour of lower rates could result in missing out on the best times to buy or sell, as election distractions later in the year could slow down the market.
State of the Nation
This month’s Property Sentiment Index, starting on page 8, reflects continued cautious optimism among agents nationwide, as buyers are conscious of pricing.
Mike Cleary from the West Midlands notes buyers are holding off for a rate cut, expecting better borrowing conditions. In Scotland, David Corrie mentions an uptick in listings and early Easter as reasons for increased seller activity, cautioning on the importance of pricing. Likewise, Andrew Cardwell in the North West observes a cautious yet optimistic sales market, with buyers and sellers eager to proceed, provided the price is right.
You can explore the complete report here.
