In 2019, 7% of homes across Great Britain were sold off-market, with this proportion ticking up over 2020 and 2021 until it hit a five-year high this year, with one in 10 properties being sold this way.
Outside the capital, the share of properties changing hands off-market reached a record high in 2022. This year, 57% of all secret sales have been outside London, up from 49% in 2019 and 45% in 2015.
Off-market sales have traditionally been reserved for the most expensive properties, where privacy and discretion are important considerations. There are several reasons for their recent adoption in the mainstream market, including a desire from sellers to have greater control over the flow of people coming into their homes during the height of the pandemic. Also, houses outside London were selling so fast during the Covid-induced race for space that there was no time – or need – to advertise them widely.
Yet, at the same time as homes outside the capital have been accounting for a greater share of off-market sales, the proportion of homes sold discreetly in London almost doubled this year to 20%, from 11% in 2019. For London homes costing over £1m, the share sold off-market has increased to 28%, from 18% three years ago.
In contrast to the factors behind the increase in off-market sales outside London, the uptick in the capital is likely to have been caused by the slower property market. There, sellers have been more likely to use off-market sales as a way to “test” the market and their asking prices, without having to publicise any reductions or reveal how long the property has been for sale.
The figures for off-market sales have now started to be revised downwards so, even though numbers are still up compared to this time last year, they are probably just past their peak.
It is important to note too that these numbers show the proportion of homes sold which remained off-market for the entire transaction. Of course, there are other properties which start out being marketed privately and, after they fail to sell in this way, are advertised more widely.
If the market continues to slow, as is widely anticipated, it is likely that we will see more homes that start out off-market to test the water come onto the wider market in 2023.
