Record number of homes receive multiple offers

MAY 2021

As time goes on, more and more evidence emerges showcasing the strength of the property market.  The latest data from HMRC showed that there were 177,150 property completions in March - the highest number recorded in any month in more than fifteen years - or since Robbie Williams topped the charts with ‘Radio’.  This was partly driven by the rush of buyers hoping to complete ahead of the expected ending of the stamp duty holiday.  But it seems this momentum has continued into April and May too.

Demand remains robust.  Last month there were 20% more applicants registering to buy a home than there were in April 2019.  On the back of greater availability of mortgages requiring smaller deposits, first-time buyers led the charge, with registrations rising by 39%.  However, there are signs of the second home craze weakening, with demand from second-home buyers falling 4% compared with April 2019.

Stock remains short.  With 13% fewer new homes coming onto the market than in April 2019, the number of homes available to buy remains at a six-year low.  The stock shortage remains most acute in rural areas. There were 24% fewer rural instructions during April 2021 than in April 2019, compared to a 9% fall in towns and a 7% fall in cities.

A lack of choice has meant that a record 41% of homes sold in April received offers from three or more buyers.  Scotland remains the most competitive market, where nearly half (48%) of homes sold received three or more offers.  Meanwhile the East of England, South East and South West sit bottom of the list.  But even so, three in ten homes sold in these regions last month received bids from more than two buyers.

Homes are also selling faster than ever before.  Last month the average home in Great Britain took 23 days to sell, making April the fastest single month to sell in the last decade.  The average seller had an offer on the table within 17 days of coming onto the market, compared with 26 days in April 2019.  Homes selling in the North West were quickest to receive offers, taking 11 days on average.  Meanwhile, properties in the North East and London were slowest, taking 25 and 24 days for a first bid respectively. 

April marked the first month on record that the average seller achieved 100.0% of their asking price. The average vendor in 4 of the 11 regions in England & Wales achieved more than their first asking price during April. Vendors in Yorkshire & Humber, North West, East Midlands and South West all achieved more than 100% of their asking price.  Meanwhile, sellers in the North East and London are least likely to sell their homes for the asking price.

All of this means that house prices continue to rise.  The latest data from the ONS shows that prices across Great Britain rose 10.3% annually in March, fuelled by low stock levels.  But low stock tends to be self-regulating in that price growth often tempts new sellers into the market.  As and when more new homes come onto the market over the next few months, we expect to see price growth soften a little and househunting conditions return to something that looks a little more normal.