Record low stock levels combined with high demand have created a perfect storm for bidding wars to break out. A record 36% of sales in Q1 2021 nationally had an offer on the table from three or more buyers. While 18% saw offers from five or more.
An imbalance between demand and supply has fuelled competition in the market. There were twice as many applicants registering to buy in March than during the same month last year, but 19% fewer homes available on the market.
Scotland was the most competitive market where 65% of homes sold in Q1 2021 received bids from three or more prospective buyers. Six of the top ten local authorities where bidding wars were most common were in Scotland, with Stirling topping the list where 76% of homes received three or more offers from different parties.
Higher stock levels in the capital meant just 26% of homes sold in Q1 2021 saw offers from 3+ buyers, the lowest level in the country. London is the only region in Great Britain where there were more homes available to buy in the first three months of the year compared with the same period in 2020. Despite this, Barking & Dagenham, London’s most affordable borough, sat in sixth place where 69% of homes sold in Q1 2021 had an offer on the table from three or more buyers.
Post pandemic lifestyle changes have driven buyers to search for more space, with many heading to rural areas. Country markets were the most competitive, with 40% of homes sold in Q1 2021 receiving more than three offers, up from 29% during the same time last year. Meanwhile, 31% of homes in cities and 36% of homes in small towns and suburban areas had three or more buyers competing for them.
As a result, more homes are selling above their asking price. 28% of homes in England and Wales were sold for more than their initial asking price, the highest proportion since our records began and up from 19% during the same period last year.
As nearly always has been the case, it is likely the strength of the market will tempt more people to put their home up for sale. This means that over the second half of the year we expect stock levels to increase meaning home hunters currently struggling to find the right home are likely to get more choice.