Now that we’re clear into February, I thought we’d take a closer look at the market across the UK since the turn of the year.
The below table shows the volumes of new instructions and sales agreed for the whole of January, compared with January in each of the previous years back to 2019.
What we can see is that New Instructions coming to the market are up 4.3% on 2021, whereas after 14 days when I last updated on this, we saw a 2% fall in supply to the market.
We’re still some way off the last “normal” year of 2019 though – almost 17% down. But the market has changed a fair bit since this time.
The number of buyers in the market are down 17% on last year, which shows that we are maybe returning to much more of a “normal” situation within the housing market where historically, demand is roughly 75% of supply. January this year, demand as a percentage was 79%.
Demands is still up 3.5% on January 2019, showing that with the market looking like it’s returning to previous levels, and with the worsening economic outlook, underlying demand is still strong for property.
Sales Market Winners and Losers
There are two key differences in the properties that are coming on to the market ‘For Sale’ today compared to 2019:
- Property coming to the market in January 2022 is more likely to be flats than houses – in fact 16% more likely! Today, 27% of all property listed for sale in the UK is flats
- Much more importantly, the geographical distribution has changed. Property coming to the market now is much more likely to be in Central London and much less likely to be in the South West.
This is great news is you’re looking to buy a flat in London, but not so good if you’re looking to buy a house in Devon.
This table shows the Lettings market through January 2022 compared again to the past few years:
What you can see from this is that new instruction volumes continue to fall by over 11% on last year. And perhaps more importantly, volumes are far short of the last “normal” year of 2019, with a fall over nearly 32%!
Demand volumes in the lettings market have fallen 12% compared to 2021 and are 24% down on 2019.
Encouragingly though, demand for rental properties is falling less than supply and whilst it is not as strong as it was, this is a good sign.