The UK housing market showed signs of resilience in July, with sales activity holding up and rental demand continuing to far exceed supply, according to the latest Housing Insight report from Propertymark.
On the sales side, estate agents reported an average of 10.1 transactions per branch in July, up from the previous month, while market appraisals – a forward indicator of supply – also rose.
The number of homes achieving their asking price doubled to 10%, though stock levels remained flat at an average of 39 properties per branch.
Around 36.6% of sales took longer than 17 weeks to complete, down from a peak of 41% in 2022.
BOUYANT MARKET
Buyer demand softened slightly, with new registrations per branch down to 65, but Propertymark said overall activity remained “buoyant” in the face of wider economic uncertainty.
Nathan Emerson, chief executive of Propertymark, says: “Despite the number of buyers coming to market taking a slight dip this month, the overall number of transactions and appraisals remains buoyant, indicating that consumer confidence is not shaken by wider economic factors.
“With interest rates improving slightly, this should also be playing a key role in improving home movers’ affordability.
“With speculation circulating regarding potential changes to stamp duty in England and Northern Ireland, we encourage the UK Government to focus on reviewing current rates and bands rather than targeting higher-value properties, ensuring they align with rising property prices.
“Historically, reducing or removing property taxes has led to increased transactions, which in turn stimulate spending and drive broader economic growth.”
RENTAL PRESSURE
In the lettings market, the number of new tenants registered per branch jumped to 82 in July, with demand averaging more than six applicants for every available property.
The number of homes to let edged up to 13 per branch, and 12.18 new tenancies were agreed on average. Rents were broadly stable, with 58% of agents reporting no change, 27% seeing increases and 13% a fall. Arrears remained steady at 2.7%, while average void periods stood at 3.2 weeks.
But Emerson warns that the private rented sector remained under acute pressure: “The same picture is continuing in the lettings market, despite marginal positive increases in the number of properties available and fewer renters competing for a home; current supply levels do not combat the fast pace of demand.
“Those working within the private rented sector continue to voice their concerns surrounding landlords withdrawing their homes from the market, and with recent talks regarding the UK Government’s ambition to tax landlords even further, this news is creating a worrying backdrop at a time when investment is desperately needed to help house the nation.”
BALANCING ACT
Phil Spencer, founder of Move iQ, adds that the market remains finely balanced. And he says: “The overall sales market is complex, with factors like high interest rates, economic uncertainty, and increased supply contributing to affordability issues and leading to some price reductions and longer selling times.
“However, with interest rates edging down a bit, it’s becoming a little easier for people to afford their dream homes or move up the property ladder.
“On the rental side, the market remains competitive, which has played a major part in high rent levels, and many renters continue to stay put in their current homes in fear of being unable to find somewhere else.
“If this trend continues and landlords continue to pull their homes from the market, this is only likely to worsen.
“The UK Government needs to be tactical in its future decisions when looking to fill the black hole in the public finances, and not worsen current housing issues, as any additional financial constraints on landlords could have huge irreversible effects moving forward.”
