The latest Hometrack UK cities index by Zoopla shows:
- UK house price growth hits two-and-a-half-year high
- High demand over the summer has created a sales pipeline that is 50% bigger than a year ago. There are 140,000 more sales in the system than usual creating operational pressure on lenders, valuers and conveyancers
- The flow of new demand is starting to moderate, returning to pre-COVID-19 levels, although still > 40% higher than a year ago
Matthew Cooper, Founder & Managing Director of Yes Homebuyers, commented: “While a 50% annual uplift in the number of sales currently progressing through the pipeline seems like a positive for the market, it is, in fact, causing it to buckle at the seams. Not only are we seeing a higher level of homebuyers rush to buy when compared to last year but a combination of furlough and redundancies means we’re seeing a significantly smaller workforce try to service them.
“The result is some pretty hefty delays completion times across an industry that was already pretty lethargic at full strength and this will have implications further down the line. We expect once many buyers realise the chance of a stamp duty saving is slipping through their fingers there will be a large degree of renegotiations and sales falling through. Given the current volume of those potentially in line, this is likely to bring a chaotic few months for the UK property market.”
Director of Benham and Reeves, Marc von Grundherr, commented: “We’re finally starting to see the market pause for breath after what has been an extreme number of months where the sheer level of market activity is concerned.
“With Christmas now on the horizon, a more muted level of new market activity should remain the case until we see in the new year.
“That said, demand remains higher than last year’s Brexit blighted levels and the job is far from done for the UK property market with the transactions of many buyers still hanging in the balance.
“Those expecting a slow and steady saunter into 2021 are in for a shock and it would seem as though the COVID market chaos of recent months may only be the tip of the iceberg.”