August was a record month for new sales listings but there are signs of a market correction.
Analysis by property website Home.co.uk found there were just over 125,000 new instructions entered the UK market last month, which is 25% more than in August 2019.
This is the highest number of new listings in a single month since May 2011.
Overall, the total stock on the market is still down 7.3% annually.
The website said much of the stock for sale is being covered by pent-up demand but warned excessive supply, particularly in London where listings are up 71% annually, is risking a market correction.
Average asking prices are now up 3.8% annually to £320,190, Home.co.uk said
The research found 6% fewer properties on the market were reduced in price last month compared with August 2019 but warned the average price cut is now 8.8% higher.
Doug Shephard, director of Home.co.uk, said: “Supply shocks always trigger a period of price rediscovery.
“This is the case for any market, including the troubled London property market. Prior to the Covid-19 pandemic, the UK’s leading market looked set for a return to growth after a protracted period of price correction.
“Now, post-lockdown, with supply going through the roof, London’s prospects look hugely different.”
Comments (3)
It feels this week as if the pent up demand in Prime Central London has been satisfied and unless you present a property into the popular market (Cheep in other words) there is little interest, no foreign buyers in town but quite a few calls from other countries. Now advising investors who are selling to take a little hit now as opposed to a larger CGT hit after the budget.
In our area, record numbers of listings by agents followed now by record numbers of price reductions!
It all depends if this increase in supply is countered with an increase in demand – it depends if they are selling or not?
…and then ensuring you can get them to exchange jumping over the hurdles of the mortgage companies and lawyers.
These are interesting times