2018 review from agents shows fewer first time buyers and landlords
There were fewer sales to first time buyers and more landlords left the private rented sector in the UK, according to the 2018 review from estate and lettings agents.
Over the course of 2018, demand was lower than last year with members of the National Association of Estate Agents (NAEA) reporting an average of 324 house buyers registered per branch, compared to 366 on average throughout 2017.
However, looking back over the last 10 years, the numbers are up by 31% from 222 per branch in 2008.
The number of properties available to buy hasn’t changed drastically year on year, with 38 available per branch throughout 2017 and 39 in 2018, hitting a two year high with 46 in September. However, supply has dropped significantly over the last 10 years, from 89 on average per branch in 2008.
The number of sales agreed per branch throughout the year fell in 2018, from nine on average per month in 2017, to eight this year. Historically, this figure has remained fairly consistent, only moving between 12 and seven from 2008 to now.
Despite the fact first time buyers benefitted from stamp duty relief in 2018, the proportion of total sales made to the group fell by 1% year on year from 26% on average in 2017 to 25% in 2018.
‘It has been a busy year for the property market, with the Government launching several consultations to address important issues, most notably to regulate the sector, improve the buying and selling process, and address the issue of leaseholds,’ said Mark Hayward, NAEA chief executive.
‘The housing market has notably slowed, particularly over the last couple of months, which could be a by-product of Brexit uncertainty, as buyers hold off on purchases until the outcome is clear,’ he added.
The Association of Residential Letting Agents (ARLA) reports that the supply of rental accommodation dropped slightly in 2018, from 189 on average per branch in 2017, to 187 this year. It reached an annual high in October, when letting agents were managing 198 per branch.
In line with this, as landlords continued to face legislative change, the number of buy to let investors selling their properties increased from an average of three in 2017 to four in 2018. In April and May this year, the figure spiked to five per branch, the highest since records began in 2015.
The number of tenants experiencing rent hikes also increased this year from 25% each month in 2017, to 28% on average this year.
Agents reported a spike in the number of prospective tenants searching for homes in July, when 79 were recorded per branch, compared to 68 on average across the year.
‘The number of landlords exiting the rental market is rising, and those who aren’t worried about it yet, should be. Buy to let investors have faced a huge amount of legislative change over the last 18 months alone, and as costs rise, they are being driven out of the market and new ones are being deterred from entering,’ said David Cox, ARLA chief executive.
‘The Government is developing a joined-up approach for legislating the private rented sector, but until this has been put into action and the market is made more attractive for landlords, rents will continue to rise, competition will intensify, and tenants will continue to suffer,’ he added.