New housing market data indicates that buyer interest is increasing, while prices remain resilient.
Industry analysts had plenty of numbers to crunch last month, with the Bank of England and property portal Zoopla releasing insights on the state of the economy and housing market.
Let’s look at what the figures mean for buyers and sellers.
Mortgage approvals
Perhaps the best news came from the Bank of England’s Money and Credit report, which covered activity in May.
It showed that net mortgage approvals (an indicator of market activity) grew by 2,400 to 63,000.
This increase was the first rise we’ve seen in five months.
Analysts broadly viewed this as a sign that, with interest rates falling and further cuts mooted for later this year, buyers are feeling more confident about the market.
First-time buyers in particular are leading the charge.
Nathan Emerson, Propertymark’s chief executive, described the figures as “incredibly positive news”.
“It is one of the loudest signals of them all regarding consumer affordability, and it is also a massive vote of confidence from lenders in the longer-term prospects of the economy too.”
Richard Donnell, Zoopla’s executive director, said he expected demand for mortgages to continue.
“The market remains on track for 5% more sales in 2025 with price inflation steady at 2%,” Mr Donnell said.
House price growth
Property prices continue to grow, albeit modestly. Zoopla figures reveal house prices grew by 1.4 per cent in May.
Although the base rate has been reduced several times since last August, affordability remains a key concern for buyers.
They may be feeling more confident, but they’re not getting too carried away.
More stock on the market
Zoopla reports that sales activity is running at the fastest rate in four years.
Figures show that the average estate agent currently has 37 homes for sale – up from 32 at the same time last year. This equates to a 15.6% increase in the number of homes listed for sale year-on-year.
If you’re a buyer, this is good news, as it means you have a wider choice of properties to consider.
For sellers, it’s a case of remaining realistic on price.
The number of sales agreed is up 6% on last year, so there’s still plenty of scope to secure a good deal as long as you’re pragmatic.
However, sellers who fail to price their homes appropriately are likely to struggle.
Currently, the average time it takes to sell a property is 45 days. Conversely, one in five homes has been listed for sale for over six months.
Mr Donnell said: “The number of buyers and sellers agreeing home sales continues to increase year-on-year, demonstrating a continued desire of more households to move home in 2025. Improving mortgage affordability will support buying power in the second half of the year.
“However, buyers remain price-sensitive, especially in higher-value markets where the number of homes for sale has grown the most in the last year, boosting choice for home buyers.
“Serious sellers need to be realistic on where they set their asking price in order to achieve a sale and secure a home move in 2025.”
The dangers of over-valuation
One of the biggest drags on a property sale is the failure to get the asking price right from the outset.
It can be tempting when an (unscrupulous) agent gives you a ridiculously high valuation to go along for the ride.
You can get a certain price stuck in your head and start making future plans based on this unrealistic number.
However, thanks to the wonders of the internet, buyers and lenders have a vast amount of sales data readily available to them.
If your demands are significantly out of line with the rest of the market, you’ll only deter genuine buyers and slow the process down.
It’s likely that your property will languish on the market and become what’s commonly known as a stale listing.
When this happens, the only way to get a sale back on track, so you can get on with living your life, is to adjust the price to meet market realities.
Getting your asking price right
If you’re looking to list your home, we suggest getting three valuations.
Don’t just go with the agent who is quoting the highest figure (they may be over-promising to secure your business).
Also consider an agent’s track record in the local area, the quality of their online listings, their innovative use of social media and their professionalism.
If you’d like to arrange a free valuation of your property, contact us today.
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