Demand For Property Is Rising! (Market Update May 2024)

Our MD Mark discusses why demand for property is rising and why it's too simple to say house prices aren't recovering, when, certainly in specific areas, there are reasons to suggest an upward trend In house prices and the housing market more generally!

Manning Stainton

Demand is rising!

The month of April is an important one in the housing market. A real temperature check on where we are at with demand especially.

Using data from TwentyEA which looks at whole of market activity we can see that across the entire region we cover at Manning Stainton there were:

  • 1,260 properties placed under offer in April which is 16% higher than last year.
  • This compares to a 7% increase in the number of new properties coming to market.
This suggests that demand volumes across the market, as expected have continued to improve which is good news.

  • Just to tie in with this view we can add that the number of viewings being carried out across our business increased by 20% in April this year compared to last which is big increase.
So how can this be the case?

After all we heard just this week from various media outlets that mortgage rates are on the rise with three of the biggest UK lenders putting rates up and house prices are falling according to the Nationwide.

And I say… perhaps not surprisingly don’t trust the media!

Let's first of all look at mortgage rates. Yes some lenders have put rates up but there are two things which effects fixed rate mortgages.

  • The first is the 10 year gilt rate which I have mentioned before on these videos and as you can see from this chart we have seen very little fluctuation in this over the last few months.
So if it isn’t that what else could it be.

  • Well the second is demand for a mortgage lenders services. With such a significant volume of activity across the market as there has been this year so far lenders will be inundated with new applications. And when they need to turn that demand down whats the easiest way to do that? Put up prices!
And this in our view is what has been happening over the last week or so.

And what of prices…. Well again I have said many times in these videos that you need to be mindful that when a price index is released whether that be the nationwide, Halifax or land registry these are based on completed sales and so a price fall today reflects sales agreed 4 or 5 months ago.

Our feeling is quite different and whilst the market is certainly not booming in price terms there seems to be some pockets of improvement. Overall this led to a 3.6% increase in the price of property where a sale was agreed in April compared to last year.

And if we look at RM’s asking price index they seem to suggest a similar trend with a 1.1% increase in the average price of property coming to market this month.

Upcoming expectations

Looking ahead we simply expect more of the same. A busy end to the Spring and start to the Summer market with a surge in demand in an environment where there is still a relative shortage of property to meet that.

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