The TwentyCi Property and Homemover report for Q1 said that while transactions and price increases did not align with volumes seen between 2020 and 2022, “a re-calibration was always likely”.
It added: “In reality the property market has demonstrated a robust performance against significant and determined headwinds.”
Across the UK, sales agreed came to 269,506 which was 7.5 per cent lower than Q1 2019 and so far, 70 per cent of the properties listed have been sold.
TwentyCi said this meant most properties were selling and maintaining price gains.
Return to inner cities
As for sales trends, TwentyCi said the “flight to rural and remote” areas trend seen during the pandemic was starting to reverse.
The data analyst firm pointed to the sales in inner London, which was 5.8 per cent up on 2019.
TwentyCi said while the capital was the slowest to recover right after the pandemic, it was now the “most robust” region as the strong US dollar motivated purchases from foreign investors and the remote working trend reversed.
The North East saw the biggest uplift in agreed sales at seven per cent, while Scotland saw a small increase at 1.4 per cent.
Other regions recorded by TwentyCi reported a decline in sales agreed when compared to 2019, ranging from a drop of six per cent in the South East to a fall of 15.3 per cent in the East Midlands.
The firm said although the South East is the “powerhouse and bellwether” of the property market, the decline in sales did not signify that the market was in freefall but rather suggested a recalibration.
Residential stock in good shape
New instructions fell annually in Q1 to reach 401,587.
However, TwentyCi said the level of available stock was only nine per cent down on “historical norms”. The report noted that almost all regions in the UK had at least three months of residential housing stock to sell.
It said there was a “significant injection” of new supply which came to the market in March, which coincided with returning consumer confidence.
Fall throughs rose by 6.15 per cent to 63,970, compared to 60,265 during the same period in 2019. Meanwhile, withdrawn transactions totalled 172,080, which was 9.7 per cent down on 2019.
Colin Bradshaw, CEO of TwentyCi, said: “As the dust settles from recent shocks, the residential market is emerging in remarkably robust shape. Whilst doomsday scenarios can’t be ruled out, it seems there is room for that old phrase ‘cautious optimism’.
“As energy prices ease and interest rates and inflation look set to be near peaks or trending downwards, stable or upside scenarios have certainly started to look more credible.”
Rental sector under stress
TwentyCi said the rental sector was going through “significant stress” as new instructions dropped by 24 per cent and lets agreed fell by 11.5 per cent.
The firm said this was due to landlords exiting the sector in light of tax and regulatory changes.
The average monthly rent sat at £1,651 in Q1, which was £300 higher than 2019.
The firm said apart from inner London, all regions had less than one and a half month’s worth of rental stock available.
TwentyCi said: “With interest rates having further scope to rise and a squeeze on the availability of mortgages, particularly buy to let, compounded by the fiscal and legislative changes, it has made it less enticing to be a landlord. An improvement in supply appears unlikely in the near to medium term.”
