The Supply Squeeze In The Housing Market
The number of properties for sale in the UK has fallen by half since this time two years ago (October 2019). One of the reasons is that many buyers feel overwhelmed and fearful they will be made homeless if they sell their home and can’t buy another. So, we have decided to look again at the facts and give them to you in greater detail in this article.
My research has found the number of Properties for sale started to decline last autumn (2020). The average UK estate agency office now has around 16 properties on their books to buy, compared to 43 a couple of years ago.
So why is this an issue? Many homeowners are wanting to move home and are worried they will put their current home on the market, it sells quickly and then be unable to find another home to buy – thus they believe they will then be making themselves homeless.
The fact is that most homebuyers need to sell before they can buy their next home, meaning they need to place their property on the property market before they can buy their next home.
Yet because of the low supply of properties for sale and the current high demand, there is an imbalance in the property market. This means some house sellers are nervous to put a ‘for sale’ board outside their house.
But properties are coming on to the market all the time, yet the buyers have got to be in the game, in it to win it so to speak. If you keep looking at properties, without even having your property on the market, let alone sold (subject to contract), then you will fall into a self-fulfilling prophecy of not being able to buy another home and will always be chasing your tail.
And it’s those magic words of “subject to contract” that is your get-out-of-jail card.
The average time is taken from agreeing on a sale to it being legally binding (i.e. exchange of contracts) is about 19 weeks.
During those 19 weeks, you are ‘sold subject to contract, which means you have four or five months to find your new home and the likelihood of not finding your next forever home is very small.
And even if you can’t find it anywhere, you will never be homeless as the sale is not legally binding until you exchange contracts, so you can withdraw from the sale up to that point, without penalty.
One final word of advice to all home movers.
Around 6 in 7 homebuyers could have missed their ‘forever home’ in 2020/21.
Let us explain, in a study of various UK estate agents 84.8% of homebuyers were not on the estate agent’s mailing list before they contacted the agent to view the home according to Denton House Research.
Yes, 6 out of 7 buyers (84.8%) waited until the property came on to the market on one of the portals (e.g. Rightmove, Zoopla or On The Market) before asking to view it. But would it surprise you that depending on the location and type, up to one in five houses don’t actually make it onto the portals for sale?
This means if the homebuyer hadn’t registered themselves on the agent’s mailing list, they would’ve missed out on their ‘forever home’, because they would not have known the property was for sale until it was too late.
If you are considering selling your home, you can try our free online valuation tool that provides an instant estimation of your property.