Leather on willow, a dawn chorus to wake you from your slumber, torrential rain lashing down unexpectedly — these are the sounds of spring.
Historically, one might have included the knocking of ‘For Sale’ signs into the ground as the UK property market kicked into seasonal life. However, given the nature of supply, there would have been many of us wondering if that would be the case this year.
We’re all acutely aware of what low levels of housing supply mean to our market, especially when there is rampant demand. Just look at any recent house-price index and you’ll see ongoing double-digit growth.
No one was expecting this year to follow the trajectory of 2021
While that may be welcome for existing home-owners, it’s simply not sustainable and not desirable for a market that needs new blood and a feasible level of purchase activity. Our market cannot live by remortgage and product transfer alone.
Ray of light
There has been a recent ray of supply-focused light via the Royal Institution of Chartered Surveyors’ (Rics) Residential Market Survey, which revealed a much-needed rise in the number of new homes listed for sale during March.
Plus 8% of surveyor respondents reported more properties coming onto the market — the first time there has been such a positive indicator over the past 12 months, and hopefully a sign of things to come because, as a sector, we undoubtedly need more property availability.
That said, as the Rics survey also reports, the number of properties on estate agents’ books remains close to historical lows, and new-buyer enquiries rose by 9%.
So you can see that, while there is a close match, demand still outstrips available supply.
Our market cannot live by remortgage and product transfer
However, there is further positive news. Sales expectations for the next three months remain positive at plus 16%, although you might credibly ask, ‘Why wouldn’t they?’ when there is still an extremely strong level of demand to buy.
Overall, any improvement in the supply of properties for sale is news to cheer, especially given the wider economic issues around the cost-of-living increases that are fuelling big rises in inflation, and what that may mean for household income.
You might have thought such pressures would mean potential homesellers were less likely to come to market during a period of flux. But hopefully that is not the case and there will be a greater supply, rather than just the bare bones of those who need to sell due to death, divorce and distress.
As always, it is about making the most of opportunities and steering all clients through the process
For advisers, there is continued strength and resilience within the remortgage and product transfer market, which will deliver business levels. But a greater amount of purchase activity could make all the difference in terms of income and profitability; especially after a year — 2021 — when the purchase market was so phenomenally strong.
Ancillary opportunities
No one was expecting this year to follow the same trajectory, but more supply will mean more sales and, as advisers, if you can secure a fair share of that business then you will also have significant ancillary business opportunities, be it in the shape of protection, general insurance, conveyancing, legal services or the like.
There is continued strength and resilience within the remortgage and product transfer market
As always, it is about making the most of those opportunities and steering all clients through the process.
This will not only ensure they secure the mortgage finance they need but also give them the certainty and confidence to not go elsewhere for other services.
As a result, they will keep returning to you whenever they need trusted advice, year after year.
Mark Snape is chief executive of Broker Conveyancing
This article featured in the May edition of MS.
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