Property prices booming amid buyer frenzy and shortage of stock

Property website Rightmove says it has experienced its busiest ever first half of a year – pushing the average price of property coming to market to a new record high for the fourth consecutive month and £21,389 or 6.7 per cent higher in just six months.

It says the 2021 “buyer frenzy” reveals a 225,000 shortfall in the number of homes for sale.

Tim Bannister, Rightmove director of property data, said: “We predict the number of completed sales will be the highest ever seen in a single month.”

Rightmove expects the number to reach 800,000, beating the record of 795,000 set in 2007.

Mr Bannister said: “This means it’s likely the first half of 2021 has seen a record number of moves compared with the first six months of any other year, induced by the coronavirus pandemic’s side-effect of a focus on what one’s home needs – that is one of the driving forces behind four consecutive months of record average property prices.

“New stamp duty deadlines for sales completed before July have also helped exhaust stock for sale and concentrate activity.

“This has left prospective purchasers with the lowest choice of homes for sale we’ve ever recorded, continuing price rises and stretched affordability.”

Biggest imbalance

Rightmove said the first half of 2021 saw 140,000 more sales agreed, but 85,000 fewer new listings than the long-term average, leaving a shortfall of 225,000 homes for sale.

It said homes with four or more bedrooms faced the biggest imbalance with a 39 per cent surge in sales and a 15 per cent fall in homes to market, compared with 2019.

Marc von Grundherr, of estate agent Benham and Reeves, said: “The market continues to defy expectation, with prices reaching another record high, despite whispers of a decline as a result of the stamp duty holiday deadline.

“There’s no doubt the holiday has been the catalyst for this performance.

“However, it isn’t the driving factor behind the intent to purchase for homebuyers, so a robust level of activity will remain long after it has expired.

“When you couple heightened demand with a severe shortage of stock, it’s likely values will remain buoyant for the remainder of the year, at least.”

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