Off market sales grow in high demand UK property areas

Created: 02 Aug 2022

The level of competition for larger homes in commuter towns and villages across the UK is accelerating the utilisation of off-market sales as a means of transacting high value properties. Whilst there has been a marginal decline in one-bedroom home delivery and completions, this has been supplanted by significant demand for prime urban and suburban real residential estate assets.

With demand exceeding supply an abiding theme of the UK residential property market, private sales are increasingly moving into the mainstream from the niche fringes of luxury real estate. In London, off-market sales grew to 23 per cent of total sales, an increase from 20 per cent in 2021, whilst for the prime country property market, this grew to 24 per cent according to estimates by Hamptons.

Despite interest rate concerns, buyer appetites have soared for homes that offer outdoor and green space, as well as quality local amenities, giving rise to bidding wars and sealed bids. Sellers achieved 99.5 per cent of asking prices for off-market homes sold, as opposed to 99.1 per cent for openly marketed homes. With buyer interest so high, sellers are experimenting with alternatives, including property portals and estate agents to maximise value and convenience.

This is set to be buoyed by new mortgage product innovation in the market, such as zero deposit mortgages by providers such as Proportunity, which offer alternatives to the Help-to-Buy (HTB) scheme due to end in 2023. This closure is due to leave a significant £4.4billion funding gap when the scheme ends in October, with HTB widely viewed as exacerbating a decline in one-bedroom homes in favour of larger properties.

One-bedroom property construction starts are down 17 per cent annually, with a 12 per cent reduction in completions over the course of the last five years, according to research by Unlatch. Relative to a 10 per cent increase in properties built across the market as a whole annually, this represents a unique decline for this segment specifically, in part owing to the heightened affordability of larger homes through HTB.

“Using data from estate agency Savills, we found the villages which have recorded the biggest price rise in homes sold since the pandemic. The figures show the change in value of an average home sold in the two years before the first national lockdown compared with the two years since. They do not represent average house price growth in the area – as a handful of large, expensive properties can skew the average – but rather the huge rise in property wealth in the area as buyers chase more space.”

https://www.telegraph.co.uk/property/house-prices/parish-property-safe-havens-where-house-prices-show-no-sign/

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