Why Are There So Few Homes For Sale In East London?
10th February 2022
10th February 2022
Throughout London, no matter where you look and even with a wide search range of say 3 miles, there’s typically just a trickle of homes hitting the market each week. And within a matter of a few days, they’re snapped up, often over asking price.
Some buyers, totally frustrated at the lack of properties to even view, have resorted to sending letters to homeowners on streets they like desperate to try and tease a homeowner onto the market.
Whether it be East Ham, Hackney or Walthamstow, I speak to many a buyer in rented accommodation simply seeking a home of their own in understandable despair at ever increasing prices. Some are reassessing plans and considering a move further afield.
Giorgia Siria, a buyer I’ve been dealings with for months is finding house hunting dispiriting and speaks for many. "We started house-hunting at the end of last summer, with big dreams of finding a forever home for our pets, our fig tree and space for our many creative hobbies, excited about investing in a new community. But there are so few houses available and buyers are having to make offers outside their comfort zone in an attempt to secure a home."
Like many estate agents, I’ve never had so many buyers on my books wanting to buy. It’ll be the same with many agents. But the supply of properties coming to the market has never been lower.
In January 2022, there were 350,000 properties for sale across the UK. 36% lower than at the start of 2020 and the lowest number of available homes for sale for some 15 years. (Source – residential research consultancy TwentyCi).
This is echoed by prospective buyer Jamin Kapoor who tells me "The most difficualt aspect of buying a home at present is the total lack of stock. And for those that do come up, there always seems to be an offer over and above the asking price. We’ve also struggled with gazumping."
How has this happened?
Demand was understandably turbo charged following the demise of lockdowns and Rishi Sunak’s arguably unnecessary Stamp Duty Holiday stimulus. The evidence I see from the ground in East London is that despite the ending of the stamp duty in September 2021, buyer demand hasn’t waned.
The pandemic has altered what many buyers are looking for putting added pressure on demand for larger homes. Semi’s and terraced housing with gardens and lofts to convert are unquestionably the most desirable. In less demand are flats, particularly those without outside space. But rest assured, they are still fetching decent prices, albeit price appreciation in comparison to houses has been more muted.
Of course many buyers are also sellers but those yet to sell their own home are in stiff competition from a significant pool of chain free buyers in addition to landlords.
The market has reached a stalemate with many sellers choosing to wait until they’ve found their dream property before placing their's on the market. This is causing the supply of available homes even tighter than it otherwise could be.
From experience of the market, I’m a believer in placing a property onto the market even if the seller is yet to find a suitable home to move to. Many of today’s buyers are patient, content and willing to wait for the seller to find an onward move. With an agreed sale in the bag, this strategy enhances a seller’s position when hunting for the next property.
This supply crunch is affecting buyers and sellers across all budgets and alas, I can’t foresee the cost supply crunch ending anytime soon unless interest rate rises and an increase in the cost of living act as the catalyst for those in homes too big for their needs to take action and downsize.
They only ‘good news’ is that rising mortgage costs and pressures on household budgets will surely keep a lid on prices.
Time will tell.