House sales drop in July ‘due to market shrinking’

June saw more than 80 local market house sales, while that number dropped to 60 in July.

Market watchers said that the decline was likely to be seasonal, though the July figure was markedly down on sales in July 2021, where more than 90 local market homes were sold in both June and July at the height of the property

boom.

According to market analyst ABConveyances, the median price for a local market house in July was £730,813. There were eight local market sales of more than £1m. during the month.

But the trend for houses selling at above asking price seems to have ended. Several properties sold fairly quickly after going on to the market, but all at a discount on asking price.

Property professionals said there were signs that availability of properties was starting to slow.

‘It is a lack of houses on the market,’ said Pierre Blampied, managing director of mortgage broker SPF Private Clients.

Spencer Noyon, director of estate agents Swoffers, said it was dangerous to look at one month in isolation.

‘It is the school holidays and lots of people are away, rather than interest rates rising,’ he said. ‘If the right property comes along then people will buy it.’

Interest rates have been rising now for six months in a row, with last week the Bank of England pushing up rates by 0.5%, the biggest individual monthly rise for 27 years.

Mr Noyon said he did not believe that rates were impacting the market, and Mr Blampied agreed. ‘I don’t think it is to do with interest rates going up,’ he said.

SPF has been advising clients to take out five-year fixed mortgages rather than variable or base rate trackers.

‘People seem to want more guidance about what sort of mortgage to take. In the past two months or so we have been recommending that people take a five-year fixed, which has been the most attractive.’

Mr Blampied said one client had a mortgage lender offer a five-year fixed term at 1.8% interest in June, which has now increased to 2.8%.

‘From a lifestyle perspective five years is long enough, that is when many people have children or are moving house. From a positive point, banks are still keen to lend,’ he said.

House sale numbers have been volatile over the period when interest rates were doing anything more than bumping along the bottom since the global financial crisis in 2008.

Last year saw the highest number of local market house sales – with just over 800 – since the 2008 global recession. That worked out as an average of about 66 homes sold per month.

So far this year just less than 400 local market house sales have gone through – an average of 56 per month.