1 | TwentyCi Property & Homemover Report – Q2 2018
TwentyCi Property & Homemover Report – Q2 2018
Information embargoed until Wednesday 11th July 2018 at 00:01
2 | TwentyCi Property & Homemover Report – Q2 2018
Welcome to the latest edition of the TwentyCi Property & Homemover Report providing a comprehensive review of the UK property market, created from the most robust property change sources available – providing a real time review of the UK the market and covering 99.6% of all property moves (both sales and rentals).
This ‘state of the nation’ report provides unique insight into the people behind the numbers, creating a picture of the demographic, regional and socio-economic factors impacting the housing market including:
√ Factual data (not modelled or sentiment-based) √ Full market coverage √ Demographic overlay √ Property sales data √ Property rental data √ Real-time data
The TwentyCi National Property & Homemover Report is published quarterly.
3 | TwentyCi Property & Homemover Report – Q2 2018
Executive summary for Q2 2018
Confidence is building
With new instructions up nearly 7% year on year, house prices remain stable with no significant discounting. This ongoing stability suggests we could be starting to see the green shoots of a recovery in confidence, from both buyers and sellers. Interest rates remaining on hold, a strong labour market and wage growth finally picking up are all contributing to an increasing number of home owners entering the market.
Online agents are on the riseOnline estate agents now represent nearly 8% of all exchanges, an increase of 13% from Q1 to Q2. In the last year, online agents have established a greater footprint across England, helped by significant investment in advertising and the introduction of more local property experts. The share of the properties they represent has also grown, increasing by more than 30% in most price bands below £1m. The announced merger of Emoov and Tepilo may indicate the start of consolidation of players within this space.
London remains an enigmaLondon continues to operate its own unique property ecosystem. The average asking price is up 3.1% in Q2, an increase seemingly generated by a lack of available properties. Time to sell averages over five months, although a lack of noticeable discounting suggests sellers are patient. Nearly two thirds of properties available in Q2 were rentals, underlining the dominant tenure within the capital.
All data is based on Q2 2018 versus Q1 2018 or Q2 2017 for year-on-year comparisons unless otherwise stated. Analysis of property buyers is based on demographic overlay data versus individual property-based data triggers.
Smaller homes are the biggest sellersTerraced and semi-detached houses continue to make up the largest proportion of property sales, accounting for over 55% of all exchanges in Q2. Both housing types have grown in the last year, driving growth overall. In comparison, flats show a significant decline in sales volume with the conjecture being that flats now dominate the rental rather than sales market in our major towns and cities.
The Silver Economy is going from strength to strengthBaby boomers’ appetite for property continues unabated, with exchanges up 10% year on year, fuelled by a combination of final salary pension schemes, pension drawdown and equity retrieval, as well as wealth accumulated in property.
Realised prices vary by valueA review of 2017 listed prices compared to the price actually achieved shows an average discount of up to 4% for properties sold for less than £1m, suggesting there is no significant property devaluation occurring. The realised value of properties over £1m, however, shows an average discount of 8%.
Colin Bradshaw, TwentyCi’s Chief Customer Officer, notes that “The growth in market share for online agents continues unabated, with this group now representing nearly 8% of all exchanges. It is interesting to note that almost all of this growth has been in properties below £1m. Logic might dictate that a fixed-price service would be more attractive to sellers of higher-priced properties, but perhaps this group of vendors is motivated by factors other than just price”.
Kate Faulkner, Managing Director at Propertychecklists.co.uk, said, “With some indices and market reports suggesting we have a market currently in the doldrums, this in-depth data shows that this very much depends on the market consumers are operating in. For example those selling properties over a million pounds are having to discount - and if in London, selling times are around 5 months. In contrast, terraces and semi-detached properties under a million pounds are dominating transactions currently. The summer months will be crucial to finding out which way the market goes for the rest of 2018“.
4 | TwentyCi Property & Homemover Report – Q2 2018
Contents
UK national trends 05
UK regional trends 06
Sale vs rent – top 10 cities UK-wide 08
London trends 09
Price bands, income bands and property type 10
2017 property price reduction 12
Homemover segments 13
High street agents vs. online 14
Average time on market 15
Unusual property features… Did you know? 16
5 | TwentyCi Property & Homemover Report – Q2 2018
UK National TrendsNew instructions are up 6.6% compared to Q2 2017, and 11.7% compared to Q1, suggesting a significant increase in the number of properties coming to the market, easing previous supply issues. While property exchanges are down by 1% compared to Q2 2017, we expect this figure to rise during 2018 as the extra supply filters through, building confidence and stability in the property market.
Q2 2018
Exchanged properties Fallen through propertiesWithdrawn propertiesSSTC propertiesNew Instructions
All of UK
4/2018
5/2018
6/2018
0
50000
100000
150000
200000
Exchanged properties Fallen through propertiesWithdrawn propertiesSSTC propertiesNew Instructions
209k Exchanged
58k Fallen
through
176k Withdrawn
299k SSTC
498k New
Instructions
Exchanged properties Fallen through propertiesWithdrawn propertiesSSTC propertiesNew Instructions
209k Exchanged
58k Fallen
through
176k Withdrawn
299k SSTC
498k New
Instructions
Average House PriceAverage house prices are stable year on year at just under £300k.
6 | TwentyCi Property & Homemover Report – Q2 2018
UK Regional Trends
Number of Exchanged Properties by Region
£242,963 3%
BirminghamCardiff
Bristol
London
Sheffield
Glasgow
Edinburgh Newcastle upon Tyne
Manchester
Nottingham
Leicester
£168,141 6%
£170,863 -2%
£175,166-1%
£205,3896%
£197,7504%
£320,4214%
£812,903-5%
£229,5450%
£201,255 3%
£212,324 3%
£184,735 0%
£162,326 -7%
£191,887 0%
£164,430 4%
£288,015 2%
£364,530 -3%
£284,642 -2%
£185,116 3%
£216,681 -2%
LONDON(within M25)
£573,783 -5%
£246,0366%
UK Regions Q2 2018 Q2 2017 Q1 2018Difference in
last YearDifference in last Quarter
East Midlands 15,152 14,399 15,519 5% s -2% tEast of England 17,381 15,833 18,597 10% s -7% tLondon (M25) 25,792 27,695 29,457 -7% t -12% tNorth East 7,196 7,631 6,906 -6% t 4% sNorth West 25,241 25,354 26,520 0% n -5% tScotland 8,639 11,840 8,450 -27% t 2% sSouth East 38,164 36,975 41,598 3% s -8% tSouth West 24,445 23,601 27,574 4% s -11% tWales 10,198 10,847 10,282 -6% t -1% tWest Midlands 19,092 19,144 20,685 0% n -8% tYorkshire & the Humber 18,027 18,096 17,530 0% n 3% s
s = upn = no movementt= down
The North East of England, Yorkshire and the Humber and Scotland are the only regions to have experienced growth in the number of exchanges in Q2 2018 compared to the previous quarter, with all other regions showing a quarterly slowdown. Comparing year on year, we are seeing significant geographical variation, with the East of England showing a growth of 10%, while Scotland is down by over 25%.
7 | TwentyCi Property & Homemover Report – Q2 2018
The increase in demand in the East Midlands and East of England is driving a year-on-year increase in the average asking price of properties. In Scotland however, a drop in the number of exchanges and a 7% fall in average asking price suggests supply is exceeding demand.
The average asking price has increased in Q2 in all major cities except Glasgow and Newcastle upon Tyne. Manchester has seen the greatest increase. The rise across the country can be interpreted as growing confidence from sellers in the price they believe can be realised for their property. This, combined with a significant increase in new instructions in Q2, suggests confidence and momentum returning to the property market.
Average asking price in the top 10 cities and regions UK-wide + London
£242,963 3%
BirminghamCardiff
Bristol
London
Sheffield
Glasgow
Edinburgh Newcastle upon Tyne
Manchester
Nottingham
Leicester
£168,141 6%
£170,863 -2%
£175,166-1%
£205,3896%
£197,7504%
£320,4214%
£812,903-5%
£229,5450%
£201,255 3%
£212,324 3%
£184,735 0%
£162,326 -7%
£191,887 0%
£164,430 4%
£288,015 2%
£364,530 -3%
£284,642 -2%
£185,116 3%
£216,681 -2%
LONDON(within M25)
£573,783 -5%
£246,0366%
Year-on-year figures
UK CitiesAverage
asking price £ Q2 2018
Difference in last Year
Difference in last Quarter
Birmingham 247,350 2.0% 1.8%Sheffield 183,374 4.2% 7.3%Glasgow 166,743 -0.3% -0.8%Newcastle upon Tyne 174,414 -5.6% -0.4%Manchester 212,466 7.9% 3.4%Nottingham 209,965 3.8% 4.3%Cardiff 207,945 5.4% 5.2%Edinburgh 247,821 2.2% 8.0%Leicester 255,101 5.1% 3.7%Bristol 323,753 3.2% 1.0%
Colin Bradshaw, Chief Customer Officer of TwentyCi, says, “It is interesting to note that prices in Newcastle upon Tyne have fallen nearly 6% versus last year, as opposed to Manchester where prices have risen nearly 8% over the same period. This perhaps reflects the growth of Manchester as a commercial centre and more specifically as a media city. These results demonstrate the mixed fortunes of cities with a heritage of traditional industry.”
8 | TwentyCi Property & Homemover Report – Q2 2018
Renting continues to be a popular choice in the UK’s major cities as we see a societal shift to longer-term renting due to the difficulty of getting on the property ladder. For Q2, approximately a third of all listings are within the rental sector. Both Edinburgh and Glasgow have significantly more sales than rentals listings, in line with the earlier observation that supply is exceeding demand in Scotland.
Sales vs rent – top 10 cities UK-wide
National Sales vs Rent Q2 2018
Birm
ingh
am
36%
64% 66% 78% 59% 55% 64% 67% 81% 66% 67%
34%
22%
41%45%
36% 33%
19%
34% 33%
Sheffi
eld
Gla
sgow
New
cast
le
Man
ches
ter
Not
tingh
am
Car
diff
Edin
bur
gh
Leic
este
r
Bris
tol
SALE
SRE
NTS
Colin Bradshaw, Chief Customer Officer of TwentyCi, notes that, “Manchester has the highest percentage proportion of properties to rent of the top 10 cities UK-wide, at 45%. This contrasts strongly with Edinburgh, where the percentage of rental properties available is only 19%. This is perhaps reflective of the strong supply of properties for sale in Edinburgh.”
9 | TwentyCi Property & Homemover Report – Q2 2018
Central London£760,781
-8.4%
£541,086
£520,098
£932,004
£1,058,882
£752,5506%
0%
5%
0%
2%
2%6%
£1,135,54712%
£1,110,471
South East
South West
East
East Central
West Central
North
North West
£1,224,582West
London Trends
All areas of London saw an increase in the average asking price in Q2, with North West London showing a significant uplift as the property hotspots in the capital shift northward.
As the number of new instructions in London remains subdued, a lack of supply is likely to drive prices higher.
Just under 60% of property listings in London in Q2 are for rental properties, consistent with previous quarters.
The lack of affordable property for sale and a limited sale supply generally is likely to sustain this trend in the capital.
Sales vs Rent – London
London Sales vs Rent Q2 2018
Lond
on E
59%
41% 30% 45% 39% 51% 44% 39% 25%
70% 55% 61% 49% 56% 61% 75%
Lond
on E
C
Lond
on N
Lond
on N
W
Lond
on S
E
Lond
on S
W
Lond
on W
Lond
on W
C
SALE
SRE
NTS
10 | TwentyCi Property & Homemover Report – Q2 2018
Household Income Band
Property Price Band
Price Bands, Income Bands and Property Type
Year on year, households earning more than £50k per annum have seen the greatest increase in exchanges, with the squeeze on disposable income being felt more keenly by low-earning households. This in turn impacts the volume of exchanges in this income band.
The significant decrease in the number of exchanges within price bands below £150k illustrates the lack of affordable housing at lower price points and the fact that low earners are struggling to get on the property ladder in all areas. The drop is also reflective of the general switch from buying to renting. The market for properties above £200k shows distinct signs of picking up as confidence arises from stability.
Number of Exchanged Properties by Income Band Q2 2018
0
5000
10000
15000
20000
25000
30000
35000
40000
NU
MBE
R O
F EX
CH
AN
GES
20K
11K
31K33K
35K
25K
16K
23K
10K
4K
<£15K
£15K - 19,999
£20K - 29,999
£30K -39,999
£40K - 49,999
£50K - 59,999
£60K - 69,999
£70K - 99,999
£100K -149,999
£150K +
4%
-3%
-6%-7%
-3%
6%
2%
5%
1%
8%
% Difference vs Q2 2017
31k FLAT
-18%
3k COTTAGE
-8%
21k BUNGALOW
-5%
55k SEMI
DETACHED
6%
39k DETACHED
-12%
61k TERRACED
8%
Number of Exchanged Properties by Price Band Q2 2018
Property types Q2 2018
0
5000
10000
15000
20000
25000
30000
35000
NU
MBE
R O
F EX
CH
AN
GES
6K
-54%
-27%
-14%0%
9%
14%
22%
% Difference vs Q2 2017
23%19%
15% 15% -1% -35%
19K
33K
35K
27K
24K
30K
15K14K
4K 3K 445 39
<£50K
£50K - 100
£100K - 150
£150K - 200
£200K - 250
£250K - 300
£300K - 400
£400K - 500
£500K - 750
£750K - 1m
£1m - 2m
£2m - 5m
£ 5m +
11 | TwentyCi Property & Homemover Report – Q2 2018
Property Types
Lifestage
Year on year, semi-detached and terraced houses have seen the greatest levels of growth in exchanges, while detached homes continue to show the greatest decline, with exchanges dropping by 12% since Q2 2017.
The decline in exchanges for detached properties perhaps reflects owners taking a ‘stay and improve’ approach rather than selling in a subdued market. Higher stamp duty rates could also be off-putting for potential buyers. A steady stream of new instructions on detached homes though may improve momentum in this market.
The Silver Economy is still showing good levels of growth year on year, with 10% more property exchanges in Q2 2018 compared to Q2 2017.
Compared to Q1 2018, the last quarter has seen a decline in the volume of exchanges for most age groups. The 66+ group is the only audience to marginally buck the trend, with a growth of 1% in exchanges against a nationwide decline of 6.2%.
For under 35s, the decline in exchanges both year on year and quarter on quarter suggests a reluctance to make the significant lifestyle and financial shift from tenant to home owner.
% Difference vs Q2 2017
Number of Exchanged Properties by Property Type Q2 2018
10000
20000
30000
40000
50000
60000
70000
80000
NU
MBE
R O
F EX
CH
AN
GES
-8%
-8%
-5%
6%
-12%
8%
31K
3K
21K
55K
39K
61K
69K
3K
Q2 2018
FlatCottageBungalowSemi DetachedDetachedTerraced
Number of Exchanged Properties by Lifestage Q2 2018
0
20000
40000
60000
80000
100000
NU
MBE
R O
F EX
CH
AN
GES
34K
4K
18-35 36-45 46-65 66+
-14% 44K
10%
46K
-8%
85K
4%
% Difference vs Q2 2017
12 | TwentyCi Property & Homemover Report – Q2 2018
2017 Property Price Reduction
The tables below show % price reduction when comparing the original listing price with the price recorded by Land Registry after completion.
By region By price band
Region % Perc
Scotland 2.25%West Midlands -2.86%East of England -2.88%South East -3.16%Wales -5.23%South West -3.19%Greater London -3.26%East Midlands -3.25%Yorkshire & Humber -3.84%Inner London -4.41%North West -4.18%North East -5.38%
Price band % Perc
Less than £200k -3.24%£200k - £350k -2.95%£350k - £1m+ -3.57%£1m+ -7.54%
Comparing property price realised to the orginal listing price for 2017 perhaps surprisingly shows that there is in general no significant discounting, either by region or price band. The only exception is £1m+ properties which arguably exist within their own ecosystem.
With a limited number of properties coming to market compared to 10 years ago, sellers no longer need to offer significant discounts to secure a sale.
13 | TwentyCi Property & Homemover Report – Q2 2018
377,742
Difference in last year
-1%Difference in last quarter
+29%
Difference in last year
-9%Difference in last quarter
+26%
Difference in last year
-3%Difference in last quarter
+11%
Difference in last year
-2%Difference in last quarter
+5%
Difference in last year
+5%Difference in last quarter
-7%
307,071 263,748 238,442 218,093
Move MakerFirst listing your
house as For Sale
Move PlannerMaking an offer on
your new home
MoverApproaching the
time of move
Nest BuilderJust
moved
Home MakerRecently moved
Homemover Cycle Segments Q2 2018
Homemover segments
Q2 increase in move makers and move planners
Num
ber
of h
ouse
hold
s
TwentyCi’s data tracks homemovers as they make their way through the property buying or renting process. Known as the homemover wave, this journey can last several months and is broken down into five specific stages triggered by activity such as online property searches, surveys and EPC reports.
Q2 2018 has continued this year’s trend of growth in households entering the homemoving journey, with 29% more at the move maker stage and a 26% increase at the move planner stage.
The significant increase at the start of the homemover wave bears out the jump in new instructions seen in Q2 as confidence in the property market is rekindled. We would expect the mover and nest builder segments to rise in Q3 as households pass through the homemoving journey.
14 | TwentyCi Property & Homemover Report – Q2 2018
High street agents vs. online
Online agents’ market share by region
Online agents’ market share by price band
Region % Growth YoY
Yorkshire and the Humber 51.58%Inner London 47.34%Wales 45.21%North West 45.07%East Midlands 44.04%East of England 42.70%North East 38.55%West Midlands 35.75%South West 33.21%Greater London 23.09%South East 16.67%
Over 15,000 households have exchanged when listed with an online agent in Q2 2018, increasing the share of online agents by 13% in the last quarter from 7% to 8%.
Online agents show significant growth throughout England and Wales as the key online brands become national players.
Greater London and the South East show the lowest increase, with year-on-year growth below 25%.
As the online offering starts to appeal to all home owners, online agents are now representing properties across all values up to £1m, with growth greater than 30% year on year in all price bands.
0
50000
100000
150000
200000
High Street Agents
192,653
15,98613%
-1%
Online
NU
MBE
R O
F EX
CH
AN
GES
Price band Q2 % Growth YoY
£0 to £200,000 8.85% 32.53%£200,000 to £350,000 7.72% 32.92%£350,000 to £1m 5.53% 38.39%
15 | TwentyCi Property & Homemover Report – Q2 2018
Average time on market
Average time on market for London properties
Average time on market for properties less than £1m
CityAverage time on market this quarter
(days)Edinburgh 87Glasgow 97Bristol 103Cambridge 108Birmingham 133Manchester 117Leeds 120Oxford 131Cardiff 141Newcastle upon Tyne 188
London areaAverage time on market this quarter
(days)South East London 123East London 137North London 137South West London 152Western Central London 164North West London 169West London 174Eastern Central London 220
The table highlights the time taken from new instruction to sold subject to contract. Edinburgh and Glasgow heading the table reflects the Scottish house-buying process and binding offers.
There is a marked difference in the speed to sell in London, with the process from new instruction to sold subject to contract taking over five months on average. This is a whole month longer than the average for the other UK cities, underlining the two-paced nature of the UK property market.
16 | TwentyCi Property & Homemover Report – Q2 2018
TwentyCi
TwentyCi is a life event data company that provides intelligence into the events in consumer lives which act as purchase triggers, such as moving home, having a baby, buying a car or retiring. TwentyCi has been managing data for major advertisers like HJ Heinz, ATS Euromaster and many leading estate agents for over 15 years. TwentyCi holds the UK’s biggest and richest resource of factual life event data including the largest,
most comprehensive source of homemover data compiled from more than 29 billion qualified data points. It works with advertisers and their agencies to create contextually targeted marketing programmes that cut through by reaching consumers at the exact moment that they need a company’s product or service, through the best media channel for that individual. For more information visit www.twentyci.co.uk.
Unusual property features… Did you know?
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17 | TwentyCi Property & Homemover Report – Q2 2018
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