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UK property sales surged in September at the quickest pace since the recovery following the lockdown, spurred by decreased mortgage rates that enhanced demand from homebuyers, according to Zoopla’s data.
The volume of sales agreed in the four weeks leading up to September 21 grew at an annual rate of 25 percent, marking the sharpest rise since spring 2021, when the market bounced back after the initial Covid-19 lockdown, as indicated by research from the property portal.
Inquiries from buyers to estate agents increased by an annual rate of 26 percent during the same timeframe, highlighting the fastest growth in more than three years, according to the latest data released on Thursday.
“Lower mortgage rates are providing a crucial confidence uplift to homeowners, many of whom have been hesitant to engage over the last two years,” remarked Richard Donnell, executive director at Zoopla.
He noted that mortgage rates, currently at their lowest in over a year, are “facilitating double-digit growth across all key indicators of sales market activity.”
The statistics bolster evidence of a recovery in the UK property market as quoted mortgage rates continue to decrease.
The latest figures from the Bank of England indicated that mortgage approvals reached their highest level in two years in August, while the lender Nationwide reported a significant rise in approvals, the fastest in two years, during September.
The average two-year fixed-rate deal, with a 60 percent loan-to-value ratio, stood at 4.7 percent in August, a drop from 4.9 percent the previous month. This figure is considerably lower than the peak of 6.4 percent seen in August of last year, according to BoE data.
Alex Kerr, an economist at Capital Economics, stated that further reductions in swap rates, which impact mortgage deals, in September indicated “potential for mortgage rates to decline further and for house price growth to accelerate next year.”
Zoopla reported a 16 percent annual rise in new properties being listed and a 12 percent increase in the inventory of homes for sale.
They attributed this trend to “speculation over potential tax changes in the Budget, prompting investors, second homeowners, and others with multiple properties to consider selling.”
Supply growth was particularly notable in coastal and rural regions, where prospective tax changes coincide with many English councils planning to double council tax on second homes over the upcoming year, according to Zoopla.
In locations such as Truro, Exeter, and Lincoln, the availability of homes surged by more than 20 percent annually last month.
Nigel Bishop, managing director of buying agent Recoco Property Search, commented that second homeowners and buy-to-let investors are facing “significant changes” due to tax reforms on unoccupied homes.
“If a considerable number of second homes come onto the market, we may see the property market in regions like Cornwall become increasingly appealing to house hunters seeking a permanent residence but are currently priced out of the market,” he added.