A new survey of over 500 UK estate agents, commissioned by GetAgent, found that higher mortgage rates are proving to be the market's greatest challenge.
A new analysis of estate agent sentiment by estate agent comparison site, GetAgent.co.uk, has revealed that despite higher mortgage rates, continuing to create challenges for the nation’s estate agents, market momentum is starting to build in 2023, with an uplift in buyer and seller activity levels.
The survey of over 500 UK estate agents, commissioned by GetAgent, gauged current market conditions from those on the ground based on buyer interest, stock levels, new seller enquiries and other market indicators such as price offered, fall throughs and down valuations.
The research shows that in current market conditions, agents feel it’s higher mortgage rates that pose the greatest challenge, with high levels of inflation and general market uncertainty also ranking high, while the marginal rates of house price depreciation seen in recent months were the least big challenge.
When asked when they anticipate the market to recover, 43% stated they believe it will come next year, 29% believe it will happen in 2023, and just 28% don’t believe it will happen in the near future.
When asked how current buyer interest levels compare, just 22% stated they were busier than this time last year, 32% stated they were as busy as this time last year, with 46% stating they were less busy.
However, there has been a 4% increase in the number of those who stated they were busier than last year when compared to January of this year, with a 7% increase in those stating they were as busy and a -11% reduction in those stating they were less busy.
In a similar fashion, 41% stated they were currently holding less for sale stock compared to this time last year, down -10% versus January. While 26% said they currently had more for sale stock, up +7% versus January.
There has also been a +2% increase in the number of those stating they were seeing more new enquiries from sellers. Now at 27% versus 25% in January.
However, 56% stated they were seeing buyers submit offers at below asking price, up 6% from 50% in January. There has also been a 6% increase in the number of agents seeing offers for above asking price, albeit a comparatively low 18% of respondents, up from 11% from the start of the year.
54% of agents also said they were seeing more sales falling through, up 10% since the start of the year.
COO of GetAgent.co.uk, Mal McCallion commented:
“We’re yet to see house prices tumble as many previously feared and while they may have cooled in recent months, this marginal reduction isn’t the biggest issue facing estate agents today.
"However, it remains a challenging landscape as they contend with higher levels of market volatility, as well as a lower level of activity on both the side of buyers and sellers. The result of which is a realignment of asking prices and a higher propensity for sales to fall through further down the line.
"The good news is that momentum is starting to build and while the majority of agents aren’t as busy as they were last year, the tide is slowly turning with more agents seeing an uplift in buyer and seller activity when compared to the start of this year.”