A considerable number of homes currently for sale in the UK are chain-free, providing potential buyers with quicker and less complex purchasing options.
- Zoopla reports a 25% increase in house sales compared to last year, driven by an influx of new listings and lower mortgage rates.
- Many new listings come from landlords and second-homeowners aiming to sell before potential tax hikes.
- Movement in the housing market is largely influenced by the prospect of increased capital gains tax and doubled council taxes on second homes.
- The market sees significant regional disparities in house price changes, with some areas experiencing declines and others seeing growth.
According to Zoopla, a notable increase in house sales has been observed, with a 25% rise compared to the same period last year. This uptick is facilitated by an increase in new property listings and a decline in mortgage rates. The average rate for a five-year, 75% loan-to-value mortgage has decreased to 4.3% from 5.5% last year, encouraging more homeowners to consider moving.
A significant portion of the new property listings are from landlords and second-homeowners who are keen to sell amidst rising buy-to-let mortgage rates and potential impending tax changes. There is an expectation that the government will increase capital gains tax on residential properties in the upcoming Budget.
In London, two- and three-bedroom houses are predominantly chain-free, often originating from rental or second homes. Outside the capital, one- and two-bedroom flats mainly represent the chain-free market. Approximately 13% of all current listings were previously rented, with landlords selling before potential tax changes come into effect.
Potential increases in capital gains tax are not the only concern. Many local councils are planning to double council tax for second homes next year, prompting a surge in property listings in coastal areas such as Truro, Torquay, Exeter, and Bournemouth, which have seen a 40% increase over the past year.
Richard Donnell, Zoopla’s executive director, highlighted that the housing market’s expanded supply is driven by tax speculation and previous tax changes, offering buyers more choice and anticipating controlled house price inflation into 2025. Although overall UK house prices have risen by 0.7% over the past year, this growth rate remains modest compared to previous years.
The anticipated tax changes and regional price variations will likely continue influencing the UK housing market dynamics.
