Buy
Rent
Sell
New
Prices
Home Asking Price Index, May 2021: synthetic boom continues as vast demand chases dwindling supply
Asking prices in England and Wales rose 1.1% in April, taking annual growth to 8.6% while unsold stock fell to a record low of 291,025.
- Monthly change in asking prices
- +1.1%
- Annual change in asking prices
- +8.6%
- Total unsold stock
- 291,025
- Typical Time on Market
- 76 days
In this article
This is the May 2021 edition of the Home Asking Price Index, released on 12 May 2021, under the headline:
Synthetic Boom Continues as Vast Demand Chases Dwindling Supply
The headlines and summary below are the report's own words, with the key figures as it published them, followed by the report's charts and regional tables as printed.
Headlines
- Asking prices across England and Wales add a further 1.1% since last month, pushing annualised average growth up to 8.6% (the highest annualised growth since Sept 2014).
- The total stock of property for sale in England and Wales has dropped again, setting a further all-time low of 291,025, 25.8% lower than in May 2020 and 36.1% less than in May 2018.
- Monthly supply remains well below expectations in all regions except Greater London where urban flight has increased new listings by 35% compared to April 2019.
- Phenomenal demand chasing fewer properties again forced up prices in every English region and Scotland since last month, with the largest hikes in the East Midlands (+1.9%), South East (+1.7%) and East of England (+1.6%).
- The North West property market now leads the 12-month regional growth chart at 11.4%, followed by Yorkshire, Wales and the East of England with annualised price rises of 10.9%, 10.8% and 10.8% respectively.
- Plagued by oversupply, Greater London remains the UK's worst-performing region with 4.8% annualised growth. Next worst is the West Midlands where prices have risen 7.8% over the last twelve months.
- Market momentum has increased again as buyers grab the little sales stock available: Typical Time on Market for unsold property in England and Wales has fallen by a further 10 days since last month to just 76 days. This figure is 13 days less than in May 2019.
- Still no sign of rents stabilising in the Greater London lettings market. Falls continue due to oversupply, down 13.3% year-on-year, while Hackney and Wandsworth boroughs register reductions in the average rent greater than 20%.
- By stark contrast, a drought in rental properties persists in all other English regions, Scotland and Wales, thereby driving up rents. During the last 24 months the total number of properties available to let has fallen by 37% across the UK, although in some areas the stock has fallen considerably further over the same time period (e.g. Wales is down by 70%).
- The largest annualised average rent hikes are in the East of England (+11.6%) and the South West (+12.2%).
Summary
The annualised mix-adjusted average asking price growth across England and Wales is currently +8.6% and further increases look inevitable; in May 2020, the annualised rate of increase of home prices was just 0.4%.
Asking prices (and rents) outside of London continue to inflate at an alarming rate, as vast artificial demand dwarfs paltry supply. Thanks to the stimulus measures of the extended Stamp Duty holiday (till the end of June), furlough scheme and government-backed 95% mortgages, together with the urban flight trend, home prices in England and Wales have gained 8.6% overall during the last twelve months, despite a lacklustre London market plagued by oversupply and reduced demand. This is the largest overall growth we have observed since Sept 2014 when the London property boom was at its height. Of course, this growth may well extend higher next month, driven by a record-breaking surge in mortgage lending that has soared far above the previous high set in 2007.
Key figures
| Measure | Figure |
|---|---|
| Monthly change in asking prices | +1.1% |
| Annual change in asking prices | +8.6% |
| Total unsold stock | 291,025 |
| Typical Time on Market | 76 days |
| New instructions vs two years ago | -16% |
| Greater London asking rent change | -13.3% |
| East of England rent change | +11.6% |
| South West rent change | +12.2% |
Figures are for England and Wales unless the report states otherwise, as published in the edition.
Charts from the report
Source: Home.co.uk Asking Price Index, May 2021, Indexed to May 2004 (Value =100).
Source: Home.co.uk Asking Price Index, May 2021
Source: Home.co.uk Asking Price Index, May 2021
Source: Home.co.uk Asking Price Index, May 2021
Source: Home.co.uk Asking Price Index, May 2021. Average = Mean (days), Typical = Median (days).
Regional tables
UK Asking Prices, May-21
| Region | Average Asking Price | Monthly % change | Annual % change |
|---|---|---|---|
| Scotland | £207,246 | 0.6% | 9.7% |
| North East | £175,513 | 1.2% | 8.1% |
| Yorks & The Humber | £227,331 | 0.3% | 10.9% |
| England & Wales | £335,213 | 1.1% | 8.6% |
| North West | £234,557 | 0.9% | 11.4% |
| West Midlands | £276,408 | 0.6% | 7.8% |
| East Midlands | £262,428 | 1.9% | 10.0% |
| East | £380,072 | 1.6% | 10.8% |
| Wales | £237,898 | 0.0% | 10.8% |
| Greater London | £543,987 | 0.5% | 4.8% |
| South East | £428,663 | 1.7% | 9.4% |
| South West | £350,402 | 1.4% | 8.3% |
UK Time on Market, May-21
| Region | Average Time on Market | Typical Time on Market | 2 year % supply change |
|---|---|---|---|
| Scotland | 266 | 90 | -17% |
| North East | 228 | 82 | -23% |
| Yorks & The Humber | 167 | 60 | -20% |
| England & Wales | 186 | 76 | -16% |
| North West | 183 | 74 | -23% |
| West Midlands | 163 | 67 | -15% |
| East Midlands | 152 | 59 | -22% |
| East | 159 | 63 | -24% |
| Wales | 221 | 81 | -23% |
| Greater London | 187 | 86 | 35% |
| South East | 172 | 70 | -21% |
| South West | 174 | 67 | -29% |
From the director's commentary
"Fear of falling house prices gave us this artificial boom which, quite ironically, makes the risk of a correction much greater going forward. The next fear, of course, is what happens after June when the Stamp Duty holiday ends?"
Doug Shephard, Director at Home.co.uk
Read the full May 2021 edition (PDF, 8 pages)
About the Home Asking Price Index
The Home Asking Price Index measures the change in the prices sellers ask for residential property across England, Wales and Scotland. Today it is computed every month from around half a million advertised homes and is mix-adjusted, so a change in what happens to be on the market does not move the figure; earlier editions state the sample they were built from. Because an asking price is set months before a sale completes, the index runs around five months ahead of completed-sale measures such as the UK House Price Index.
Every edition in the archive, back to October 2006, is listed on the index page. How we measure the UK property market explains the listing data behind it, and today's figures by area are on house prices and rental prices.
Text and figures above are quoted from the May 2021 edition as published, with punctuation normalised for the web, and are not revised. Later editions may restate them.
