There were 13 new buyers for every property listed for sale in the UK in September according to Knight Frank.
Over the last five years, the only time demand has exceeded supply to a greater extent was in January 2020, when the short-lived ‘Boris Bounce’ was evident following the Conservatives’ landslide General Election victory.
The number of new prospective buyers in September 2021 was 57 per cent above the five-year average between 2015 and 2019.
In fact, the figure was only 13 per cent below last September’s figure, two months into a stamp duty holiday and during a period of post-lockdown exuberance.
The agency says that the UK economy is facing inflationary pressures this autumn but near-zero interest rates and low unemployment have underpinned demand, even as the stamp duty holiday wound down. The rising cost of living, however long it lasts, may cause some fraying around the edges but demand is likely to remain robust over the next six months.
Knight Frank goes on to say: "The vicious circle of low supply won’t become a virtuous circle overnight. More prospective vendors will come forward as they find their own purchase options, a process that is underway but requires time.
“Sales instructions have hovered around the five-year average this year but the shelves are emptying more quickly, creating the kind of disruption seen in other parts of the economy. As a result, supply didn’t pick up this September as it has in previous years. The number of instructions to sell was 26 per cent below the five-year average and 51 per cent below September 2020.
“Tighter supply means a greater proportion of buyers and sellers will be needs-driven over the next several months. However, there will be a seasonal injection of new supply next spring.
“For now, the imbalance is keeping upwards pressure on prices even though the stamp duty holiday has ended. As supply and demand normalise, the main UK house price indices should continue to slowly deflate.”