Twindig Housing Market Index (HMI) - 26 February 22

This week we saw housing transactions get off to a flying start, up 5.1% in January 2022 and Rightmove announce record profits. Agents may be suggesting they are short of stock, but someone is selling a lot of houses. We suspect that higher than usual sales rates give the impression, rather than the reality of stock shortages).

However, investor confidence in the housing market took a hit as developments in Ukraine weighed on investors' minds. The Twindig Housing Market Index fell by 6.5% to 80.2, its biggest fall since 11 December 2020. Concerns about bank's willingness to lend and the sobering impact of war on a household's decisions to move house appeared to drive investor confidence in the housing market downwards. In our view, investors tend to react quickly and abruptly to new information and we expect that on reflection their concerns for the operation of a very domestic market may lessen.

We anticipate positive news about mortgage approvals, house prices and the underlying housing market from some of the major housebuilders next week (Persimmon, Taylor Wimpey and Vistry) as well as update on the London housing market from Foxtons.

Turning back to this week, the most impressive news of the week came from Rightmove, in our view. As the pandemic hit and the housing market closed in 2020, Rightmove was slow to come to the aid and support of estate agents (the hands that feed it), leading to talk of an agent mutiny, challenger portals saw the opportunity to slay the Goliath of the sector. However, one year on, and Rightmove is back in control, charging estate agents more than ever to put the agent's content (the content we want to see) on its site. With profit margins back above 75% (yes for every £ agents give Rightmove 75p goes into Rightmove's back pocket), economic theory suggests that the challengers will keep on coming, but so far, they have either failed to challenge or settled for a minor supporting role in the property portal landscape.