The Blog

What’s Happening In The UK Property Market?January 2023 The housing market remains uncertain heading into 2023, but there’s some optimism among homeowners and first-time buyers, particularly as one developer has launched an innovative new scheme. Read on to find out the latest. House Prices See New Year Bounce Back While house prices fell towards the end of 2022 (see below) and are expected to continue falling in 2023, there was at least some positive news to start the year for potential sellers! Property portal, Rightmove, has reported the biggest New Year bounce since 2020, with average prices rising by 0.9% according to their data. And while there’s usually an increase in demand in January, the figures still make for positive reading for sellers, as there’s been a surge in demand from potential buyers too. Rightmove has reported a 55% jump in the number of people contacting estate agents about homes listed on the site in the first two weeks of the year. This is coupled with an increase in the number of homes entering the market, as the company has also reported that the 5th January was the third busiest day ever for homeowners asking estate agents to value their home. House Prices Drop For Fourth Month in a Row  High interest rates and the rising cost of living contributed to a fall in house prices for a fourth consecutive month in December. Figures released by major lender, Halifax, showed a 1.5% decrease in the average asking price, which now stands at £281,272. However, while there’s traditionally a seasonal slowdown in December, the fall wasn’t as sharp as expected, and was lower than November’s drop of 2.4%. On an annual basis, prices grew by 2% compared with December 2021, representing the slowest year-on-year growth since October 2019. And while the market slowed significantly towards the end of 2022, average prices still remain way above pre-Covid levels, and so far the start of 2023 is looking similar to the starts of 2016, 2017 and 2018, although some forecasters are predicting a 10% drop in 2023. Mortgage Approvals Drop to New Lows Figures released by the Bank of England suggest that mortgage approval levels have fallen to their lowest level in two years. Just over 46,000 mortgages were approved in November – a drop from October’s figure of 58,000, as would-be homebuyers have been increasingly put off by rising interest rates and cost of living pressures. The slump is expected to continue as uncertainty takes hold of the market and the cost of living continues to be volatile. Rents Rising at Fastest Rates on Record Data from the Office for National Statistics (ONS) shows that rental rates increased by 4% on average in 2022 – the fastest rise since records began seven years ago. A quarter of private tenants surveyed in December said their rent had risen in the previous six months, as many landlords have passed on the increases they’ve faced on their buy-to-let mortgage rates. The ONS figures also showed that renters pay significantly more on their living costs than homeowners, with their weekly expenditure on housing accounting for 24% of their income – 8% higher than those with a mortgage. New ‘Save To Buy’ scheme launched for first-time buyers An innovative scheme by one leading home developer could pave the way for thousands of renters to get onto the property ladder. The initiative, set up by new homes developer, Fairview, will see all of the money paid by tenants in rent be put towards the deposit for their home. Under the scheme, rent is paid at a fixed cost for between six months and two years, but instead of going to a landlord, the money will be set aside until the renters have a big enough deposit to obtain a mortgage on the property. At that point, they can go through the usual mortgage application process and buy the home they’ve been renting. The scheme is currently running at two of Fairview’s developments – New Hayes in West London and Epping Gate in Loughton, Essex. However, it’s expected to be rolled out to a number of other developments over the next few months. The scheme is open to anyone who is classed as a first-time buyer, and the only stipulation is that you must have a deposit equivalent to 1% of the property’s value when you first move in. This is handed over to the developer when you first exchange contracts, and from that point, 100% of your rent will go towards the deposit to buy the property. There’s also an option to top up your monthly payments if you can, which means getting on to the property ladder sooner. For more property news and updates and a more detailed overview of the East Sussex area, get in touch with Paul Stripp Estate Agent. We are your local property experts. Call us on 07891260449 or email info@paulstrippestateagent.com.

Property prices, one minute they’re up, then they’re down, and there’s a whole lot of scaremongering in between. In this post, I’m going to shed some light on the current property market, focusing on what is happening with UK property prices and why sometimes things aren’t exactly as they seem.  Are House Prices Up or Down? Average House Prices in East Sussex - Land Registry Honestly, whether house prices are up or down and whether that’s a good or a bad thing can vary hugely depending on where you’re getting the information.  Generally speaking, The Land Registry’s UK House Price Index is one of the most reliable sources for this information, but it tends to lag by about two months. According to the Land Registry, the average price of a UK property increased by 13.6% in August year-on-year.  While the exact average price for a UK home during this period was estimated to be £295,903, the regional figures vary. In Scotland, the average price currently is around £195,391, while in England, it sits at £315,365, with properties in the South East coming in at £363,552.  Rightmove, Nationwide and Halifax also publish their own sets of data each month. These numbers tend to be updated more regularly and are based on confirmed sales and mortgage lending. While they, too, show an upward trend in house prices, their figures aren't always taking in the whole picture.  Can You Trust House Price Statistics? This leads me to the big question. If the data provided by the Land Registry is usually two months behind and the numbers given by Rightmove, Halifax and Nationwide aren’t giving the complete picture, can you trust these statistics? The short answer is no - but that doesn’t mean they aren’t useful.  House price statistics are a bit like weather predictions, they can help you plan, but you shouldn’t trust them 100%.  If monitoring house prices is something you’re interested in, then cross-reference the data from multiple sources and be mindful of external influences.  What’s Happening to House Prices This Christmas and Beyond? If the Land Registry, Rightmove, Halifax, and Nationwide statistics are anything to go by, then it looks like house prices will remain high and on the rise as 2022 comes to a close.  However, with the cost of living crisis and rising mortgage rates lurking in the wings, the bigger picture is a bit more complicated.  Economic uncertainty tends to slow consumer spending, and therefore while I expect house prices to remain high in the foreseeable future, they could begin to drop off at the start of 2023. What’s more, if a recent analysis by Capital Economics is correct, we may see house prices fall by up to 12% by mid-2024.  Is Now a Good Time to Buy or Sell Your Home? Whether now is the right time to buy or sell depends largely on your personal situation.  If you’re a buyer in a position to sit out of this period of economic uncertainty, then it may be better to wait a year or so in the hope that prices drop and mortgage rates fall. On the other hand, there’s no telling when that may be, and if mortgage rates continue to rise, you may be better off locking in a lower rate now. For first-time buyers, the nil-rate tax threshold also recently increased from £300,000 to £425,000, so it may be a good time to get on the ladder.  For sellers, if you want to sell your home for maximum profit, house prices are at an all-time high. While Rightmove says it took an average of 37 days to sell in September, up from 32 days in May, properties are still in high demand, with the most recent data from HMRC showing that around 104,000 transactions went through in September this year. Ultimately, whether now is the right time for you depends on your unique situation, but I’d be more than happy to give my two pence. Give me a call at 01424 772954 or message me at info@paulstrippestateagent.com for honest and impartial property advice.