Last week, the Government published the UK House Price Index for August 2022, here, our residential sales and lettings experts break down the facts behind the figures.
Residential Sales – Lindsay French, Associate
“Yet again, prices in the the market have risen, this month by a national average of 0.9%, to £371,158 as a shortage of property for sale continues to bolster prices. The northeast has seen a small fall in prices of 0.5% to £182,447, but still up 8.6% year on year. This may seem surprising given the uncertainty following the government’s mini budget, but it will likely take some time for any impact to filter through to house prices, with the fall likely being seen in the South first.
There are also signs of some downward adjustment on existing properties for sale, with the number of price reductions up 2% from last month to 23%, this is, however, still much lower than the pre-pandemic five-year average of 32%. November and December normally see a seasonal drop in both listing and house prices, and it will be important to differentiate these seasonal changes from market changes which have been triggered by other factors.
At a time when we all start making plans for 2023, price forecasts will be at the forefront of many people’s minds, however, it is difficult to predict for the next 12 months when there is so much unrest in the economic markets. This will without a doubt have an impact, and interest rates rising as suddenly as they have has seen many buyers halt their searches while we see what the next few weeks hold, or they have to re-evaluate their borrowing as a result of this. This has seen demand fall by around 15% from a year ago, but still up 20% on the last ‘normal’ market we saw in 2019, there is without question still a propensity to move, but a purchaser’s ability to do so has now been thrown into the equation.”
Residential Lettings – Lorna White, Associate
“The letting market values continues to rise with the national average of rent being £1162pcm, which is showing a 3.2% rise over the last quarter. The northeast is showing an average rent of £779pcm, with a percentage increase slightly over the national average at 3.6%, this enforces that the rental market in the area is still extremely strong and continues to be as buoyant as ever.
These figures show that the rental market in the northeast is showing no signs of slowing up, and the annual increase now in this area is 11.5%, which is again over the national average of 11%. We are still finding asking rents increasing, this quarter they have jumped up a further 3%, only the third time on record this has happened.
We are seeing more rental properties becoming available onto the market which is helping bridge the gap between supply and demand, however, the demand is still overweighing the number of houses coming onto the market. The tenant demand is up 20% compared with last year’s figures, and available properties are down 9% in the same period, so although the gap is getting smaller this is still a great time to rent your property.”