Author: Marketing

The average house price in Britain has surged above £350,000 for the first time ever as buyer demand outstrips the amount of homes on sale.

House sellers were typically asking for £354,564 for a property in March, up £5,760 on February levels in the biggest monthly price hike since 2004, according to data from property platform Rightmove.

The average price last month was also 10.4 per cent higher than the same time last year, the sharpest annual rise that Rightmove has recorded in any month since June 2014.

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Rightmove said that house prices had been stoked by the biggest mismatch between buyer demand and supply ever recorded, with more than double the amount of buyers as sellers currently active in the market.

But the firm’s director of property data Tim Bannister said the boom may settle in the coming months as economic pressures begin to bite.

“There are headwinds that seem likely to remove the current market froth in the second half of the year,” he said.

“We’ve just seen interest rates rise again, and there are further incremental increases forecast for the year which will raise mortgage rates for some.”

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Soaring Inflation and a looming cost of living crunch were also likely to affect buyer affordability and market sentiment in the coming months, Bannister said.

So-called ‘top-of-the-ladder’ homes were currently weathering the biggest jump in prices, with four bedroom or more properties recording an average jump of £23,619 due to the high demand and greatest scarcity of supply.

Despite the sharp rise in asking prices from sellers, agents have reported having to slash initial prices as prospective buyers are left “underwhelmed” by over-optimistic sellers, Rightmove said.

By CHARLIE CONCHIE

Source: City AM

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Every month for the last year, annual house price growth has climbed. This is the longest stretch of year-on-year rises since the beginning of 2017 as London enters a strong spring sellers’ market.

The annual rate of growth in asking prices has increased every month since April 2021. This means the marketed price of a London home is 6.3 per cent higher this March than 12 months ago, taking the average to £664,400. From February 2021 to February 2022, the increase was as much as 7.3 per cent, up from 4.2 per cent from January to January.

The last time the capital recorded a sustained stretch of uninterrupted growth was from September 2009 to February 2017, according to the latest Asking Prices Index from Rightmove.

The time it takes to sell a property in London also dropped from 68 days to 57 this February after a high of 71 days in the same month last year – another indicator that the London housing market is restarting after the pandemic.

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During the Covid-19 crisis many young workers and families chose to move out of Britain’s cities and into smaller towns and villages which quashed sales in the capital, especially in the inner boroughs.

However, following the vaccine roll-out programme, the reopening of culture and hospitality, the return to the office and the re-emergence of overseas buyers, activity is picking up.

How long it takes to sell a property in London

Month	No. of days
February 2021	71
March 2021	64
April 2021	57
May 2021	57
June 2021	57
July 2021	55
August 2021	58
September 2021	57
October 2021	57
November 2021	59
December 2021	63
January 2022	68
February 2022	57

Although the emergency stamp duty holiday ended in the autumn, demand to move in the UK has remained at a record high as the home moving boom continued to grip the whole nation, the report also shows.

The average price of property coming to market rose 1.7 per cent this month to £354,564 – breaking through the £350,000 threshold for the first time. This is the largest monthly rise for March since 2004 with an annual increase of 10.4 per cent.

The time it takes to sell on average in the UK fell from 44 days in January to 36 in February. The number of days from offer to completion was as low as 25 days in Scotland and 30 days in the south west of England.

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“This unprecedented price level is being stoked by the greatest imbalance between buyer demand and the number of properties available for sale that we have ever measured at this time of year,” says Tim Bannister, analyst at Rightmove. “This is the strongest spring sellers’ market that we have ever seen in several metrics,” he adds.

There are now more than twice as many buyers as sellers active in the market, which is the biggest mismatch between supply and demand that the property portal has recorded in its two-decade history.

In fact, 22 per cent of properties listed on Rightmove go under offer within the first two weeks of marketing – twice as many as in the pre-pandemic market of 2019.

“Usually buyer demand pauses in February for half term and then we see a slight break ahead of the spring but this year buyer enquiries picked up back straight away,” says Patrick Rampton of Rampton Baseley in Clapham. “There is pent up demand in the London market from Brexit and the pandemic, and with rising interest rates people want to secure a mortgage deal now. We might have half the stock but we are selling everything,” he adds.

Bannister stresses that now is the right time for cautious sellers who have been waiting for the pandemic to settle down but want to move ahead of rising interest rates and inflation. Although, the Rightmove business model is based on the listing of homes for sale.

Strutt & Parker’s Kate Eales believes despite historically low stocks, spring sellers are starting to emerge.

By Anna White

Source: Evening Standard

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Scottish average property prices increased by almost 10% in 2021, led by growth in the cost of larger homes, according to an analysis of the latest data by property firm DJ Alexander.

The estate agency, part of the Lomond Group, said that between January 2021 and December 2021 average property prices in Scotland rose by 9.5%, led by gains in Edinburgh.

The Scottish capital experienced the largest average increase at 10.6% with Aberdeen the lowest among Scotland’s largest cities at just 2.2% with Dundee up 9.5% and Glasgow increasing 8.3%.

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However, it is the increase in average prices for detached, and semi-detached homes which is most striking with double digit growth in all cities with the exception of Aberdeen whose detached homes increased by a healthy 8.1% – an increase of £27,318 – but were lower than the rest of Scotland due to continued uncertainty over the future of the oil and gas sector.

Detached homes across Scotland increased by an average of 15.4% which is a £44,182 increase on 2020. However, Edinburgh topped the market overall with an average annual increase of £110,181 in the price of detached homes which equates to a rise of 18.3% year-on-year.

Glasgow had the second highest increase with a rise of 17.8% which is an average £67,067 higher over the year with Dundee increasing 15.1% which is £41,843.

Semi-detached and terraced properties experienced strong double-digit growth in Edinburgh and Glasgow, while Dundee’s largest properties also recorded high increases over the year. Flats had the lowest growth with a 4.1% increase in average prices across Scotland ranging from a rise of 7.8% in Edinburgh to a fall of 0.9% in Aberdeen.

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David Alexander, chief executive officer of DJ Alexander Scotland, commented: “These figures reflect a very mixed picture across Scotland. While it is positive that there has been an overall substantial rise in average prices in the country it is clear that there are major differences in the performance of the market both geographically and by property type.

“Aberdeen remains flat and is unlikely to improve until there is some clarity over the future of the oil and gas industry. However, even despite the economic uncertainty the strength of pricing for the largest homes in Aberdeen remains the strongest sector even in the weakest city market.”

He continued: “Edinburgh’s continuing popularity is remarkable and the increase in average pricing for detached houses is extraordinary. An increase of £110,000 on average for detached properties in just one year is unprecedented and, I would have to say, unsustainable in the long term. The buoyancy of the market has been unbelievable and the money available to pay these substantial amounts for property shows that the strength of Edinburgh’s property market has both deep roots and deep pockets.

“Glasgow and Dundee have also had a remarkable year with larger properties producing outstanding growth in 2021. With Edinburgh and Glasgow both having a near 20 per cent rise in average property prices for detached and Dundee at just over 15 per cent we can see that the top end of the market remains strong across Scotland which is a welcome outcome.”

Alexander added: “I believe that these figures represent a peak since, for me, there is really only one way for them to go in the next couple of years. There won’t be a sudden fall or drop in the market as the number of properties available remains woefully low, but I don’t think that substantial increases of this scale are sustainable in the medium to long term.

“I think we will continue to have positive growth but nearer the historic levels of between three and five per cent a year with outlier pockets of stronger activity continuing to surprise and make headlines but overall, a steadier market.”

By MARC DA SILVA

Source: Property Industry Eye

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The UK housing market remained buoyant in February, industry research showed on Thursday, despite rising interest rates and the growing cost of living crisis.

According the latest UK Residential Market Survey from the Royal Institution of Chartered Surveyors, a net balance of 17% of respondents said they had seen an increase in new buyer enquiries in February, the sixth consecutive month of increases.

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The number of agreed sales also rose, with a net balance of 9%, the strongest reading since May 2021.

House prices continued to rise over the month, with a net balance of 78% reporting an increase at the national level. Stock levels remained close to historic lows, however, which RICS said was a “major factor” in sustaining house price inflation.

Simon Rubinsohn, chief economist at RICS, said: “Huge clouds of uncertainty hang over the economic prospects as energy prices continue to surge and the Bank of England grapples with how to manage monetary policy in this challenging environment.

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“Despite all this, there is little evidence yet that the mood music regarding the expectations for house prices or rents is shifting. Indeed, the medium-term projections from respondents to the RICS survey are continuing to gain momentum.”

Looking to the next three months, respondents predicted that sales would increase, although at a more modest pace, with February’s net balance of 11% down on January’s reading of 20%. Sales were expected to remain on an upward trajectory over the coming year, however.

The BoE has increased interest rates twice since December, to 0.5%, as it looks to tackle soaring inflation, currently running at a 30-year high. Energy prices, meanwhile, will rise by 54% from next month, alongside a planned increases to national insurance contributions.

By Abigail Townsend

Source: Sharecast News

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UK house prices are continuing to increase as a result of the lack of new properties being listed for sale as new buyer enquiries rise, but there are emerging signs that growth could start to slow.

Property prices in Britain hit a new eight-month high in February as the housing market showed little sign of losing momentum amid a growing living cost squeeze.

The Royal Institution of Chartered Surveyors (RICS) said a net balance of +79% of its members reported a rise in house prices in February, up from +74% in January and its highest since June.

House prices continue to rise significantly, despite the phasing out of temporary stamp duty break on property purchases in the second half of 2021.

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But with household budgets being squeezed by high inflation and imminent tax rises, RICS had doubts about whether existing house price growth could continue at the existing rate.

“Huge clouds of uncertainty hang over the economic prospects as energy prices continue to surge and the Bank of England grapples with how to manage monetary policy in this challenging environment,” said Simon Rubinsohn, RICS chief economist.

“Despite all of this, there is little evidence yet that the mood music regarding the expectations for house prices or rents is shifting.”

Expectations for house price growth in the coming 12 months were strong cross all parts of the UK, the survey showed.

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Rents were expected to increase by an average 4.5% over the next 12 months. The proportion of surveyors expecting rents to rise was the highest since December 2012, RICS said.

The supply-demand imbalance is likely to keep prices high, but there are signs that growth will start to slow.

Tom Bill, head of UK residential research at Knight Frank, said: “We are presumably witnessing the final few months of double-digit house price growth before supply picks up and demand begins to fray around the edges. UK house prices have been skewed by a lack of supply in recent months but the shelves are gradually re-stocking, a process accelerated by the arrival of spring.

“Meanwhile, higher inflation and rising mortgage rates will begin to put the brakes on sky-high demand. It won’t happen overnight but I would expect the return of single-digit house price growth later this year. While the Bank of England may adopt a more risk-averse approach to raising the base rate given the geopolitical uncertainty, mortgage rates are still playing catch-up and lenders are likely to keep withdrawing their best products.”

By MARC DA SILVA

Source: Property Industry Eye

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UK house prices are growing at their fastest rate since before the global financial crisis, according to Halifax figures, which said prices rose by 0.5% in February, equating to £370 a week.

The housing market is continuing to defy economic conditions, with the typical property notching up its biggest annual cash gain since the lender’s index began.

Prices last month were 10.8% higher than their level in February 2021, the highest annual growth rate since June 2007, as prices hit a new record high of £278,123.

Russell Galley, managing director at Halifax, said: “The UK housing market shrugged off a slightly slower start to the year with average property prices rising by another 0.5% in February, or £1,478 in cash terms.

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“This was an eighth successive month of house price growth, as the resilience which has typified the market throughout the pandemic shows little sign of easing.

“Year-on-year prices grew by 10.8 per cent, the fastest pace of annual growth since June 2007, pushing the average house price up to another record high of £278,123.

“Two years on from the start of the pandemic, average property values have now risen by £38,709 since February 2020. Over the last 12 months alone house prices have gained on average £27,215.”

“This is the biggest one-year cash rise recorded in over 39 years of index history,” Galley added.

The average house prices across the UK in February, with the annual increase:

– East Midlands, £228,289, 11.6%

– Eastern England, £325,687, 11.4%

– London, £530,469, 5.4%

– North East England, £160,874, 9.9%

– North West England, £212,920, 11.1%

– Northern Ireland, £173,911, 13.1%

– Scotland, £193,777, 9.2%

– South East England, £378,441, 10.5%

– South West England, £293,968, 13.4%

– Wales, £207,184, 13.8%

– West Midlands, £234,481, 9.7%

– Yorkshire and the Humber, £192,010, 9.8%

Source: Halifax

The supply-demand imbalance continued to underpin rising property prices, but looking ahead, as Covid moves into an endemic phase and almost all domestic restrictions are removed, geopolitical events expose the UK to new sources of uncertainty, according to Galley.

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He added: “The war in Ukraine is a human tragedy, but is also likely to have effects on confidence, trade and global supply chains.

“Surging oil and gas prices are one immediate consequence, meaning that inflation in the UK – already at a 30-year peak – will remain higher for longer.

“This will add to the squeeze on already stretched household incomes. While increases in bank rate look likely in the near term, the extent of the rises will depend on how it affects prices and companies’ approaches to pay over the months to come.

“These factors are likely to weigh on buyer demand as the year progresses, with market activity likely to return to more normal levels and an easing of house price growth to be expected.”

Wales remained the strongest-performing area, with annual property price growth of 13.8%, taking the average property price there to £207,184.

London was once again the weakest-performing area of the UK, with annual house price growth of 5.4%, but average prices remain high.

Tom Bill, head of UK residential research at Knight Frank, said: “We are presumably witnessing the final few months of double-digit house price growth before supply picks up and demand loses some of its lustre.

“A lack of stock has been a feature of the UK property market since the stamp duty holiday ended last summer but the shelves are gradually re-stocking, helped by the arrival of the spring market.

“Meanwhile, higher inflation and rising mortgage rates will begin to put the brakes on sky-high demand. It won’t happen overnight but I would expect the return of single-digit house price growth later this year.”

Nathan Emerson, Propertymark CEO, commented: “Estate agents are still reporting bidding wars and buyers who are migrating. Migration means that some buyers can bring with them a larger budget, especially if they are moving away from a city which can filter through to higher purchase prices.

“Many buyers who have lost out are still waiting in the wings. In January, our agents reported registering an average of 100 new potential buyers per branch. Coming into February we have seen an increasing number of valuation appointments and we are hopeful that more sellers will come to the market which will help to ease price rises.”

Iain McKenzie, CEO of The Guild of Property Professionals, commented: “The country is going through a cost-of-living crisis, plagued by rising inflation and plunging consumer confidence – but nobody seems to have told the housing market.

“It’s incredible to think that these latest figures show the fastest annual growth in 15 years and another record high for the average house price, which continues to climb towards £300,000.

“Month after month we have seen house prices continue to rise, and it is difficult to imagine this upward trend reversing while demand continues to outstrip supply.

“However, we are still expecting some correction in the market this year as the cost of living crisis finally reaches the property market and slows house prices.

Jeremy Leaf, a north London estate agent, said: “Prices may be continuing to rise to record levels but looking behind the numbers we are finding in our offices that this is more as a direct result of lack of choice, which is also compromising the number of transactions.

“Prices are unlikely to continue their mighty gains as affordability is becoming increasingly stretched, with events in Ukraine likely to send inflation and especially energy costs even higher.”

By MARC DA SILVA

Source: Property Industry Eye

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