Burton Property Market Update - April
Third consecutive price record & homes selling faster than ever in spring market frenzy - we take a look at the Burton Housing Market through April.
According to Rightmove; The price of property coming to market hits a new record high for the third consecutive month, up by 1.6% (+£5,537) to £360,101
Despite growing economic headwinds, the 2022 market continues to set new milestones for price and activity levels:
53% of properties are selling at or over the full asking price, again the highest level ever seen
ECONOMY
Average weekly earnings for full-time employees were £611 in April, up 4.3% year-on-year, growth at its highest sine 2008. Across all jobs weekly earnings, when adjusted for inflation, increased 3.6% in real terms in the year to April (ONS).
Inflation rose to 7% in March, with prices rising at their fastest rate for 30 years. Fuel prices were the biggest contributor to the rise, recording the largest monthly increase since records began. The Bank of England next meet on May 5th, where they will decide whether to raise interest rates from 0.75%.
The Bank of England have raised interest rates back to their pre-pandemic level of 0.75% as it aims to calm the rising cost of living which is at its highest rate in 30 years. At 2.02% the average mortgage rate remains lower than two years ago but household saving levels are now at their lowest level since the start of the pandemic.
PRICES
Over half of all properties are selling at or above their asking price according to the latest reports released by Rightmove and the NAEA, the highest proportion ever recorded as the price of property coming to market hits a record high for the third consecutive month.
Significant buyer demand and a shortage of supply indicate that while price growth may slow any sustained price falls are unlikely. Spring is traditionally a busy time for the market, properties selling (from marketing to SSTC) on average in just 33 days (Rightmove)
The Halifax report the average price of a property across the UK rose by 1.4% between February and March, the largest monthly increase in 6 months. The average property has risen in value by over £43,577 since the first Covid-19 lockdown.
TRANSACTIONS
Close to 115,000 sales took place in March, the third highest March in the last decade (after 2021 and 2016. The HMRC estimate over 330,000 sales have taken place in the first quarter of 2022.
Over 290,000 property sales completed in the first quarter of 2022 according to new data released by TwentyCi. At present there are just over 172,500 properties for sale across the UK, with 237,500 properties sale agreed.
Properties are currently selling 20 days quicker than the long term average (Rightmove), with a significant proportion selling above initial asking price (Dataloft poll of subscribers). Needs-based buyers are the most active in the market place at the current time.
DEMAND
Close to 71,000 mortgages were approved in February, marginally higher than the 2016-2020 average. At £26.1 billion, the value of mortgage lending was, with the exception of a year ago, the highest February total since 2008 (Dataloft, Bank of England)
Rightmove report there are now twice as many buyers as sellers in the market place, as the asking price for a newly marketed property has hit another record high.
Following research with consumers the National Trading Standards Estate and Letting Agent Team have announced that from the end of May a property's council tax band or rate (for lettings and sales) and tenure and price information (for sales) must be included on all property listings.
INVESTMENT/LETTINGS
Rental values continue to rise across all regions of the UK, annual growth currently strongest in the East and South West. Demand for property continues to outpace supply creating sustained pressure on prices.
Rental values across all regions of the UK are expected to rise over the next three months, with surveyors projecting annual growth of 4.5% Rents are anticipated to rise by an average of 5% per annum over the next five years (RICS).
Nearly 1 in every 7 property sales (13.9%) across Great Britain in Q1 2022 were to Buy-to-Let investors, the highest proportion since the introduction of the 3% SDLT levy in 2016. Research by Hamptons indicates for the first time since 2016, investors bought more properties than they sold.
DEVELOPMENT/NEW BUILD
Over 250,000 new homes were built in England and Wales in 2021. 84% of properties received an EPC rating of 'A' or 'B', according to the latest data released by the Department of Levelling Up Housing and Communities.
From 30th June, landlords will be banned from charging ground rent on most new residential leases in England and Wales. Many developers have already cut ground rent to zero for new home buyers in advance of this legal change.
Over 35 property developers, who account for nearly half of Britain's new homes, have signed a legally-binding agreement to “fix all unsafe tall buildings [over 11 metres constructed] they have had a role in developing”, within the last 30 years. They have committed more than £2bn, an extension to the Building Safety Levy set to raise another c.£3bn.
PRIME MARKETS
The Economic Crime Bill has received Royal Assent. The Bill includes the establishment of a register of overseas entities (ROE) that own property in England and Wales with foreign owners of UK property have six months to comply with new regulations and will be required to update/confirm their records every year.
94% of prospective buyers looking for prime market (+£1 million) property state a lack of stock is hampering their ability to buy. LonRes report the number of properties available to purchase across London's prime postcodes was 16% lower year-on-year in January.
In London, the number of planning applications to build tall towers dropped by more than 13% in 2021 compared to a year earlier. Just 72 applications were received for buildings of 20 or more storeys.. The number has been in decline since 2018 (New London Architecture).
DO YOU GET OUR WEEKLY BURTON MARKET UPDATES
Follow us on Facebook for Andrew and Lauren's weekly breakdown of what's happening in the Burton Property Market covering DE11, DE13, DE14 and DE15.
Each week Andrew and Lauren look at the latest market activity and discuss some of the new properties coming to market.
All the best.
