11 Apr Housing Market
HOUSING MARKET IN THE UK
The housing market over the last twelve months has seen six new record highs in regards to properties coming to market, this is due the disparity between supply and demand in the housing market which is driving prices upwards. However, this month with the new stamp duty changes has seen sales fall for the first time in 18 months this still hasn’t affected the price of new homes coming to the housing market hitting an all time high with the average new home being priced at £300,000. This has become a massive worry not only for first-time buyers but home buyers in general with the affordability gap growing and growing. Today’s asking prices are now over 50% higher than 10 years ago.
Rightmove stated that the start 0f 2016 has seen an encouraging but modest amount of properties hitting the market, demand has pushed prices over the £300,000 mark. Since the start of the year, an average of 30,000 properties have hit the market per week which is up 3% on this time last year, but there are insufficient numbers coming onto the market in certain high demand areas. Buyers are hitting the website 14% more than this time last year in 2015, this shows that buyers aren’t struggling to borrow money or to find that extra cash to keep this merry-go-round spinning.
With the 50% increase in values from 2006 to today has made the struggle of getting onto the property ladder a lot harder even buyers looking to trade up the ladder are struggling. Even with this timespan including the financial recession, properties saw a drop of 20% in some areas which caused the housing market to stagnate, this just proves how strong the housing market recovery has been from an average of £200,980 in 2006 to today’s average of £303,190 that’s a massive £100,000 increase in 10 years. The problem we have as house buyers is that property prices have increased by 50% but the average wage increase is only 22% which is 4.8% below inflation at 26.8%. This highlights the issues with getting funding in place to purchase a property. The recovery has been put down to underlying demand and the insufficient available stock in many locations.
The housing markets national average of properties coming to the market at this time of the year is up 1.3% which is the second highest since 2008 financial recession. With the £300,000 mark being broken has mainly been driven by the London housing market. The upwards trend is spreading North and West with six out of the ten regions achieving record asking prices. All of the southern regions are joined by the West Midlands and the North West, with the East Midlands only £373 shy of an all-time high.
Three out of the top four are northern regions which are the biggest risers this month a lot of these regions are stuck in the slip stream of the South West and ahead of the southern regions. London housing market is slowing and is a former power house which has driven up the national average, certain boroughs are doing well but are cancelled out by others which aren’t.
It seems like stock levels across the country seem to be historically low, even though seller levels have been up on last year, demand far outstrip supply. Valuations requests are up 78% compared to this time last year, also a record number of new listings in January and February. There definitely has been a surge in house prices at the start of 2016 which is expected at this time of the year but also the fact that as of April 1st a 3% stamp duty charge for 2nd homes and investor properties has forced investors to buy before the dead line. Last year saw sales fall across all London areas but least of all in zones 3-6, prices do continue to rise.