February market snapshot
Property prices remained strong with 37% of available properties selling above the asking price in January nationally. And for Ocean offices 52% of properties sold above guide or asking price!
January 2022 have seen some lofty numbers, whilst stock remains limited in comparison to demand for Bristol, figures from Propertymark shows there was a sharp rise in the number of homes listed for sale with estate agents in January. Following three months of decline, there has been an average 80% increase in new instructions nationally. Registrations by buyers also rose by double December’s figure. And purchases by first-time buyers made up 29% of sales in January, up 107% from December and up 26% on January 2021. Let's take a closer look at the market right now.
The UK economy grew by 7.5% in 2021 despite a fallback in December due to the Omicron restrictions. This follows a contraction of 9.4% in 2020 as many sectors of the economy were forced to close due to the Covid-19 pandemic. The cost of living continued to rise in January, up 5.5% year-on-year. Higher clothing and footwear prices and fewer January sales helped push inflation upwards. Yet the property market remained very positive and certainly in our home city of Bristol.
The Office National Statistics report annual price growth in the year to December was 10.8%, its strongest end to the year since 2002. The average UK property has risen in value by nearly £27,000 over the course of 2021.
Rightmove's latest reporting.
Price of property coming to market rises by 2.3% (+£7,785) to a record of £348,804, the biggest monthly jump in pounds recorded by Rightmove in more than twenty years:
Prices are now 9.5% higher than a year ago, the highest annual rate of growth since September 2014
This new record means that average asking prices have now risen by nearly £40,000 in the two years since the pandemic started, compared to just over £9,000 in the previous two years. The pandemic continues to influence many home moves, with this month’s price growth driven primarily by the “second stepper” sector – those who may find themselves in need of more space and are now ready to move on from their first homes. Tim Bannister, Rightmove’s Director of Property Data comments:
“The data suggests that people are by no means done with their pandemic-driven moves. Such a significant societal event means that even two years on from the start of the pandemic, people are continuing to re-consider their priorities and where they want to live. As the final legal restrictions look to be ending soon, and more businesses are encouraging a return to the office for at least part of the week, we now have a group of movers who are looking to return closer to major cities, or at least within comfortable commuting distance of their workplaces. High demand and a shortage of available stock are supporting a rise in prices and a new record average asking price this month. The rising cost of living is undoubtedly affecting many people’s finances, especially those trying to save up enough for a deposit to get on the ladder or to trade up. However, despite rising costs and rising interest rates, the data right now shows demand rising across the whole of Great Britain, with many people determined to move as we head into the spring home-moving season.”
More potential buyers are sending enquiries to agents, with the number 16% higher than this time last year
New property listings are up 11% compared to the same period last year, suggesting more sellers are coming to the market before looking for a property to purchase, to avoid missing out on their next home
The number of people requesting a home valuation from an estate agent was up 11% in January compared to last year
We can certainly confirm that our 10 offices across Bristol are continuing to receive extremely high levels of enquiries from eager buyers. More importantly, we are very busy indeed meeting homeowners considering a move and bringing their property to market. We, fortunately, enjoy the opportunity to market a vast majority of homes we value and therefore expect to see a good volume of new property coming to market in the near future.
Mortgage approvals and lending in 2021 were at their highest levels since 2007. The Bank of England report close to 950,000 mortgages were approved in 2021, the highest yearly total since 2007. Mortgage approvals were up 15% on 2020 and 20% on 2019 totals. Buyer demand continues to gain momentum (RICS, January 2022), the net balance of agents citing an increase in demand at its highest level since May 2021. Albeit before the announcement of the interest rate rise, there remains much interest in the market.
And both Rightmove and Zoopla have reported busy starts to 2022. Rightmove report buyer demand was up 23% over the festive period compared to last year, Zoopla that demand in the opening weeks of the year was 49% higher compared to 2018-2021.
Close to 107,000 sales took place in January, with the exception of 2021, the strongest start to a year since 2007. The HMRC also revised upwards the sales volume for December 2021
Private rents across the UK rose by 2.0% year-on-year according to the latest data produced by the Office for National Statistics. Rental values rose in all regions of the UK except Wales. Excluding London, rents rose by 3.0%, the strongest since records began in 2016. Renter demand continues to rise sharply, a net balance of +64 of contributors to the RICS January 2022 survey noting an increase. This is the strongest reading since records began in 1999. The volume of new supply to the market remains subdued, a 4% rise in rental prices anticipated over the course of 2022.
Analysis of Companies House data by Hamptons indicates that 47,400 new buy-to-let companies were incorporated in 2021. There are now 269,300 such companies on record, 61% of which have been set up since the withdrawal of mortgage interest tax relief from April 2017.
A number of new measures have been published as part of the Building Safety Bill. These include ensuring leaseholders do not have to fund the removal of cladding, Leaseholders bills for works will be capped at £10,000 for most of outside London, £15,000 within the capital. Leases worth more than £2 million will be subject to maximum costs of £100,000.
The government has launched a consultation on amendments to the stamp duty regime. The consultation, which is open until 22 February, covers changing the way SDLT is calculated for purchases of mixed-use properties and a reform of the Multiple Dwellings Relief, available on the purchase of 2 or more dwellings.
Tue 22 Feb 2022