January market snapshot
Our teams enjoyed their Christmas holidays, they were under no allusions, it would be busy on their return, and so it has proven to be so far this January. Early days but all signs suggest Bristol's property market is set to remain extremely busy.
The ONS report the UK economy surpassed pre-Covid levels for the first time in November. However, growth is liable to have slowed in December due to the spread of the Omicron variant and the introduction of Plan B measures.
The Bank of England warn inflation could rise as high as 6% during 2022 before falling back in the latter half of the year. Inflation rose to 5.1% in November, its highest rate in 10 years, prompting a rise in interest rates to 0.25%.
Markets are predicting a further interest rate rise to 0.5% in late Spring with rates increasing to 1% by the end of 2022. However, the impact of the Omicron variant on the UK economy is as yet unknown.
Close to 67,000 mortgages were approved in November, with the exception of 2020, this was the highest November total since 2016 (Bank of England). Mortgage approvals January - November are over 21% higher than the long term average (2013-2020).
Strong demand and continuing low numbers of available homes for sale set up the housing market frenzy to continue into the start of 2022, with early-bird sellers benefitting from increased buyer competition. According to Rightmove the number of buyers enquiring about homes is 15% higher than at the same time last year. As a result, competition among buyers is almost double what it was at this time last year. However, there are early signs that more property choice is on its way, with the first working week of 2022 being the busiest start of the year ever for people requesting agents to come out and value their homes.
The average property has increased in value in the region of £24,000 over the past year according to both the Nationwide and Halifax. Nationwide report the average price of a property is now 16% higher than before the COVID-19 pandemic.
The average price of property coming to market jumps by 0.3% this month (+£852) to £341,019, which is 7.6% higher than in January 2021, the highest annual rate of price growth recorded by Rightmove since May 2016. First-time buyer asking prices hit a new record of £214,176 after a monthly jump of 1.4%
Tim Bannister, Rightmove’s Director of Property Data comments: “New Year sellers and buyers have been quick off the mark this year, with Rightmove recording the highest ever number of Boxing Day sellers coming to market. These early-bird sellers who got themselves ready to come to market are now benefitting from the busiest start to the year that we’ve ever recorded, with the number of prospective buyers enquiring about homes up 15% on this time last year. All of the signs suggest that prices are likely to continue to rise until more choice is available. Three regions are in most urgent need of new supply, the East Midlands, South West and South East of England, as they are now at unsustainable rates of annual price growth above 10%.”
Competition among buyers for available homes also remains strong as we move into 2022, with 15% more enquiries from would-be buyers to estate agents than at the same time last year. With both more enquiries from buyers and fewer properties available, the overall level of buyer interest per available property is almost double what it was at the start of 2021, which was itself a very active market. As a result, more than 70% of the properties currently on estate agents’ books have already been sold, leaving less than 30% still available to buy.
Bannister says: “It’s clear that the trends which defined the market in 2021 have carried over into this year. That being said, we are seeing early signs of a better balanced market in 2022. The number of requests from would-be sellers to agents to value their home has continued to increase from the end of last year and was at one of its highest points ever on the first working day of this year. While this potential new supply will take a little while to appear on the market, it’s an encouraging sign of more choice for buyers in the coming months. The speed at which we’ve seen the fresh choice that has come to the market being snapped up by eager buyers over the past 18 months is a reminder to buyers to move fast and book a viewing with the estate agent as soon as a property that could be the one for you comes to market.
Mon 17 Jan 2022