March market snapshot
Bristol's property market remains extremely busy with unprecedented demand for both property for sale and to let. There are undoubtedly pressures for those searching for their next home, with lack of supply resulting in further price increases. There are certainly positive indicators suggesting more property to sell is coming to market. Our offices have been invited to value record numbers of property to sell in recent weeks, and we are very happy to bring increasing numbers of new instructions to the market across the whole of the city.
We can be sure the traditionally busy Spring market will be exceptionally busy, we are expanding our teams and making every effort to ensure we continue to offer the best possible advice, help and assistance for all customers in what will be a hectic time for all home movers.
Let's look at the headlines
Another new price record has been set as the average price of property coming to market jumps by 1.7% (+£5,760) this month to £354,564, breaking through the £350,000 barrier for the first time
The average monthly rise is the largest seen at this time of year since March 2004, pushing the annual rate of increase to 10.4%
The most expensive sector of four bedrooms plus sees an average 3.8% (+£23,619) monthly price surge encouraging new sellers to come to market, with 12% more new listings in this sector than at this time last year
We enter the spring selling season with the biggest mismatch between supply and demand for this time of year ever measured by Rightmove, with more than twice as many buyers as sellers
At 10.8%, the Halifax report annual house price growth in the year to February is at its strongest level since June 2007. Prices are continuing to rise month-on-month according to all the major house price indices.
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. This is the strongest spring sellers’ market that we have ever seen in several metrics.
Tim Bannister, Rightmove’s Director of Property Data comments: “There’s a hat-trick of reasons for home-owners to follow the normal trend and make it their goal to sell this spring. Firstly, the potential to achieve a record price for their property. Secondly, the imbalance between high buyer demand compared to low available property supply is the greatest that we have ever seen for the start of a spring market, meaning that the chance of being able to pick and choose between several suitable buyers is strong. Thirdly, the proportion of properties finding a buyer within the first week is also at an all-time high for this time of year, so sellers with an appropriately priced and well-presented property can expect a shorter marketing period than the norm. Those who weren’t ready to take advantage of last year’s rush now have another chance to get on the market while these conditions last. Many of those who are selling in this record-breaking market obviously also face the prospect of buying again in the same market, and being in fierce competition against other buyers. Having a buyer for your own property, subject to contract, puts those who are buying again in a powerful position compared to buyers who have yet to sell, and agents report that these ‘power buyers’ are more likely to get the property that they want and negotiate the best deal on price.”
The largest monthly price rise has been recorded in the “top of the ladder” sector, predominantly comprising four-bedroom or more properties. This has seen a 3.8% (+£23,619) jump due to high demand and the greatest scarcity of supply, though encouragingly for prospective buyers in this sector 12% more properties have come to market in the last month compared to the same period a year ago. However, it’s the more mass-market “second-stepper” sector that’s selling fastest, with just over half (50.3%) of these homes finding a buyer within the first two weeks of marketing.
The Bank of England has raised interest rates back to their pre-pandemic level of 0.75%. This represents the third rise in four months as the Bank aims to calm the rising cost of living. And inflation, the cost of living rose to 6.2% in February, its highest rate in 30 years as fuel, food and energy costs soared. Cost of living rises now considerably outpace wage growth placing pressure on household incomes.
Nearly 74,000 mortgages were approved in January 2022, with the exception of 2021 the strongest start to the year since 2014. At £23.8 billion, lending levels were just 2% lower than a year ago as remortgage activity continues apace.
Properties are currently selling 20 days quicker than the long term average (Rightmove), with a significant proportion selling above the initial asking price (Dataloft poll of subscribers). Needs-based buyers are the most active in the marketplace at the current time.
Buyer demand continues to gain momentum (RICS, February 2022), the net balance of agents citing an increase in demand at its highest level since May 2021. Sales activity is expected to pick up modestly in the near term.
Over 150,000 new homes were registered in 2021, up 25% on pandemic hit 2021 but 2% lower than the 5-year (2015-2019) average, detached homes seeing the largest increase and accounting for over one-third of all registrations (NHBC)..
The UK construction sector continued to gain momentum in February, with growth led by an accelerated rise in housing activity. House building replaced commercial work as the best performing category, posting its strongest increase in 8 months (IHS Markit/CIPS).
Stuart Andrews has been appointed as the government's new Minister of State for Housing within the Department of Levelling Up., Housing and Communities. He becomes the 7th housing minister in the past five years.
Wed 23 Mar 2022