Your monthly UK housing market update – including sold and asking prices, RICS surveyor sentiment and predictions for the year ahead.
HM Land Registry – Sold Prices
The latest UK House Price Index reports that house prices increased by 9.5% in the year to September 2022. This is substantially down from the 13.1% witnessed in August.
This percentage fall is because UK house prices remained unchanged between August and September. To put these figures in perspective, prices rose by 3.3% during the same period (August and September 2021) a year earlier.
This lull is an oddity for a year that’s seen average sold prices reach record levels, month after month.
Nonetheless, the Bank of England note demand from prospective homebuyers still outstrips supply. But the number of transactions is slowing. In September 2022, there were 103,930 transactions on residential properties, which is a massive 36.8% lower than the previous year.
Painting an uncertain picture, mortgage approvals (a good indicator of future borrowing) also dropped from 74,400 in August 2022 to 66,800 in September 2022.
Rightmove – Asking Prices
In November 2022, asking prices dipped by 1.1% (down by just over £4,000) to £366,999.
This is normal for November, as sellers are pricing competitively to try and find a buyer before the end of the year. Indeed, Rightmove also saw a drop of 1.1% every year between 2015 and 2019.
While buyer demand is still higher than the pre-pandemic years, the market is much more price-sensitive now, compared with the 2020 and 2021 buying frenzy.
The first time buyer sector is still facing the biggest challenges after the sudden jump in mortgage interest rates. As a result, demand is down by 26% on the same time last year (though still up by 7% on 2019).
“Second-stepper” homes have seen a drop in demand of 17% while “top of the ladder” properties witnessed a drop of 15%. As a whole, buyer demand is still up by 4% on 2019 – but 20% down on October 2021.
RICS – Chartered Surveyor Sentiment Survey
Reflecting trends identified by Rightmove, the latest RICS UK Residential Survey points towards a further downwards trend in buyer enquiries and sales.
New buyer enquiries sank for the sixth month in a row, as the headline balance plunged to -55% (down from -36% for September 2022). New listings have also remained in decline, with a net balance of -17% of respondents seeing a diminishing trend.
Taken together, these factors led to -45% of contributors reporting a fall in sales over October 2022. Market appraisals were also down, slipping to -37%.
House price growth also ground to a halt over the month. The national net balance came in at -2%, marking an end to the previous sequence of 28 positive monthly reports! Showing the extent of this drop, October’s negative reading was down from +30% seen in September.
As a result of the increasingly gloomy economic picture, sales expectations for the year ahead remain around -42%.
Zoopla – Housing Market Outlook
In their latest market report, Zoopla expect house price falls of up to 5% over 2023. They predict these declines will be felt most in the high-value property sector, where buyers are more sensitive to higher borrowing costs.
In addition to these price drops, Zoopla also forecast a decline in sales volumes over 2023, falling to around one million sales. They note how the market has become less reliant on high loan-to-value mortgages (i.e. mortgages with a deposit of 10% or less).
Instead, a broad range of housing needs is now supporting moves – an under-reported yet incredibly significant shift in the property market over the last decade.
Express Index
For a full, comprehensive breakdown of current property market activity. Visit our Express Index here
Are you thinking of putting your home on the market?
We specialise in helping you get more for your property. Quicker, easier and with less stress.
You can call us any time on 0333 016 5458 where we can provide help, guidance and support.
Instant valuation – get a free 32-page instant valuation report here
Video appointment – book a free, no-obligation 30-minute advice meeting with one of our experts here
Ready to instruct us? – locate and sign your agreement here