Our monthly update on the UK housing market – covering sold and asking prices, current market sentiment as well as the property outlook for the year ahead.
HM Land Registry – Sold Prices
UK house prices increased by 10% in the year to November, reflecting a rise of 1.2% from the previous month. This is roughly comparable with trends witnessed in 2020, when sold prices grew by 1% between October and November.
Price growth remained strongest in Wales for the second consecutive month (up by 12%). Contrastingly, London sold prices increased by just 5.1% in the year to November 2021.
The Bank of England’s Agents Summary of Business Conditions identifies the continued shortage of fresh listings as underpinning strong buyer demand and price growth.
The number of residential property transactions was 16.4% lower during this period than a year ago (at 96,290 sales). Despite this, transactions did rise by 24.3% between October and November – signifying a market returning slightly closer to normal levels.
Rightmove – Asking Prices
In January 2022, early-bird sellers benefitted from the busiest ever start to a New Year! Average asking prices jumped by 0.3% over January. This reflects an increase of £852 to a total of £341,019.
This figure is 7.6% higher than January 2021, reflecting the steepest annual price growth since May 2016. First-time buyer properties were the fastest growing market sector, jumping by 1.4% (to hit a new record of £214,176).
Despite this, the number of available homes per estate agency branch dropped again to a new low of just 12. This fostered massive buyer competition, with the number of new buyer enquiries up by 15% on the previous year. As a result, 70% of properties currently on estate agents’ books are also listed as already sold!
There are hopes property stock levels may soon return to usual however, with home valuation requests up by 44% over the first week of January, compared to 2020.
RICS – Chartered Surveyor Sentiment Survey
The latest RICS Residential Market Survey for December 2021 notes a modest rise in new buyer enquiries. It nonetheless cites the continued lack of new listings as limiting sales volumes.
With these trends (reported for the majority of 2021) firmly entrenched, house price inflation showed little sign of easing. +69% of survey participants witnessed price increases, consistent with strong price inflation across the country. Price rises are expected to continue over 2022, albeit at a slower pace.
A net balance of +9% of respondents identified an increase in new buyer demand. At the same time, 14% of contributors noted a decline in new listings. Agreed sales consequently stood at -13% for December, reflecting a steeper decline from the previous month (-9%).
Even so, +14% of respondents foresee sales volumes returning to growth by March 2022. Reflecting yet more positivity, this figure increases to +16% for the year as a whole.
Hometrack – Housing Market Outlook
The ongoing “race for space” shows no sign of abating, pushing demand for houses to record levels. Despite this, pressure for flats is also beginning to rise sharply again, bolstered by international purchasers, relative affordability and the post-pandemic return to office-based work.
There remains a significant imbalance between supply of new homes and buyer demand. This will continue to drive price rises over the year ahead, balancing dampening factors such as economic uncertainty and interest rate rises.
As such, home values are expected to grow by 3% over 2022 as a whole. Price rises are predicted to be highest in the North West and East Midlands.
Hometrack also forecast 1.2 million completed transactions over 2022. Whilst this is down from the astounding 1.5 million transactions seen the previous year, it’s more comparable with average annual figures.
Express Index
For a full, comprehensive breakdown of current property market activity. Visit our Express Index here
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