Real estate market continues to defy predictions – Show House

With annual house price growth at its highest level in 17 years and a record number of properties sold under contract (SSTC) in the first week on the market, the housing market continues to defy the odds. That’s according to Nicky Stevenson, MD of Fine & Country UK, who adds that while many expect a more balanced market to emerge over the course of 2022, there are still few signs of a change in direction.

“The number of buyer inquiries per property for sale is traditionally highest in March, April and May, 2022 being no exception. With the biggest mismatch between demand and supply at this time of year on record, Rightmove’s report says more than one in five properties are currently moving from listing to sale subject to contract (SSTC) in just one week and almost half in two weeks. It is estimated that 75% of properties successfully find a buyer, compared to a historical average of around 50%,” says Stevenson.

She adds that the average price of a property coming on the market has broken through the £350,000 barrier, while Nationwide reports that, at 14.3%, annual price growth in the year to March is at its highest. high level since November 2004. “With strong competition for available properties, many sales are subject to ‘best final offers’ and almost 40% of properties are selling at or above the asking price.

“Despite concerns that a lack of properties for sale will impact transaction levels, sales and mortgage approvals to date in 2022 are above the longer-term average seen between 2017 and 2021. Plus, year-on-year price growth is evident across all major markets in England and Wales,” comments Stevenson.

She goes on to say that at the end of 2021 the UK economy was only 0.1% below its pre-Covid level at the end of 2019. However, the Chancellor, in his spring statement, said warned that the global economic outlook is “difficult”. “The Office for Budget Responsibility has lowered its forecast for UK economic growth in 2022 to 3.8%, significantly below October’s forecast of 6%. Reports show that consumer confidence has also fell for the fourth consecutive month, as pressure on household finances increases.

Record food, fuel and energy prices are expected to lead to average inflation of 7.4%, peaking at over 8% in the last quarter, while wage growth is expected to be 5.2%. In a bid to calm the price spiral, the Bank of England raised the base interest rate for the third time in four months to 0.75%, still low by historical standards, but further hikes are in sight. expected. While many households will benefit from a council tax refund and changes to the National Insurance threshold, the ONS reports household savings levels are now at their lowest level since the start of the pandemic,” says Stevenson.

“With rising energy and fuel costs, we are likely to see more buyers consider energy-efficient properties. According to new research from Aviva, 37% of adults said they would consider the energy efficiency of their next home, a huge increase from the 22% who did for their current home,” says Stevenson. “A much higher proportion will consider the condition of the double/triple glazing, as well as wall and roof insulation More than 25% would like to buy a home with a renewable energy source and 22% would like an electric vehicle charging station Energy efficiency is one of the main reasons why people are considering new construction, virtually all of which are EPC “A” or “B” rated.

“While nearly half of current homeowners think major eco-changes would be too costly, the government’s announcement of 0% VAT on materials and the installation of energy efficiency equipment for houses could make some owners reconsider,” she concludes.

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Penny D. Jackson