Here’s a quick overview of the property market this October.
According to the Nationwide, annual house price growth last month was still very strong at about 10%, although this was down from 11% in August, and no doubt supported by the tail end of the SDLT concession which has now come to an end.
It is interesting to note that the average house price has risen by over £28,000 since that stamp duty concession was introduced in July 2020. This is 12 times more than the average SDLT saving enjoyed by buyers! The average house price, at £267,587, has now crossed into a higher SDLT threshold too! So rather than helping struggling buyers, the concession has supported massive and possibly unexpected house price growth. Funny old world!
Over and above any concession, it would certainly seem that sheer confidence, coupled with alternative financing, strong employment, low interest rates, and an economy rebuilding itself are all playing their part in proving once again that British real estate remains an exceptionally strong investment – and a tax free one for most homeowners. Rents are up too – by 7.5% over the year (Source: Homelet)
Could this be why 44% of landlords are expecting to buy more properties this year? (Source FJP Investments).
So often though, the figures we see are already out of date by the time they are published by the Land Registry or a mortgage lender. Perhaps changes in asking prices might be a better indicator of the future than looking at the sales completion figures of the past. According to Rightmove, the average price of property coming to market hit a record high after rising by 0.3% last month (that’s a more modest annualised figure of 3.6%, which is about the same as many forecasters are predicting will be the average annual growth for the next couple of years at least).
So things are stabilising, possibly due to a 14% increase in new properties entering the market, although buyer demand per property for sale is still more than double pre-pandemic levels. Of course, it’s the “power- buyers” who are successful in securing the property they want. These are the buyers who have nothing to sell or are already under offer or exchanged; they have their mortgage agreed in principle and they have a good conveyancer ready to go. And if you don’t yet fall into this category because you have a property to sell – well you know who to call!