Many prospective homeowners will be asking themselves is now a good time to buy in the East Midlands?
The current property market is a tale of two stories based on current statistics. Yes, prices have reached yet another all-time high with the average price in England reaching a staggering £293,339, 10.7% up on the same period last year. What is more surprising is that this time last year the Government had incentivised buyers by removing stamp duty (SDLT) on normal residential purchases. This seems like great news for sellers as capital appreciation is one of the big drivers in homeownership.
On the flip side transaction numbers are 55% down on the same period last year, 96,290 in June 2022 compared to 214,530 in June 2021. This does seem a massive turnaround, but we saw massive growth last year in house sales resulting from the SDLT offer from the Government looking to stimulate the market.
These statistics show that currently demand is massively outstripping supply which is the sole reason house prices are staying so strong. Many house purchases were brought forward as a result of the SDLT offer so people looking to buy currently are in a difficult dilemma,
- Are they paying too much for the property?
- Are prices going to keep rising given that inflation is pushing towards 10%?
- Is the market likely to fall given the macroeconomic issues of the day?
House price inflation and cost of living inflation are almost a match currently. One thing that needs to be taken into consideration is the rise in energy bills which will massively impact on peoples’ ability to repay a mortgage or rental payment. These energy increases are going to push inflation even higher given the eye watering estimates being talked about by the likes of Martin Lewis. It will be interesting to see if wage inflation follows suit and if so, we have not seen the top of this market yet.
This is undoubtedly a very difficult market to navigate currently, but one interesting statistic I saw recently relates to the sale of properties at auction. Statistics for 2021 were very consistent at around 78-79% of units sold at auction with a peak in May of 79.5% and the worst being August at 71.6%, albeit on very low numbers due to school holidays. June this year was an average month in respect of numbers yet came in at only 73% of lots sold, nearly 5% down on the same month last year, it is to early to call it a slowdown but perhaps buyers are becoming more and more cautious in this very challenging market.
If you are a landlord looking to sell or try a more profitable strategy, then why not contact us and discuss your options.
