Reality vs the media: How the housing market is fairing in 2023
With there being much negativity in the press lately, our aim is to find a way to shed a little light on what has been happening in the housing market. We also want to look at how any uncertainty surrounding house prices and the process of buying or selling, has been somewhat airing on the side of doom and gloom.
The cost of living is in no way a small matter- there are more and more people becoming increasingly frustrated with price rises. The mini budget also dug its claws in and affected the market and interest rates. This is not helped again, by media reports and panic inducing headlines.
Sandersons UK has always kept a very close watch on the market and openly share monthly market insight reports. Whilst the market has been shifting in ways that may feel unprecedented, there are simple explanations for these movements. Allow us to offer you, with hopeful reassurance, an insight into how the market actually stands presently.
What is the current status of house prices?
Much doom and gloom has been reported around the prices of houses, with recent reports from Lloyds Bank CEO, Charlie Nunn.
These are effective ways to reach out to so many people, if the ultimate desire was to reduce the faith in those looking to pave their way in the housing market.
Our tip at Sandersons UK is to deflect what you read, and ensure that any information you wish to seek, comes from trusted property agents, such as ourselves. The fact is, prices aren't falling, they are simply making their natural way back to normal levels.
2021 and 2022 saw a housing market that simply wasn't normal. This unprecedented time became a skewed view in people's mind when it came to the worth of their property. Not only that, it developed the assumption that it was incredibly easy to not only sell your house, but how to do it.
Figures from the Land Registry show that in January 2020, the average UK house price was £231,185. This figure rose to £294,329 by December 2022, that’s an average increase of over £63k in under three years and demonstrates what an unusual and over-heated market we have experienced in the last two years.
Up at their highest since the pandemic, are instructions. Despite the extra supply, demand is still strong with 25% of houses still selling over their asking price. Across the board, January 2023 saw an average of 98.8% of asking prices achieved compared to 97.9% in January 2020, when just 17% of houses were selling over asking price. Based on these figures, the housing market is still in really good shape compared to early 2020, which is, arguably, when we last saw good market conditions.
However, when you compare the current figures against March, April and May 2022 when properties were achieving an unprecedented 44%* of all sales going over asking price, you can perhaps understand why it feels like prices are dropping through the floor, the reality is that the market is simply re-adjusting to normal levels and is still out preforming pre pandemic times. *(Figures from Hamptons).
What is on the horizon for the housing market?
Throughout the entire south east, 2023 so far, according to Twenty EA, has seen lifting sale prices and volume of sales. With things looking up, we are feeling incredibly positive at the prospect of a strong market and a continuing stream of interest, with potential buyers and sellers contacting us every day.
As is normal in life though, the only stumbling block the market is seeing is an increase in property fall throughs, with rates currently at just under 40%, which is the highest in over 8 years, according to Twenty EA. This is due to a number of reasons including bad deals, poor sales progression, unqualified buyers without mortgages or solicitors, and sometimes just through the sheer amount of time it can take for completion. The impatience of those waiting to move can mean they change their minds.
Luckily, Sandersons UK has an effective way to eradicate this, with our Secure Sale. Choosing to opt to enter into a Secure Sale contract will see both parties tied into an agreement that sees the sale through to completion without either being able to simply change their minds and walk away for no reason. Innocent parties, if this does happen, will be entitled through our Secure Sale to a minimum £2,000 compensation payment.
We believe this offers a huge amount of reassurance, and allows the sale of a property to be taken seriously, with both parties under mutual consideration for each other.
As well as ensuring the completion of your home through our Secure Sale, we at Sandersons UK offer a highly proactive and efficient team of professionals, with a proven marketing strategy.
Sandersons won't tie sellers into a fixed contract period. Why do agents do this? This gives reassurance we are only ever acting in your best interest. Our Property Alerts will allow us to connect with you regularly, giving you the most up to date information on properties of interest to you up to a week before they go online. We can also notify you if we sell a property within a mile of where you live to give you an idea of value and interest in potentially similar properties.
Positivity ahead
The coming months look incredibly positive. Five year fixed mortgages under 4% have just been introduced, and lenders are becoming more competitive. This will mean that there are more buyers – keeping house prices nice and steady.
If you wish to talk to a member of the Sandersons UK team about the housing market, or have any questions about buying or selling a property with us, please do not hesitate to contact us.
