Housing Market Report - 1st March 2023

Welcome to our housing market report for March 2023, as the end of Q1 fast approaches it has certainly been a surprising start to the year with many agents around the country suggesting they are quietly confident that the housing market may see its usual Spring time uplift and that 2023 may not be as bad as many feared during Q4 of 2022.  In this 2 minute read we will review some of the latest statistics and expert opinions.

The rate of house price growth continues to be slow with Nationwide reporting that UK house prices fell to by 1.1% in the year to February.  This comes after a period of slowed growth with average price growth in the year to January down 1.1% from 2.8% in December.  However, interestingly new seller asking prices rose by 0.9% in January according to Rightmove, although still down from the highs in October.  Month on month did unfortunately see prices fall too, with a drop of 0.5% meaning that prices are now 3.2% below where they were in August 2022.  This downward trend is widely expected to continue throughout 2023, with many experts expecting a downward adjustment of around 5% this year.  

The good news is that although the level of buyer activity reported by Zoopla is around 20-40% down on the pandemic peaks it is actually still significantly higher than pre-pandemic years of 2017-19, which would suggest that as long as sellers are realistic with their price expectations there will be buyers around for them. In fact Pantheon Macroeconomics has tentatively suggested prices could grow again in 2024, regaining the predicted 2023 losses of around 5%.

We need to remember these falls in average prices have come after huge increases, for example Halifax claim that prices have soared 20% since 2020! As a Welsh based business, we cannot help ourselves and need to mention that average house price growth here was the highest of all the UK regions, with average house prices soaring 29% from January 2020.  As Kim Kinnaird from Halifax mortgages points out the important thing here is even if we see a huge downward trend in prices of double the 5% that is widely predicted and they drop 10% this year, they are still going to be much higher than just a couple of years ago.  Kim explains “Taking detached houses as an example, average prices remain some 25% higher than at the start of 2020. Even if those values were to fall by 10%, they would still be around £50,000 more expensive than before the pandemic.”

It is without doubt much more of a balanced market than in recent years and we are unlikely to see buyers in a frenzy as we did in 2021.  Tim Bannister, director of property science at Rightmove, explains “Our key indicators now point to a market which is transitioning towards a more normal level of activity after the market turbulence at the end of last year. Agents are reporting that they are now increasingly seeing buyers who have more confidence and more choice – albeit with revised budgets – to accommodate higher mortgage rates.”

Jack Stones, Stones Young (Blackburn) concurs with what Tim is saying and reports that sensibly priced properties are still selling “We are finding realistically priced properties are selling. Vendors with unrealistic expectations who think they can push ceiling prices, like they have in the last couple of years have found themselves struggling. Fewer properties going over the asking price and have not been getting into bidding wars. But, with properties taking longer to sell, we find it easier to build chains and get people to come on the market if they see a property they like whereas the property would have sold too quick in the last couple of years. The rental market is strong so investors are still buying at reasonable prices.”

With Spring around the corner, will we see the usual uplift in properties coming to the market and if so, what impact is that going to have on the market? it is certainly likely to see buyers have more choice and therefore feel less of a sense of urgency.  However, a tougher market helps the best agent rise to the top, using their skill and expertise to make sure that their client's homes are well priced and well presented, allowing them to attract high levels of interest and create competition between buyers to take away their sense of control.  Using tools to work more efficiently and to help you stay in touch with more potential sellers, allowing you to focus on maximising market share is likely to be essential to make 2023 a successful year for most estate agents and those who achieve this could even find it was a year full of opportunities.  

If you would like a current market value of your property, contact the OneAgency team by calling on 01782 970222

Credit : https://my.dezrez.co.uk/portal/en/kb/articles/housing-market-report-1st-march-2023