Worcester, Droitwich & Malvern Market Update – August 2022
COMMENT
The UK dealt with historic temperatures recently, and although the scorching heat of the housing market is showing some signs of moderating, as month-on-month price rises soften, it remains sunny for those looking to buy and sell. Rightmove report that buyer demand, while down year on year, is 26% stronger than before the pandemic and the volume of new sellers in the market is up 13% compared to this time last year.
With the volume of new instructions still failing to keep track with demand, properties continue to sell in just 32 days. This is six days faster than a year ago, and over three weeks quicker than the comparable pre-pandemic average. Just over 66,000 mortgages were approved in May, on par with the longer-term pre-pandemic average indicating that market is stabilising and at £28.4 billion mortgage lending was at its strongest in 2022 to date.
All this analysis points to the same conclusion; now is a great time to sell, demand remains strong and the market is still short of stock. If you are contemplating a move, why not give us a call and let us help you with your plans.
LOCAL MARKET ROUNDUP
The latest Land Registry figures, for the year ended 30th April 2022, indicate there were 3939 sales in Worcestershire, 24.2% fewer than the previous year; reflecting the spike in activity caused by the end of the stamp duty holiday. 568 sales in Malvern represented a reduction of 28% and 1790 sales in Worcester was 17.6% lower. 374 sales in Droitwich, reflecting a significant reduction of 40.6% is well below the pre-pandemic average, which had been boosted by a significant number of new build properties coming to the local market at that time.
Average house prices increased across the county in the twelve months to 31st May 2022. Malvern rising 6.1% to £294.7K with Droitwich sitting at £277.3K and Worcester, where 45.4% of the sales took place, the average sales price stands at £237.3K.
The lettings picture has been fluctuating over the last twelve months, with an increase of 5.1% recorded in the average figure for Worcester. Droitwich, with flats representing 40% of the lettings stock, sits at £731, 6% below the Worcestershire average, while Malvern stands 2.4% above it at £798.
NATIONAL MARKET
HMRC report 95,420 sales were completed in June, the first time monthly sales volumes have dipped beneath 100,000 in 2022. Volumes are over 50% lower than in 2021, the market then fuelled by the Stamp Duty Holiday. Over 340,000 property sales were agreed in the first quarter of 2022 according to new data released by TwentyCi, indicating volumes are on track for 1.2 million transactions over the course of the year.
At £283,496 the average price of property in the UK is 12.8% higher than a year ago. In monetary terms this is equivalent to a rise of over £32,000 (UKHPI).
Properties are currently selling 20 days quicker than the long term average (Rightmove), with a significant proportion selling above initial asking price (Dataloft poll of subscribers). Needs-based buyers are the most active in the market place at the current time.
ECONOMY
Inflation, the rate at which prices rise, hit 9.4% in the year to June driven by petrol and food costs. There is speculation the Bank of England will raise interest rates by an additional 0.5% at their meeting in August.
Between March and May pay in the private sector was 7.2% higher year-on-year, for the public sector the rise was just 1.5%. However, adjusting for inflation, regular pay (excluding bonuses) fell by 2.8%. Job vacancy rates remain high.
Both domestic issues and the effects of the Ukraine war are pushing inflation higher. The high number of job vacancies means employers are needing to increase pay to maintain staff and recruit.
LETTINGS MARKET
Average rents across Great Britain rose by 3% in the year to May, their highest rate of annual growth since records began in 2012.
Rightmove have revised their rental price forecast upwards. Average rents are likely to rise 8% over 2022, up from the previous forecast of 5%. Asking rents increased by 3.5% in Q2, as demand continues to outstrip supply.
COMMUNITY
If the pandemic has taught us anything, it is the value of community and who the real heroes are. Whilst it has been a difficult time for many of us, our key workers, teachers and volunteers consistently stuck to their tasks. Like many, we really admire this commitment and want to continue to support them by donating £100 from every sale we make again this year. So far, we have donated over £25,000 to schools and local organisations through our Community Fund. If you know of an established community organisation or local charity, based in Worcestershire that you feel should be on the list, of potential beneficiaries, please write to us and tell us why. Contact: community@nicolandco.co.uk