Worcester, Droitwich & Malvern Market Update – December 2021
COMMENT
The property market continues to ride the wave as we head to the end of 2021.
According to Zoopla 2021 sales volumes to date, are 16% above the 5-year average. The figure may well eclipse 2007 by the year-end with sales in the region of 1.3 million, 8% higher than the longer term average (2015/16 to 2019/2020). Although softening, demand remains stronger than a year ago.
Property prices are predicted to rise by 3.2% during 2022, and there is now no sign in the forecasts of prices falling. If 2022 is going to be your year for a move, now is a great time to be talking to our award winning team and take advantage of our seasonal Do Not Disturb campaign. This means we have the opportunity to prepare for the launch of your property on the portals in advance; perfectly timed for when the numbers of people searching on Rightmove hits its peak on Boxing Day and leave you in peace to enjoy Christmas.
Whether we hear from you before the festivities begin or not, on behalf of the entire team here at Nicol & Co, may I wish a merry Christmas and a Happy New Year.
LOCAL MARKET ROUNDUP
Over the last year, there have been 4405 sales in Worcestershire, 18% more than the previous twelve months; reflecting a significant post lockdown recovery. 641 sales in Malvern represents an increase of 24.5% and 1875 sales in Worcester, is 19% higher. In Droitwich, the year on year figure is actually 5% lower, at 483, reflecting the resilience of the local market a year ago.
Average house prices have yet again increased across the county with Malvern rising to £283.2K and Droitwich £272.4K. In Worcester, where 42.6% of the sales took place, the average sales price has held firm at £240 K.
The lettings picture has fluctuated over the last twelve months, with a 7% increase in the Worcester average to £749. Droitwich is now 9.9% higher, at £823; 7.5% above the Worcestershire average of £766, which has grown by 6%. Malvern, showing recent healthy growth, is now highest at £831
NATIONAL MARKET
At 11.8% annual price growth in the year to September, as the stamp duty holiday ended was at its second highest level (after June 2021) since November 2004 (ONS). The average price of a property across the UK is now £269,945. Despite rising inflation and likely interest rate rises, the latest forecasts from the Office for Budget Responsibility predict price growth will continue, albeit at a more sustainable level, through to 2026.
Rightmove report a 14% increase year-on-year from homeowners seeking a property valuation in October, which may well point to a rise in supply in the New Year. At present, levels of new instructions remain low with stock levels per agent remaining historically low (RICS).
Property prices are predicted to rise by 3.2% during 2022, and there is now no sign in the forecasts of prices falling.
ECONOMY
Inflation rose to 4.2% in October, its highest rate in nearly 10 years and twice the government’s 2% target. The cost of fuel, gas and electricity all increased. Weekly earnings annual growth is set to average 5.7% in 2021, the highest level in 20 years; adjusting for inflation this equates to 3.6% in real terms, after being 1.8% (nominal) and 0.8% (real) in 2020. (National Institute of Economic and Social Research).
In the Autumn budget the Chancellor described the economic picture as “strong” in the short term, with the Office for Budget Responsibility expecting the economy to return to pre-pandemic levels 6 months earlier than expected (by 2022).
LETTINGS MARKET
Rental values are rising at their strongest pace in over nearly 5 years. Average values across the UK, excluding London, rose by 2.2% in the year to October (ONS)., the strongest rise since December 2016. In Worcestershire healthy growth has been seen across the board particularly in Malvern
The RICS monthly survey revealed at +66%, the balance of respondents noting a rise in renter demand across England and Wales is at its highest level ever recorded by the survey.
As with demand, the net balance of agents in the RICS survey envisaging rental growth over the next 12 months is at its highest ever recorded level. The net balance of agents predicting a rise was higher in all regions except the North and Scotland.
COMMUNITY
The pandemic has taught us who the real heroes are in our community. Cleary it has been a difficult time for many but our key workers. teachers and volunteers have soldiered on. We so admire their commitment that we want to continue to support them and reward it by donating £100 from every sale we are instructed to make this year. So far, we have made donations totalling over £8,000. If you know of an established community organisation, 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