Worcester, Droitwich & Malvern Market Update – February 2023
The census began recording mortgage status in 1991. The 2021 census marks the first time the data has shown that amongst homeowners, those that are mortgage free are now in the majority.
In the 10 years since 2011, the % of households who have become mortgage free across England and Wales has risen from 31% to 33%. In Worcestershire its even higher at 35% with Malvern actually just over 40%. Households with a mortgage have dropped from 33% to 29%. Recent historically low interest rates have enabled many homeowners to pay off their mortgages faster.
At the same time, whilst there has been a 4% increase in households who rent privately across England and Wales; this has not seen in Worcestershire where the private rented sector is much smaller at 13.9%. This potentially points to opportunities for developers and investors considering Build to Rent schemes. Such projects are likely to benefit from this national trend and enjoy strong local demand. With specialist teams in Land and New Homes, Lettings and Property Management we’re well placed to provide advice and guidance in this area if this of interest to you. The contact details are shown below and you will find more on our website www.nicolandco.co.uk
LOCAL MARKET ROUNDUP
The latest available Land Registry statistics, for the year ended 30th October 2022, reveal there were 40% fewer sales in Worcestershire, than the previous twelve months, when the numbers had been boosted by stamp duty incentives. The actual number of transactions was 3795. 1668 sales in Worcester was also 40% fewer, with Malvern and Droitwich both down by 35% with 611 and 437 respectively.
Over the last twelve months, transaction values varied across the county but all have shown growth. Malvern’s average transaction remains highest at £303K up 9% with Droitwich next at £284.5K up 4% and Worcester, where 44% of the sales had been recorded, the average sales price increased by 7% to £247.5K.
The increases in average sales price over the last 5 years are shown below:
The local lettings figures have been fluctuating over the last twelve months, with an increase of 8% recorded in the average figure for properties let in Worcester. Despite recent growth in the average rent for properties let in Droitwich, £734 is still 9% below the overall Worcestershire average of £806. In Malvern, the average rent for properties let over the last twelve months sits at £886, representing an increase of 13%.
Source: Dataloft Market Rental Analysis (rental data is limited and based on achieved rents for approximately 10-15% market share, depending on location).
All the national indices report annual property price growth is softening, with price readjustments expected over the course of 2023. In the 2 years since the re-opening of the market in June 2020, average prices rose by 23% (ONS).
The asking price of a newly marketed property fell by 2.1% month-on-month as Rightmove report sellers are adjusting their expectations to adapt to a less frenetic market.
The average price of a property in the UK is currently £296,422 according to the latest UK HPI.
Over 107,000 sales took place in November, the busiest November, except for 2021, since 2007. Sales volumes September-November were up 3.3% on the previous 3-month period according to data f
Annual property price growth has considerably softened according to the latest indices released by the Halifax and Nationwide. Prices remain substantially higher than two years ago, however, all indices now report small month-on-month falls.
The asking price of a newly marketed property rose by 0.9% in January, with Rightmove recording a bigger than usual New Year bounce in demand. The number of prospective buyers at the start of 2023 is up 4% on 2019 and up 55% compared with the two weeks before Christmas. However, enquiries are down a third on a year ago according to Rightmove.
The average prices price of a property in the UK is currently £294,910 according to the latest UK HPI. The average price paid by a first time buyer, if they can afford it, is £245,522, and for a former owner occupier the figure is £345,576.
Prices rises in the UK slowed for the second month in succession. Inflation fell to 10.5% in the year to December, from 10.7% in November. The drop was mainly due to easing fuel prices, food prices remain at a 40-year high.
The UK economy unexpectedly grew by 0.1% in November, as the World Cup helped boost growth in tech and service sector industries. However, more broadly GDP fell by 0.3% in the three months to November (ONS). The IMF warn one third of the global economy will face recession in 2023. The UK economy is forecast to shrink by 1.4% but is expected to grow from mid-2024-2027 (OBR).
The number of households living in the private rented sector has grown by 1.1m in ten years across England and Wales. At 20% of households, this is up from 17% in 2011.
All regions have recorded growth in the PRS since the last census in 2011. The regional increases have ranged from 2.6% to 4.9%
In the year to December monthly rental prices in the UK rose by 4.2%, up from 4.0% in November. The ONS Index of Private Housing Rental Prices includes pre-existing and new lets. At £1,074 the average rent in the UK in December was 0.1% lower than in November, the first fall in rental prices in over a year.
In response to the regular feedback we receive regarding the value of our Market Updates we have decided to publish more regular market insights online. We are emerging from an unprecedented period of activity at the same time as having to cope with equally unusual economic pressures; added to which there is a measure of political uncertaintly fuelled by the mainstream media.
In the midst of this turbulance we believe it is important for you to hear clear, evidence based messages to help you navigate in the current market and make the right choices.
With nearly two decades of experience our MD, Matt Nicol is keen to ensure you have access to expert advice and invites you to ask him directly via our website or by following us on our social media channels.
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: email@example.com