Worcester, Droitwich & Malvern Market Update – May 2021
COMMENT
The PwC consumer confidence index is at its highest level since the index started in 2008. The first quarter of 2021 marks the first time the index has been in positive territory since before the pandemic. The Dataloft Demand Index, monitoring hits on agents’ local housing insight page, also suggests housing market demand is up 147% on last year.
According to UKPHI at 8.6% property price growth, in the year to February 2021 is at its strongest since October 2014. The RICS March survey reflects the same market sentiment, with indicators on sales enquiries, agreed sales and new instructions all improving noticeably.
Locally, during the first quarter of this year we have experienced record levels of activity and an increasing number of sales being agreed before properties have actually reached the portals. In periods of such high demand the importance of potential buyers being registered with us should not be underestimated, given the pace at which we are currently seeing sales agreed.
Now is a very good time to come to the market with us, if you are contemplating a move, so why not give us a call and arrange a free valuation?
LOCAL MARKET ROUNDUP
Over the last twelve months, there have been 3411 sales in Worcestershire, reflecting the impact of COVID-19, 34% less than the previous year. 33% fewer transactions in Droitwich resulted in 434 sales and 490 sales in Malvern represents a slightly lower reduction in activity of 30% year on year.
Average house prices have increased across the county with Malvern rising to £266.5K and Droitwich to £262.7k. In Worcester, where 41.3% of the sales took place, the average sales price is 12.8% lower at £229.2K.
The Lettings picture has been changing over the last twelve months with a 10% increase in the Worcester average to £662. Malvern is still 10% higher at £726, just above the overall Worcestershire average of £716, which has also risen by 10%; Droitwich Spa which continues to show healthy growth remains highest at £917.
NATIONAL MARKET
An estimated 190,980 sales (seasonally adjusted) were recorded in March 2021, the highest monthly total ever recorded. Sales in Q1 2021 were up 31% compared to the final three months of 2020 (HMRC).
According to Rightmove nearly one in four (23%) properties that had a sale agreed in March had been on the market for less than a week, with properties selling faster in the first two weeks of April then ever previously recorded, 45 days from marketing to SSTC.
Sales across the UK are on average 30% higher in the first three months of 2021 compared to a year ago according to a new report by TwentyCi.
ECONOMY
UK inflation rose to 0.7% in the year to March, up from 0.4% in February thanks to the increased cost of transport, fuel and clothes.
Economists predict Inflation may well exceed the government’s 2% target by the end of 2021, the Bank of England forecast 1.9%.
The UK economy is predicted to grow by 4% over 2021 and 7.3% over 2022, set to recover to pre-pandemic levels by mid-2022. The latest forecast by the Office for Budget responsibility now expects a faster and more sustained economic recovery than forecast in November
The unemployment rate dipped to 4.9% in the three months to February, down from 5% previously. The OBR now anticipate unemployment will peak at 6.5%, down from 11.9% in earlier forecasts.
LETTINGS MARKET
According to data from TwentyCi, the number of lets agreed in Q1 2021 is lower year-on-year in all regions of the UK except London, while new instructions have fallen by close to 9%. The RICS March survey indicates that tenant demand is slowly increasing as the latest net balance rose to +36%, up from +26%.
For the coming twelve months, respondents are now projecting rental growth to come in a little under 3% at the national level. London is the only region where rents are not expected to rise over the year to come, with projections sitting in flat to marginally negative territory across the capital (RICS).
COVID SECURE VIEWINGS
Nicol & Co has operated safely and effectively throughout the periods of lockdown and will continue to act carefully as restrictions are relaxed, following the latest government guidance. We have Covid-19 secure procedures and policies in place to ensure we operate safely by reducing social contact and the risk of spreading the virus.
If you have any questions, please contact us.
COMMUNITY
The last twelve months have taught us who the real heroes are in our community. It has been a difficult time for many us but our key workers, teachers and volunteers have just soldiered on. We so admire their commitment that we want to reward it by donating £100 from every sale we make this year. If you know of an established community organisation, in Worcestershire, that should be on the list of potential beneficiaries please write to us at [email protected] and tell us why.