If you needed any more convincing that the housing market was on the up, then you only have to browse the Rightmove report for January to calm your quivering nerves.
With the election out of the way, and a lot of stability returned to the country overall, both buyers and sellers are looking to move fast in the market and that is creating a huge buoyancy. Rightmove director Miles Shipside stated that the 2.1% rise is the biggest New Year price surge that the company has ever recorded, reinforcing the notion that the market has a new-found confidence. The number of sales agreed was also up to 19 per cent compared to a year ago, as buyers who had been deterred by years of political uncertainty since the EU referendum in 2016, returned to the property market.
The new year period is always one that is looked at with anticipation by lenders and agents alike as it gives some measure of the market following what is always a lull around the Christmas break. The Christmas period is traditionally a low point in the calendar and January is the first real indication of the true state of the market. This year, the bounce has been much more pronounced than in previous years, leading market experts to consider a much more positive view about how the market is likely to perform from here onwards.
Key to this bounce is the feeling that there is a lot more stability now that both Brexit is assured and there is a stable Government with a workable majority – both things that have troubled business for the last couple of years. The instability of the previous three years has coincided with a marked reduction in properties coming onto the market, but with the New Year, this has relaxed somewhat, with 102,810 housing sales transactions recorded in January.
According to Mr Shipside, “one factor behind the upwards price pressure has been the shortage of property coming to market, with 2019 numbers down by 19% on 2018 and some would-be sellers postponing their moves until they judge the outlook to be more certain.”
This is great news for a market that has been languishing for some time, and needed some positive news to kick-start it again.
The report by Rightmove is backed up by The Royal Institute of Chartered Surveyors, who say that they believe that house prices are likely to grow by at least 2% in 2020 – over double the 0.8% growth that was recorded in 2019! The institute also believes that rent will increase on average by 2.5% over the year.
In the Rightmove report, Marc von Grundherr, a director at Benham & Reeves in London, also believes that we are seeing a positive bounce from the combination of a strong election result and movement on Brexit. He is quoted as saying that “People have been waiting for stability, and the moment it arrived, confidence in the market has increased significantly. There has been a dramatic Boris bounce, so to speak, with real optimism among buyers still getting good value. But it’s also not a bad time for sellers as stock levels are still relatively low.”
If you are looking to take out a new mortgage, or consolidate existing borrowing, why not come and chat to our experts at Grange Mortgages, and see how we can help you.