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  • Writer's pictureConrad Binding

Bank Of England Rate Stands Firm - October Newsletter



The Bank of England have once again held base rates at 5.25%, which will stay for at least another six weeks. This is a positive sign of recovery we shall see the outcome in the next few weeks. The market is already moving but this should put buyers at ease with signs of recovery and stock pricing staying firm.


  • The Monetary Policy Committee (MPC) voted 6-3 to keep Bank Rate at 5.25%, repeating its September decision after 14 back-to-back increases.

  • Consumer confidence rose to –21 in September 2023 from –25 in August, its highest reading since January 2022 (GfK Consumer Confidence Tracker).

 

Prices



  • The average price for a property in August was £291,044, up 0.2% year-on-year, and 0.3% on the previous month (ONS).

  • The average asking price of a newly marketed property increased by 0.5% this month to £368,231, below the historic norm in October of 1.4% (Rightmove).

  • House prices are falling in 4 out of 5 local housing markets, with house prices expected to fall 2% during 2024, however rising incomes will improve affordability (Zoopla).

 

Transactions


  • The HMRC report that 85,610 sales took place in September, 0.6% down on the previous month and significantly down on last years levels (-17.0%).

  • RICS' measure for Agreed Sales in the latest survey came in at a net balance of -37% in September, an improvement on August and July, but still negative.

  • Although there are fewer moves from mortgaged buyers, the number of cash buyers is holding steady. Over the last five years, cash buyers have accounted for 1 in 5 sales, this year they are making up 1 in 3 sales (Zoopla).

 

Demand



  • Mortgage approvals in September dropped to 43,300, 5% lower than the previous month. This is below the long-term average but a 9% improvement on the start of the year.

  • Buyer demand is now a fifth lower than this time last year and 25% below the five-year average for October (Zoopla).

  • The home buyer demand series in the latest RICS Residential Market Survey posted a net balance of -39% in September, an improvement from August but still indicates weak demand.

 

Investment/lettings



  • At 5.7% in September, annual growth in rental prices in the UK is at its strongest since records began. The Index of Private Rented Housing Prices reports on both new lets and renewals.

  • The average rent on newly agreed rental contracts rose to £1,283 in October, a 9.6% annual increase. This is the first time the annual growth rate has dipped below 10% since April (Homelet).

  • Letting agents have an average of 25 email and phone enquiries for every property on their books, triple more than 2019 levels and five times more than May this year (Rightmove).

 

Development/new build



  • Just under 245,000 new homes were built in the year to the end of Q3 2023 . This represents a 3% rise quarter on quarter, however year-on-year completions fell 4.3% (MHCLG).

  • Prime Minister Rishi Sunak has announced a u-turn on the government’s sustainability agenda. It seems that landlords will no longer have to have to achieve a minimum EPC grade to let out a property, as previously proposed.

  • Britain's build-to-rent sector has doubled in value from £35bn in 2019 to £71bn in 2023, and is expected to reach £126bn by 2028 (Knight Frank).

 

Prime markets



  • Average achieved prices in PCL fell by -3.1% in September, the largest drop since May 2021. Average values are 1% above their 2017-2019 average (Lonres).

  • Transaction levels were down by -24.3% annually, -1.4% lower than the pre-pandemic September average. The £2mn to £5mn band has taken the greatest hit, with deals down by -36.8% (Lonres).

  • 59% of sales so far this year in PCL have been cash purchases, up from 47% in the same period in 2022 (Dataloft, ONS).


 

Wales



  • £193,052 Average sales price, Wales over the past 3 full months

  • 6,542 Volume of sales, Wales over past 3 full months

  • £1,474,035,002 Value of sales, Wales over past 3 full month

 

Wales City market overview last 12 months


Wales Annual % change in average prices and transactions


Wales Transactions by price band


Wales Average prices


Wales Maximum price


Wales Change in average asking prices to October 2023



RE/MAX Estate agents will always keep up today regarding property trends. With worldwide coverage, we can access all markets with our local independent estate agents working on the ground and giving us factual information regarding the market. Get in touch today to speak to your local estate agent.



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