2022’s buoyant property market shows no signs of slowing down as buyer demand picks up momentum this lockdown-free summer. The desire to move to the South West of England remains on the agenda for many, with little sign yet that those economic headwinds are impacting the real estate barometer dial.
HMRC has released their official transaction data for May 2022, and this summer clearly entails ongoing and prevalent strength of the UK property market, with a 1.6% increase in completed sales since April’s figures earlier this year. *
This year has also seen the annual property price growth in the South West reach 14.5%. A considerably stronger figure than the 7.9% evident during the lockdown. Following on from the past two years, buyers and sellers alike are aware now more than ever of the value of space. Prices for detached homes this year have surpassed all other property types with growth of average asking prices up by 17% year-on-year. *
However, buyer demand remains steadfast. Rightmove recorded a notable 16% increase over the past few years, and that figure is expected to grow. It’s apparent in today’s climate that there’s an emerging demographic for those looking for a change of surroundings – Making the South West a hot spot due to its diversity of things to see and do. ***
East Devon and South Hams proved to be the fastest-moving markets in Devon and Cornwall over the course of 2021, with more than one in every 20 privately owned properties estimated to have changed hands. 2022 has delivered on the same momentum. This year, the average time taken to sell a property in the South West is over three weeks quicker than the previous year. **
The return-to-office and hybrid working culture have influenced a renewed interest in apartment living, and town and city center locations are seeing a rise in buyer demand. Many buyers are ready to return to the hustle and bustle of city life after 2 years of social distance.
Although balancing supply and demand remains a challenge for both buyers and sellers, new listings in January rose 11% year-on-year with Rightmove noting a substantial rise in valuation requests. This indicates to property agents that many customers are looking to sell before they buy. **
Ian Mckenzie, CEO of The Guild Property Professionals says: “2022 started in the same vein as 2021, and we are witnessing stock levels per agent at historic lows. However, home valuations are on the rise, and we anticipate a more balanced market emerging in the coming months. Despite a rate rise, interest rates remain low and mortgages are competitive.” ***
With economic growth of 7.5% over the course of 2021, the UK economy is close to returning to its pre-pandemic level. However, due to the rising cost of living, many people may be holding off on moving during a time of uncertainty. Increases in the cost of food and clothing, along with rising fuel and energy prices are all factors contributing to the squeeze on many household incomes. ***
Going forward, growth in the UK will likely be dictated by interest rates. While rates are expected to gradually increase over the years, the consensus is that there’s enough demand in the property market to sustain the current levels of activity. And while interest rates may well rise from the current 0.5%, they remain low by historic standards. **
*According to statistics from HMRC
**According to Buy association
