Market Comment (April 2022)
Spring has sprung, and there is considerable activity in the property market. Demand is still far greater than the supply of homes, but deals are taking place.
At Trading Places, we are on hand to assist you with any property market move you wish to make. We are also here to ensure you make informed decisions when buying or selling property.
Halifax House Price Index indicates rising house prices
The most recent House Price Index, issued by Halifax, shows an increase of £3,860 in property prices in March, representing an increase of 1.4%. This represents the most significant increase since September 2021.
Halifax figures suggest the average price of property in the UK has risen by £28,113 in the past year. When you take on board the average annual earnings in the UK stands at £28,860 before tax is accounted for, you have a situation which is challenging for many people in the property market.
Property prices have risen by £43,577 since March 2020, when the first lockdown occurred.
Russell Galley is the Managing Director of Halifax, and he said: “The story behind such strong house price inflation remains unchanged: limited supply and strong demand, despite the prospect of increasing pressure on households’ finances. Although there is some recent evidence of more homes coming onto the market, the fundamental issue remains that too many buyers are chasing too few properties.”
London market – Annual changes small, monthly changes big
The London housing market stands apart from the rest of the country, which means our local market is subjected to extremes. The market in and around Leytonstone isn’t as volatile or dramatic as in some London locations. Still, we need to pay attention to what is happening in the capital market.
The average price of a property in London, according to Office for National Statistics (ONS), as of February 2022, was £529,882. As you’d expect, this is the highest average price for all regions in the UK.
Between February 2021 and February 2022, house prices rose by 8.1% in London. This is the smallest increase in this period of all regions.
Between January 2022 and February 2022, house prices rose by 2.2% in London. This is the most significant increase in this period of all regions.
Will interest rates continue to rise?
It was only in March that interest rates rose to 0.75%, and while this isn’t going to change in April, some industry experts believe a further increase isn’t too far away.
The Monetary Policy Committee (MPC) is scheduled to meet in early May, and there are concerns that a further interest rate increase is on the cards.
Ruth Gregory, Senior UK Economist at Capital Economics, spoke about this, saying; “With high inflation feeding into price/wage decisions, we think the Bank of England will have to raise rates further than it expects, perhaps to at least 2.00 percent next year”.
Rising interest rates affect homebuyers, homeowners and people looking to save for a deposit. So, there is a massive connection to the property market. Interest rates have been historically low for some time, but as with many other things in life, homeownership is set to become more expensive.
Much ado about nothing in Spring Statement for housing market
There was next to nothing in the Spring Statement concerning the housing market, so that won’t have affected buyers or vendors too much.
Can we help you move in 2022?
If you would like to learn more about Leytonstone, or the surrounding areas and have a property you are thinking about selling this year, we would be more than happy to help.
You will find Trading Places Estate and Letting Agents at 46 Church Lane, Leytonstone, London, E11 1HE; and we look forward to assisting you.
Click here for an online Valuation (a starting point)
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Click here to book a Home Visit Valuation (the full works)