Market Comment (November 2022)
We’re approaching the final month of 2022, but surprises and unexpected issues continue to occur. It has been a challenging year for many reasons, and housing market obstacles have been a continual issue.
However, there are buyers still keen to move, and if you want to make an informed decision, rely on Trading Places to keep you informed and ensure you are up to date.
More than a million potential first-time buyers to pause their plans?
There’s nothing like an attention-grabbing heading to make people pause and think, especially when a million crops up!
A recent study that spoke with people under 45 who had never owned a property highlighted potential buyer activity in the market in 2023 and beyond.
46% of respondents said they aren’t looking to buy a house now but intend to purchase a property in the future. 16% of respondents said they have no intention of purchasing a home. Of this group, 20% cite the cost-of-living crisis and inflation as the critical factors which place home ownership out of reach for them.
In extrapolating these responses, more than one million people aged 45 or younger have paused their property ambitions. Given the market depends on a flow of first-time buyers coming to the market, there is a lot to consider about the way the housing market is moving.
Matt McGill, MD Aviva Equity Release, comments: “The cost-of-living crisis, and other factors resulting in higher inflation and interest rates, have put pressure on people juggling competing financial demands. Events of the past few months have created uncertainty; nobody can predict the outlook for the coming months with any confidence. Despite resilient housing market activity, it now appears rising mortgage rates are dissuading many from taking that important first step onto the property ladder. In years to come, this will have a knock-on effect for younger people today. Wealth held in property contributes greatly to someone’s overall assets and can be used as a valuable source of funds, particularly later in life. In the event of any property market adjustment, most people’s most valuable asset will still be their home.”
Property prices fell in November
According to the Rightmove House Price Index, the average asking price of property in November 2022 was £366,999; which represents a fall of 1.1% on the October 2022 figure, but a 7.2% increase on the November 2021 average asking price.
Given all the issues influencing the market, it is no surprise that asking prices have fallen. Some experts will suggest this is the new trend, but as always with the housing market, there is no guarantee prices will continue to move in this direction. Of course, buyers and sellers are realistic during this period, and this price movement isn’t a surprise.
Rightmove’s Tim Bannister, said; “We’re hearing from agents that both existing and new sellers understand that to sell in the current market they need to price competitively. During the market frenzy many agents said that they had to rip up the rule-book on valuing properties due to bidding wars, but now they’re back in more familiar territory, and pricing right first time is even more critical to securing a quick sale.”
November also saw a further interest rate increase, to 3%, which is the highest level since 2008.
Rightmove’s Tim Bannister also spoke about this change, and what it means to people looking to arrange a mortgage. He said; “It’s important to look beyond the headline numbers. Mortgage brokers and lenders will be able to help people assess the different options available to manage their costs and see if they can afford to move. What we’re hearing from estate agents is that people are taking a medium- to long-term view when weighing up if now is a good time to move. If they know they can afford the mortgage payments, and they’ve found a home they love, then they’re determined to try and make it work.”
No matter what move you are considering, or if you need any guidance, Trading Places is here to assist you.
Can we help you move in 2023?
If you would like to learn more about Leytonstone, what the area has to offer, and how to achieve your goals in the local property market, we can help. To arrange an appointment, call us on 020 8558 1147 or send us an email at info@tradingplacesproperty.com
You will find Trading Places Estate and Letting Agents at 46 Church Lane, Leytonstone, London, E11 1HE; and we look forward to assisting you.
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