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UK house price growth at strongest levels since 2016
According to Rightmove’s January House Price Index, the average price of property coming to market grew at its fastest annual rate for nearly six years. Increasing 7.6 per cent year-on-year to £341,019, representing a 0.3 per cent increase this month.
According to the Rightmove House Price Index, the last time this figure was exceeded was when it reached 8.3 per cent in May 2016.
The increase was fueled by growth at the top end of the market, and the first-time buyer sectors, with first-time buyer homes hitting a new record average asking price of £214,176, representing an increase of nearly seven per cent compared to the same period last year and a new record high.
The report continued that the number of homes available for sale per estate agency branch has hit another record low of 12 properties, down by two from the previous month. As a result of fewer homes on the market, along with high demand, market activity has remained strong. The average time to find a buyer in December was two weeks faster than the same period last year.
As stated by Rightmove, as a result of the strong start to 2022, more than 70 per cent of the properties currently on estate agents’ books have already been sold, leaving less than 30 per cent still available to buy. Moreover, agents reported 15 per cent more enquiries from potential buyers, suggesting competition will remain aggressive.
There are some positive signs in regards to stock levels though, as noted within the report, there are signs that more properties could be coming to market, as agents have seen a rise in home valuation requests, up 44 per cent in the first week of 2022, compared to the same period in 2021, and up 48 per cent against 2020.
It was also noted that the first working week of the year, was the busiest for home valuation requests, and the first working day of 2022, saw the fifth-highest number of valuation requests in a single day that Rightmove has ever recorded.
Tim Bannister, Rightmove’s property data director, states that the trends from 2021 have for the most part carried into the new year, however, there are “early signs of a better-balanced market in 2022”.
There are also signs of incoming supply as Tim pointed out the number of valuation requests have continued to increase following the end of 2021, although the potential supply may take a while to appear on the market, it is an encouraging sign to see more choice for potential buyers. He continues by expressing that almost 40 per cent of people enquiring about a property on the market have not yet listed their current property. Due to the high levels of demand and limited supply, these individuals may miss out on the home of choice, and suggested buyers should have their current property listed on the market or sold subject to contract first.
As a whole, it has been a very positive start to the new year, with the market growing at its fastest annual rate in the past six years. With the continual increase in demand and the low level of available stock, the housing market is expected to surge at the front end of 2022. Agents have witnessed a significant rise in enquiries for listed properties within the first week of January. The same applies to valuation enquiries, with a significant increase when compared to the previous two years.
If you would like to discuss the UK property market in more detail, please reach out to the team to organise a time to have a conversation about how Wealthi can help you build a successful property portfolio.
Chris Hynes is Wealthi’s Global Research Analyst, Based in London