First of all, Happy New Year from all of us at Norgrove Sales & Lettings! A bigger and better new year means bigger and better ideas for our clients, new innovative services and customer focused client care means 2018 is YOUR year!
Now, before we forget 2017 completely let’s take a quick moment to reflect on the previous year and how the past year has affected the property market, as well as understanding what these changes could mean for its future. In the words of the great philosopher Confucius “you must study the past if you would define the future.”
To summarise, unless you’ve been under a rock for the past year you must have heard about some of the years biggest events, the presidential tribulations of Donald Trump, the triggering of Article 50 and the ongoing love hate relationship we have with Brexit Britain. You may think that these ongoing political conquests have no direct effect on you, but prepared to be surprised. Analysis of Google searches this past year has uncovered that property related concerns are at the forefront of all internet users minds. When typed into Google “How will Brexit affect…?” the terms ‘House Prices’ and ‘Mortgages’ outranked a number of other principal and pressing issues that were also dumped in the to-do pile of 2017. (Financial Times, 2017).
WHAT TRENDS HAVE WE SEEN THIS YEAR?
Setting aside the news trends on a global scale, we took our magnifying glass and took a closer look at the trends in the property market in England last year. Patterns in the data seem to suggest that the market was rocked briefly after the announcement of Article 50 as buyer seller sentiment suffered slightly.
Zoopla released a set of data which seemed to suggest that all was doom and gloom in the property world, backing up their statistics using terms such as ‘a slowing market’ and ‘desperation cuts.’ Their data suggested that homeowners are beginning to slash their prices in an attempt to secure a sale, with price cuts hitting high’s of 6% of the total sale value in the 12 months previous, that’s a potential cut of £25,562 of the total value. It seems that the anticipation of the annual budget, stamp duty changes and the increase of interest rates has knocked the confidence of sellers resulting in a flatlining chain of demand in England.
Traditionally however, a softening market is potentially to be expected in response to rising interest rates. The Bank of England pointed out that mortgage rates in the middle of 2017 are about as low as they have ever been. Borrowing on a 90% can be done at 2.5% fixed for 2 years, down a total of 4.1% between 2013 and 2015. More impressively down a total of 6% during the aftermath of the financial crisis that smothered the market between 2009 and 2012.
Moreover, this year the housing market has undermined many who doubted it’s stability and shown some levels of resilience. Britain’s housing market this year has defied all manner of uncertainties by producing a growth of 3.5pc so far despite reported slow downs in the capital. Let’s break this trend down, homes in England have increased in value by an average of £9,652 this year or if you want to look at it different way that’s £28 a day. Now according to Zoopla the British housing market is now worth a collective £8.3 trillion, so in the face of political adversity and ambiguity the housing market may be anchored into the centre of the economy enough to withstand any trials that approach in the coming year.
WHAT HAPPENED IN THE WEST MIDLANDS IN 2017?
House prices in general in the last year have been on the rise. Some areas of the county saw their house sale levels remain the same and relatively stable, but for the rest of the area, some areas have seen a relatively large increase in sales. The most successful areas this year had sale figures in the teens or above. For example, according to Rightmove, Edgbaston saw an increase of sales up to 24% in the last year, with other areas such as Harborne, Sutton Coldfield and Wylde Green all seeing respectable figures of around 12% growth in the previous year. Edgbaston was a very widely sought after area this year with local areas such as the cricket ground and the University of Birmingham both within this area, whilst not being situated in the centre of Birmingham.
Other areas of the West Midlands have seen acute rises in sale values, the bigger areas such as Wolverhampton and Coventry which have always been sought after as they are major cities in the West Midlands have seen an increase of 5% followed by a 4% increase in Dudley.
WILL THESE TRENDS CONTINUE INTO 2018?
Managing director for Halifax, Russell Galley sys that overall ‘We expect annual house price growth nationally of around 3%. This would typically add another £7,000 onto the value of the average home in the UK.
A 5 year forecast on the change in house prices predicts that the momentum in growing house prices is set to continue. Here in the West Midlands, we are likely to see the 3rd highest jump in house prices to a 14.8% increase in 2022, whereas rumoured independence talks once again have left Scottish house prices in trailing in last with just a 12% predicted increase by 2022.
INTRODUCING VALPAL- WANT TO KNOW HOW MUCH YOUR HOME IS WORTH?
Here at Norgrove Sales and Lettings 2018 is going to be a huge year for sales. We can’t think of a better way to introduce the year of the sales other than introducing you to VALPAL. VALPAL is a handy and easy to use online tool that you can use to get a valuation for your home in less than a minute. No more need to feel pressured by pushy estate agents or bothered by all those leaflets through your door.
WANT TO KNOW WHAT YOUR HOME IS WORTH? Visit our website for a FREE VALUATION in less than a minute!