Latest: May property market report
UK house prices continued to rise in April 2022 but the pace of appreciation has slowed, reports the Nationwide. In the last month, prices increased by 0.3% and although this is the ninth successive month of growth, it is the smallest monthly rise since September 2021.
As a result, annual house price growth in April was 12.1% – down from 14.3% in March. The rate at which house prices may climb in the future – or whether they stagnate or drop – now depends on numerous factors. In the current climate, this includes what happens to the interest rate after May’s increase to 1%, the labour market, the cost of living and the number of properties available for sale.
Knock-on effects for buyers & tenants
House price rises are not only influencing how much people pay for a property but also how expensive their tax bill is. New figures from Zoopla estimate that 4.3 million homes are now in a higher stamp duty bracket when compared to the start of the pandemic. In lettings, a lack of available rental properties and rising rental values are two reasons why Propertymark says tenants are staying in their current homes for longer.
2022’s home moving priorities revealed
New analysis of Rightmove data for the BBC revealed what buyers and renters are searching for this year. A common theme continues to be outdoor space, with a garden still in the top five search terms used by tenants and purchasers.
After this, the two home moving groups reveal different priorities. Buyers are commonly using the search terms ‘annexe’, ‘acre’ and ‘garage’, while tenants are motivated to search for ‘pets’ and ‘furnished’.
The analysis also revealed a shift in the type of property today’s buyers are searching for and where it should be located. After months of ‘the race for space’ dominating moving patterns, with houses in rural locations finding favour, analysts are noticing that city living is back on the radar.
Rightmove’s data indicated that searches for flats overtook those for terraced houses since the start of 2022 – a reversal of the trend witnessed last year. In terms of locations, urban and commuter areas are gaining in popularity.
The comeback of the city is partly because of the return to the office but also due to a chronic shortage of available – and affordable – properties in countryside locations. Demand is also being fuelled by urban leisure and social amenities reopening for business.
On the up: rents and void periods
After a month-on-month rental value rise of 4%, recorded between February and March 2022, Goodlord’s latest Rental Index showed the pace at which rents are rising has slowed. During April, the cost to rent a property in England saw a small 0.5% increase, taking the average monthly rent to £1,012.
Rents are not the only thing going up in lettings. While void periods reduced to 16 days in March 2022, Goodlord found they had crept up in every region during April. In the last month, the number of days a let stayed empty between tenants rose to 19.
Ground rent news: financial savings from July
The Government has announced a ban on ground rent on newly-built, long lease properties, starting from 30th June 2022. Typically buyers of new build flats – and more recently some brand new houses – have had to pay an annual ground rent charge to the freeholder.
This charge will be prohibited for new buyers, saving the property owner an average of £319 in yearly fees. It is thought ground rent for existing leaseholders will be tackled using future Government measures.
If you would like to know more about your local property market, please get in touch.
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