Estate agents warn of major slowdown in rural market
RURAL homeowners are racing to lock in deals and accept offers for house purchases as experts predict a major slowdown by the end of the year.
The number of sellers outside London who accepted an offer last month was higher than in any April since 2003, according to Knight Frank, an estate agent. There were more accepted offers than in the same month in 2021, when the stamp duty holiday and a rush to rural living saw demand reach previously unprecedented levels.
However, experts said the last month represented the market’s peak and stagnant sales and property values were on the cards. It came as estate agents said the number of sales would rise for the next three months before slowing later in 2022, according to a survey by the Royal Institution of Chartered Surveyors (RICS).
Russell Grieve, of Knight Frank’s Haslemere office, said: “Having taken stock during the first three months of the year, people are coming to market and being decisive.”
Ross Boyd, of Dashly, a mortgage comparison website, added: “The crazy numbers we saw in April may well have been the market’s last fandango. With inflation tipped to hit 10pc and interest rates rising, this cannot continue.”
Prices for prime rural property surged 11.3pc year-on-year in March, pushing values 1pc above their pre-financial crisis peak. However, Knight Frank said this growth rate would decline to single digits by the end of 2022.
Experts said the dwindling ability of buyers to borrow, because of more expensive credit, and an expected surge in the number of properties for sale would mean offers being accepted now represented the best value.
Charles Probert, of the agent’s Hereford and Worcester office, added: “This is the time to sell and it’s a good time to accept an offer, as more property will continue to come to the market over the next few months.”
The Bank of England increased the base rate to a 13-year high of 1pc last week, with further rises in the pipeline. The average cost of a two-year fixedrate mortgage will hit 2.8pc this year, up from 2.35pc in April, according to Pantheon Macroeconomics.