Yorkshire Post - Property
Housing market is set to return to normal say experts
The start of the new year has seen demand for property soar by 49 per cent compared to the new year markets of 2018-2021, rivalling record demand seen during the stamp duty holiday, according to Zoopla.
While supply of homes for sale looks set to increase as we approach Spring, it is still limited at the moment, which is having an inflationary effect on prices.
Yorkshire specific figures compiled for Property Post by Zoopla shows that year-on-year, between January 2021 and January 2022, Richmondshire house prices topped the annual growth table with a rise of 9.6 per cent.
Craven, which includes Skipton and parts of the Yorkshire Dales, saw the second greatest gain with 9%. Bradford followed with 8.9 per cent and Kirklees was not far behind with 8.8 per cent.
Harrogate and Hull saw the lowest annual growth in Yorkshire, both with 6.8 per cent, Calderdale was second lowest with 7.2 per cent and Sheffield followed with 7.5 per cent. All the figures are high when compared with previous years.
Gráinne Gilmore, Head of Research at Zoopla says: “The effects of the pandemic on the housing market cannot be underestimated. Even after nearly two years, the pandemicled ‘search for space’ is one of the factors creating record demand for homes.
“Yorkshire is no exception to this broader trend, with the local authorities of Richmondshire and Craven having the highest house price growth at 9.6 per cent and nine per cent respectively, and both areas offering a rural setting with easy access to urban centres.”
With more space in mind, a must-have for those now working from home, three-bed houses in particular are most sought-after. The demand for three-bed houses outside London is driving this trend and is four times higher than the five year average. Flats have earned a bad reputation due to defects uncovered by the cladding and building safety scandal but as hybrid working continues to become the norm and city workers slowly return to offices, demand for apartments is on a sharp upward trajectory, reaching its highest level for five years.
Many agents are reporting that relatively modest average price increases, two per cent for flats compared to nine per cent for houses, and this has helped reignite their popularity amongst buyers. While supply of homes for sale is low, down 44 per cent on the five year average, new supply is coming to the market and one of the driving factors is securing a mortgage before interest rates rise further, though mortgage rates and bank base rates look set to remain low by historical standards.
Zoopla predicts that the housing market will return to more normal conditions this year.
Rightmove concurs and reports that the number of prospective sellers contacting estate agents to value their property jumped 27 per cent compared to last January and there are early signs of a betterbalanced market in 2022 as the number of new listings in the last two weeks of January is up by 10 per cent compared to last year.
In the rental market, tenant demand is 17 per cent higher yearon year. However, Robert Gardner, Nationwide’s Chief Economist, predicts that the housing market will slow this year.
He says: “While the outlook remains uncertain, it is likely that the housing market will slow this year. House price growth has outstripped earnings growth by a wide margin since the pandemic struck and, as a result, housing affordability has become less favourable.