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April 2022 Property Market Update

INTRODUCTION


  • London has finally woken up in both the sales and rental markets, with average house prices increasing by nearly 8% in a year and rental prices increasing by over 11% year on year. Whether it be seasonal buoyancy or post-pandemic enthusiasm, the demand for London property is very hot right now…the rest of the UK hasn’t shown any sign of slowing down either


HOUSE PRICES - UK House Price Index


The UK HPI is based on completed housing transactions. Typically, a house purchase can take 6 to 8 weeks to reach completion. Therefore, the price data feeding into this 2022 UK HPI will reflect sales agreed in April.


UK


- Average Price UK £276,755 - February 2022

- Annual Price Change 10.9% - February 2022

- Monthly Price Change 0.5% - February 2022


London


- London Average Price = £529,882,102 - February 2022

- London Annual Price Change = 8.1% - February 2022

- London Monthly Price Change = 2.2% - February - 2022


HOUSE PRICES - HALIFAX HPI


The Halifax uses its own database of approximately 300,000 mortgage approvals per annum (ca. 25% of all mortgages) as a basis for its monthly house price reports. Because it uses approved loans rather than completed mortgages, the Halifax can obtain data earlier than the Land Registry


UK


- Average Price: £282,753 - March 2022

- Annual Price Change: +10.8% - March 2022

- Monthly Price Change +0.5% - March 2022







TRANSACTIONS - UK House Price Index


The provisional seasonally adjusted estimate of UK residential transactions in March 2022 is 114,650, 35.7% lower than March 2021 and 2.6% higher than February 2022.


The provisional non-seasonally adjusted total of UK residential transactions during 2021 to 2022 is the highest financial year total since 2007 to 2008.



RENTAL INDEX MARKET (March 2022)


Data is gathered from our tenant referencing service, and our rental amounts are based on actual achieved rental prices with accurate tenancy start dates in a reported month, rather than advertised costs (HomeLet)


- Average rent in UK = £1,078

- Annual Variation for the UK = +8.7% (year on year)

- Average rent in London = £1,770

- Annual Variation for London = +11.6% (year on year)

- Household Rent To Income Ratio UK: 35% (single earner)


“As predicted in recent Rental Index commentary, demand will continue to outstrip supply, and when that is the case, rent prices will surely continue to grow. The March figures are a perfect example of this, with the average rental price for the UK rising almost an entire percentage point in the space of a single month” - Homelet


News


  • A ban on landlords charging ground rent to leaseholders will come into force on 30 June. This will apply to all new residential leases with further consultation to be had on existing leases


  • Rental prices in Central London have surged. The number of properties available for let has consistently trended down from the peak of available stock in July 2021, with about 75% fewer flats available than in March 2021, London Central Portfolio’s Q1 2022 lettings report shows.


  • Homebuyers are paying more for properties with heat pumps or other low-carbon technology installed, and are looking closely at energy ratings, according to analysis by the estate agents Savills


  • Around 114,650 residential property transactions took place last month, which was 36% less than in March 2021 - the ending of the stamp duty holiday would have greatly contributed to this

  • Over 19,000 UK homeowners regretted buying their property last year, with just under half saying that the main reason for this was that they found a number of problems with their home they weren’t aware of before moving in


  • The price of home improvement skyrocketed by 17% in January, with the average person paying an extra £379 for home improvements last month, versus prices paid in 2021, according to the latest data from Checkatrade


  • London’s £5 million-plus residential market has recorded its strongest start to the year ever, according to real estate advisor, Savills, which has kept a detailed log since 2006.




Mortgage Market News


  • Inflation in the UK climbed to 7% in March, the Office for National Statistics (ONS) says. This compares to a 6.2% rise in February, at the time the fastest rise recorded in 30 years.


  • Newcastle Intermediaries is now offering a 10-year fixed rate mortgage product. It can be used for purchase or remortgage and comes at up to 80% LTV and is set at 2.99%. It also charges a £999 fee.


  • Precise Mortgages has launched a range of residential mortgage products for customers with poor credit profiles, including those with county court judgements, defaults and active debt management plans. The lender says the maximum loan to value for customers with lower levels of recent adverse credit will lift to 85%


  • Mortgage Advice Bureau (MAB) has announced the acquisition of Fluent Money Group. MAB has agreed to buy 75% of the firm for a cash payment of £73m based on an enterprise value of £95m.


  • In March the average rate for a two-year fix lifted by 3 basis points, to 2.85%. Meanwhile, the average rates for three- and five-year fixes both rose by 2 basis points to 2.86% and 3.00%, respectively.


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