The Bridgend housing
market over the last three months is now becoming more ‘normal’ after the last
couple of years of insane demand when the lockdowns started a race for space!
Even with the blackening
economic doom-mongers forecasting a harsh slowdown in the British property
market, the number of people buying and selling their homes is still very good
for the time of year.
Whilst many homeowners
are reducing their asking prices, it is not the 20% (some even said 30%) drop
some property commentators and newspaper journalists had predicted.
Looking at the
stats for Bridgend for the last three months since the disastrous Truss mini
budget – they make good reading.
Of the 153 Bridgend properties that have sold (stc) since late September, the average length of time it took to achieve a sale was 36 days.
Interesting when
you split it down by price, in Bridgend:
- Under £100k
– 159 days - £100k to
£200k – 22 days - £200k to
£300k – 48 days - £300k to
£400k – 18 days - £400k to
£500k – 53 days - £500k to
£1m – 466 days - £1m and
above – no properties sold in this price range
And by type:
- Bridgend
Apartment/Flat – 14 days - Bridgend
Terraced/Townhouse – 21 days - Bridgend
Semi-Detached – 35 days - Bridgend
Detached – 47 days
The latest sold
price data from the Land Registry shows that Bridgend
house prices currently remain 14.2% higher than they were 12 months
ago; the rate of growth
has dropped significantly.
Last month, Bridgend house prices only rose by 1.3%;
thus we are seeing the first sign that the property market is starting to cool.
With interest
rates at 3.5% and further increases likely in 2023, that will undoubtedly spur
ongoing cooling in Bridgend property values yet it’s doubtful we will see the Bridgend
property market go into the deep freeze that many doom-mongers were predicting.
As I said in recent articles on the Bridgend property
market, we will see a 5% to 10% reduction in Bridgend house prices over the
next 12 to 18 months.
That will only take us back
to the prices achieved in mid/late 2021 or early 2022 (depending on the
property type).
Landlords have experienced
double-digit rent growth in the last 12/18 months with a shortage of rental
properties coming onto the market. I cannot see this changing in the short
term, so I expect rents to be a further 10% higher by Christmas 2023.
Last week I stated it is not
always wise to only focus on house prices but also take reference from the
number of property transactions completed that feeds the fire of the British
property market.
For example, in March 2021, 135,670 properties sold,
yet a month later, it dropped to 87,600. A couple of months later, it rose
again in June 2021 to 165,290 homes sold (for it to drop to 64,000 in July).
Whilst this is good news for estate
agents and removals companies, it can skew the property market and put undue
pressure on the property market (pressure which could cause a housing crash if
not put under check).
Like most things, slow,
steady and consistent is the preferred option for the property market.
Throughout 2022, the number of properties selling in the UK has been a steady average
of 68,832 per month, ranging from a low of 61,800 in January 2022 to 72,200 in
July 2022.
This consistency will continue into 2023 and a return to a more ‘normal’ housing market.
One final thing I have
noticed about the Bridgend property market in the last six months is the number
of larger properties coming onto the market that last sold over 25 years ago.
Homeowners in their 20s, 30s
and early 40s tend to move every five or six years, yet when they reach their late
40s and 50s, they tend to stay put for longer. These properties only tend to
come on the market when people pass away or must be sold for nursing home fees.
These mature homeowners are downsizing
for several reasons. Their children have flown the nest and they are rattling
around in homes with accommodation they don’t need. Many are being driven to
sell their large homes in light of mounting energy bills, high inflation and
never-ending maintenance costs that larger properties demand.
The second reason is that the
recent rises in Bridgend house prices has meant the money released to downsize
has grown, meaning if these mature homeowners sell up and cash in to more
manageable properties, the amount of money released is quite impressive.
In conclusion, 2023 is going
to be a more ‘normal’ year, akin to the 2016 to 2019 years. Bridgend homeowners
need to be realistic with their pricing, yet as over eight out of ten sellers
buy another home, the one you buy will be lower.
If you are considering selling your Bridgend home in 2023 and would like a chat about your options, feel free to drop me a line or call the office on 03300 563 555.
