As we approach the end of 2022, the uncertainty of the economy and steadily rising interest rates, has created a definite cooling of the housing market. This has however coincided with the onset of winter, so a slowdown was always inevitable, especially considering the high level of homes that have changed hands in the past 2 ½ years.
Available homes within the local Doncaster market currently stands at its highest since pre pandemic levels of which over 20% are showing as ‘reduced’. The first time buyer market appears to have been hit hardest, with homes in the sub £250,000 price bracket showing the highest availability (not surprising when an average £150,000 mortgage, over 25 years, now costs over £200 more per month than in December 2021).
The average house price index in October showed an average fall in asking prices, although only marginally (- 0.4%) However, to put this in perspective, average prices have increased by £22,000 over the past 12 months, so a hardening was predictable, regardless of the economic climate. Having seen ‘booms’ in both the late 1980’s and in 2006 / 2007, I am used to seeing a post boom easing of prices, but am confident prices will be fairly stable over the next 12 months to 2 years, albeit with a lower turnover of sales.
The lettings market shows a similar picture, with rents increasing by at least 20% and demand exceeding supply. As with the sales market, demand is starting to ease, but rents are still holding their own. I would expect this to continue into 2023, although supply is likely to increase with those sellers struggling to find a buyer, becoming ‘reluctant landlords’.