Is the housing market really all doom and gloom cu

The short answer? No. While the current market compared to the post-pandemic market has seen a decrease. When you look at the current market compared to pre-pandemic levels, we are seeing an increase in demand of 8% and an increase in sales agreed by 1%. (Zoopla, 2023).

Currently the UK house price growth, year-on-year is an increase of 5.3%, which has decreased from 8.6% last year. Buyer demand and sales volumes are also lower by between 20-50%, yet still higher than the levels we saw between 2017-2019. How has this influx changed so much? Not only over lockdown and following the pandemic did we see a lot of people move due to their needs changing, job roles changing, mortgage rates being low and the halt on the market but now we are also seeing the fallout of Covid-19. Mortgage rates are increasing at substantial rates, the cost of living is rising, and the recession has meant the loss of jobs. Therefore, we are seeing homes come to the market looking for prices they would have achieved this time last year or even six months ago but due to the change in the overall cost of living, homeowners can no longer stretch themselves like they could before with their mortgage repayments. Zoopla has noted that the “average discount to asking price is £14,000 meaning sellers are having to forgo a third of their pandemic house price gains”.

Buyers now have more choice as new supply levels have risen by over 60% compared to 2022. This has however given more room for negotiation as we enter a buyer’s market rather than what has been a strong seller’s market. Currently, if you are looking for a quick sale, price advice is a must to make sure you don’t market your home at the top end and have to reduce over a few months before an offer is made. Zoopla has noted that over 40% of homes that are listed on the site currently have been reduced to target buyers who are time-sensitive.

Since 2019, price reductions were few and far between, yet it must be noted that while they are happening to nearly half of the homes on the market, this was also true before the pandemic, again showing the market returning to pre-pandemic levels. Zoopla noted “The latest data from valuation and risk business Hometrack shows that the discount to achieve a sale has increased over the last 5 months and currently stands at 4.5% - an average £14,100 discount per sale… Putting this discount into context, the average UK home grew in value by £42,000 over the pandemic, suggesting sellers are having to forgo, on average, 33% of their pandemic gains to achieve a sale.” So while yes, we can see some depreciation, homeowners will still see an increase from 2019 until now of around 67% of their post-covid gain.

According to Zoopla, the “Market is still on track for a soft landing with modest price falls of up to 5% and 1m sales in 2023”. As we move into the spring, when the housing market always sees an influx, it will be interesting to see if this positively affects it. We have started to see mortgage rates once again under that 4% mark, which has fallen from over 6% at the end of last year. Will could see homeowners downsizing or looking for homes that require a bit of TLC to reach lower monthly mortgage repayments.

So in all honesty, it is not all doom and gloom at all. It was thought that originally the housing market would react a lot worse to the increase in the cost of living and mortgage rates. While there is now a change in the requirements of needing to move, people still have a need to move, it is just their budget may be less than this time last year.

Would you like to know how much your home is worth on the current Ashford market?