At Bricks&Logic, we don’t have a crystal ball but we do have the next best thing: data. So in this article, we will share our insights into the movements in house prices over the last few years, as well as more recent changes.
The last two years have been far from normal. The Covid pandemic substantially disrupted the property market, for example, causing sales completions to take many months longer than usual.
Whilst the issues caused by Covid have begun to ease and the overall picture improve, we now face unprecedented economic challenges. Mortgage rates have escalated, the cost of living is squeezing our excess income and many people are feeling nervous.
But will it improve? - Let’s dive into the data.
We’ll look at a selection of regional house prices in England and Wales and see whether we can draw some conclusions about the immediate future direction of the housing market.
At Bricks&Logic, we don’t have a crystal ball but we do have the next best thing: data. So in this article, we will share our insights into the movements in house prices over the last few years, as well as more recent changes.
The last two years have been far from normal. The Covid pandemic substantially disrupted the property market, for example, causing sales completions to take many months longer than usual.
Whilst the issues caused by Covid have begun to ease and the overall picture improve, we now face unprecedented economic challenges. Mortgage rates have escalated, the cost of living is squeezing our excess income and many people are feeling nervous.
But will it improve? - Let’s dive into the data.
We’ll look at a selection of regional house prices in England and Wales and see whether we can draw some conclusions about the immediate future direction of the housing market.
Overall, the trend of escalating prices that we have seen over the last three years is starting to slow. Month on month, the data indicates we may be reaching a plateau. Analysts across the industry agree this is likely to shift towards house prices dropping over the next twelve months.
Of course, every region has a unique house price index, so let’s look at what’s happening in a sample of areas.
Overall, the trend of escalating prices that we have seen over the last three years is starting to slow. Month on month, the data indicates we may be reaching a plateau. Analysts across the industry agree this is likely to shift towards house prices dropping over the next twelve months.
Of course, every region has a unique house price index, so let’s look at what’s happening in a sample of areas.
London is a sprawling and highly diverse city, and we see house price fluctuations to match. Across Greater London in the past twelve months, we have seen average sales prices ranging from £260k to £4m. However, it is the volume of sales which is most interesting. Unsurprisingly, given the rising cost of living and uncertainty in the economy, the number of houses sold is on a clear downward trend.
House prices in Greater London have increased at a lower rate when compared to the rest of the UK, perhaps as a result of changing priorities and lifestyle choices due to the pandemic.
See Fig. 01.
London is a sprawling and highly diverse city, and we see house price fluctuations to match. Across Greater London in the past twelve months, we have seen average sales prices ranging from £260k to £4m. However, it is the volume of sales which is most interesting. Unsurprisingly, given the rising cost of living and uncertainty in the economy, the number of houses sold is on a clear downward trend.
House prices in Greater London have increased at a lower rate when compared to the rest of the UK, perhaps as a result of changing priorities and lifestyle choices due to the pandemic.
See Fig. 01.
Average house prices in Yorkshire range from £140k to £420k, with the area west of York, including Ripon and Harrogate, having the highest prices.
The southern part of this region, to the north-east of Sheffield, has the lowest.
Our data demonstrates a levelling off in house sale prices in this region. The volume of houses sold has not shifted as obviously as in London but the trend is the same; fewer houses are changing hands.
See Fig. 02.
Average house prices in Yorkshire range from £140k to £420k, with the area west of York, including Ripon and Harrogate, having the highest prices.
The southern part of this region, to the north-east of Sheffield, has the lowest.
Our data demonstrates a levelling off in house sale prices in this region. The volume of houses sold has not shifted as obviously as in London but the trend is the same; fewer houses are changing hands.
See Fig. 02.
If you’re considering buying a property in Wales, the data suggests that house price completion figures are similar to those in the Yorkshire region. Cardiff house prices are at the top of the range, averaging £420k, as are properties close to the English border.
The rural inland area between Cardiff and Swansea has the lowest property prices in Wales, but across the rest of the country, there is an even spread.
Prices in Wales have increased by 11% on average over the last 12 months, which is a bigger change than we have seen in England. But, as with other regions, we see a plateauing effect which could suggest we are on the verge of a change in direction in house prices.
See Fig. 03.
If you’re considering buying a property in Wales, the data suggests that house price completion figures are similar to those in the Yorkshire region. Cardiff house prices are at the top of the range, averaging £420k, as are properties close to the English border.
The rural inland area between Cardiff and Swansea has the lowest property prices in Wales, but across the rest of the country, there is an even spread.
Prices in Wales have increased by 11% on average over the last 12 months, which is a bigger change than we have seen in England. But, as with other regions, we see a plateauing effect which could suggest we are on the verge of a change in direction in house prices.
See Fig. 03.
Since September 2021, the number of houses sold in the South East of England has decreased dramatically. In March 2022, more than 20,000 homes were sold. In July this year, that figure was closer to 10,000. Our most recent data suggests a further fall in property completions is likely.
Overall, average house prices in the South East range from £200k to £2m, but the latter is an exception. When compared to the average of £356,000 for England as a whole, the average house price for the South East is significantly higher at £496k.
See Fig. 04.
Since September 2021, the number of houses sold in the South East of England has decreased dramatically. In March 2022, more than 20,000 homes were sold. In July this year, that figure was closer to 10,000. Our most recent data suggests a further fall in property completions is likely.
Overall, average house prices in the South East range from £200k to £2m, but the latter is an exception. When compared to the average of £356,000 for England as a whole, the average house price for the South East is significantly higher at £496k.
See Fig. 04.
The South West of England has seen an influx of buyers in recent years. However, a return to office working, and the associated commutes, appear to have served as a reality check for those hoping to have struck the perfect work/life balance. According to our data, the South West is already showing signs of decreasing house prices. We can also see the number of sales completions falling at pace.
There is a broad range of pricing across this largely rural area, varying from £200k to £590k.
The South West of England may well be the canary in the coal mine, giving us an indication of what is to come in the UK housing market more broadly.
See Fig. 05.
The South West of England has seen an influx of buyers in recent years. However, a return to office working, and the associated commutes, appear to have served as a reality check for those hoping to have struck the perfect work/life balance. According to our data, the South West is already showing signs of decreasing house prices. We can also see the number of sales completions falling at pace.
There is a broad range of pricing across this largely rural area, varying from £200k to £590k.
The South West of England may well be the canary in the coal mine, giving us an indication of what is to come in the UK housing market more broadly.
See Fig. 05.
Whilst it isn’t possible to give a definitive answer, when we look at the challenges in the economy, mortgage rates and affordability, it is inevitable that the housing market will be affected.
Our data supports the views of many property experts; that there is a squeeze coming and it is likely to play out in 2023. Currently, there are estimates of a reduction in house prices of 8% - 12% by the end of 2023.
We are in a globally volatile economic situation. There are many things beyond our control, so it is wise to take steps to secure our personal financial stability. Keeping an eye on the housing market is just one way we can do this. With good data and a realistic approach, you can stay abreast of your property buying goals.
Whilst it isn’t possible to give a definitive answer, when we look at the challenges in the economy, mortgage rates and affordability, it is inevitable that the housing market will be affected.
Our data supports the views of many property experts; that there is a squeeze coming and it is likely to play out in 2023. Currently, there are estimates of a reduction in house prices of 8% - 12% by the end of 2023.
We are in a globally volatile economic situation. There are many things beyond our control, so it is wise to take steps to secure our personal financial stability. Keeping an eye on the housing market is just one way we can do this. With good data and a realistic approach, you can stay abreast of your property buying goals.
In our previous blog; Is Now A Good Time To Buy Property In The UK? We looked at the various factors influencing the directions and rate of change of property prices.
When it comes to deciding when to buy a property, one of the key factors to take into consideration is the trajectory of the housing market.
Whichever side of the transaction you sit on, Bricks&Logic will help you to understand changes and trends in house prices across the UK. We will continue to watch the numbers and share our opinions based on the best available data.
We know that deciding to buy or sell a property is one of the biggest decisions we will make in life and it is a decision that is never taken lightly. That’s why, whether you’re thinking of buying or selling a property, we aim to be your number one source of reliable, accurate and up-to-date information.
Come visit here us at Bricks&Logic.
In our previous blog; Is Now A Good Time To Buy Property In The UK? We looked at the various factors influencing the directions and rate of change of property prices.
When it comes to deciding when to buy a property, one of the key factors to take into consideration is the trajectory of the housing market.
Whichever side of the transaction you sit on, Bricks&Logic will help you to understand changes and trends in house prices across the UK. We will continue to watch the numbers and share our opinions based on the best available data.
We know that deciding to buy or sell a property is one of the biggest decisions we will make in life and it is a decision that is never taken lightly. That’s why, whether you’re thinking of buying or selling a property, we aim to be your number one source of reliable, accurate and up-to-date information.
Come visit here us at Bricks&Logic.
