January 2017 is almost over and finally I feel like the dust has settled allowing me the opportunity to catch my breath to reflect on the past year.
2016 was certainly eventful. The ongoing saga that is Brexit, the Queen’s 90th , Andy Murray winning Wimbledon, Trump, Bake Off to Channel 4, the Autumn Statement and something close to the hearts of every buy to let landlord and homeowner in Walsall… the changes in the local property market.
So, let’s look at the headlines for the Walsall property market in 2016…
In the last month, Walsall property values rose by 0.48%, leaving them, year on year 4.34% higher, whilst interestingly, Walsall asking prices are down 0.7% month on month. All three statistics go to show the Walsall property market has recovered well after the summer lull, which was worsened by the uncertainty surrounding the EU vote back in June. Irrespective of all the issues, the average value of a Walsall home now stands at £176,085.
Generally, Walsall asking prices continue to hold up well, as asking prices are 3.9% higher year on year. Asking prices tend to drop on the run up to Christmas and locally, they have dropped by 0.7% this month. Although this still compares well with last year’s drop in Walsall asking prices, as we saw asking prices drop by 0.6% at the same time 12 months ago.
Now it’s true to say, after chatting with fellow property professionals in Walsall, all of us have seen the number of property sales fall slightly, suggesting a slowing market, but it is very early days and it could be the time of year. Also, the numbers are limited, so it’s interesting to take note from a recent survey by the Royal Institution of Chartered Surveyors, stating new buyer enquiries and new instructions are falling at the same rate, suggesting that there will not be a downward pressure on property values.
Looking at the figures for the UK – as we can’t just look at Walsall in isolation – property values are generally rising slower than a few years ago, but on a positive note, there’s still growth across the UK. Slowing property value growth isn’t solely ‘Brexit’ related, but after a number years of double digit rises in property values, affordability has weakened and cooling price growth is widely seen to be a natural correction of the market.
On the other hand, interest rates being at a record low of 0.25% are helping the property market. The cut in interest rates in the late summer was the medicine for the post-Brexit worry and will, as a consequence, ensure that the UK economy continues to be underpinned by buoyant property prices.
So, what will happen in 2017 in the Walsall property market?
Some say until we know what type of exit the UK will make from the EU it is hard to evaluate the outcome. If this is the case, we need to be very patient people! However, I believe, the whole Brexit issue is a sideshow to the main issue in the UK and Walsall housing market as a whole. As I have mentioned time and time again over the last few months, the biggest issue is demand outstripping supply when it comes to the number of households required to house us all. Walsall has an ever-growing population: with immigration (we still have at least two years of free movement from EU members into the UK), people living longer.
We also need additional households as the country has nearly 115,000 divorces a year thus one household becoming two! Interesting times ahead indeed!
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