A growing realism in the sales market is seeing house prices starting to come down but there is little change in the rental market with a continuing inbalance in supply and demand and high rental prices remaining. Read our quick overview below and get the full detail in our Autumn Property Market Overview.
Typically, the months of July and August witness a slowdown in property transactions due to summer holidays and various outdoor activities, compounded by children being off school. Historically, this period experiences an average month-on-month fall of 0.9%. However, this year has seen a more significant decline,with a 1.9% drop, indicative of the growing realism in the market as vendors competitively price their properties.
Despite a dampening sales market, September price changes have levelled out from August and are still over 20% above pre-pandemic levels (Zoopla). In Liverpool, house prices have risen 0.8% yoy - a huge difference to last years' rise of 11%. The current house price in the area stands at £156,300.
A Bank of England base rate of 5.25% has without a doubt impacted the sales market but the environment seems to be steadying. With slightly more stock becoming available and people adjusting to the higher mortgage rate enviroment, we are starting to see a little more movement in the sales market and there has definitely been a shift towards the buyer. The mortgages are higher, buyers are being more cautious and this means sellers are having to list at more realistic prices.
This is good news if you are a landlord looking to expand the buy-to-let portfolio, especially if you are a cash buyer. Plus, you'll reap the benefits of the strong rental market, which is showing no signs of slowing. As always we recommend to make purchases more tax efficient to incorporate your purchase vehicle for BTL properties. If you are a non resident buyer, we can undertake HMRC NRL tax payments on your behalf. So for local and non resident buyers get in touch to see what stock we have available at LPS Real Estate on and off the market.
The drop in prices should also be good news for first time buyers, but the high mortgage rates will make it difficult for those without substantial deposits.
Thankfully in September the Bank of England left base rate alone. This is welcome news for mortgage rates and thus buyers. We are starting to see lending rates come down again as a result. Over the coming months we anticipate the base rates to come down which should alleviate the strain on the sales market. We expect a stronger sales market in 2024.
Get more detail in our Autumn Property Market Overview.
Demand in the rental market remains high, with renters tending to stay in their properties for longer than they previously would have. However, we are starting to see more stock coming to the market and the number of homes for rent is 20% higher than a year ago, but still remains 30% below average for this time of year.
As a result of this - and in line with inflation - rental prices remain high. In Liverpool, the average rental price has risen 8.4% over the past year and is currently £764, but in our experience, properties at this price are few and far between with the majority being higher.
City centre apartments remain most popular with tenants and this is where the majority of supply is coming from, but even here there is an inbalance. Whilst there is a huge demand for one bed apartments, the majority of supply is for two beds. With one bed availability being few and far between, people are having to re-think their rental preferences and are having to share rather than live alone.
It is also the same with houses; the most in-demand areas would be the likes of the L17, L18 and L19 postcodes but again, the stock there is limited, so people are having to look at other postcodes.
For every property we list, we are currently getting approximately 30 enquiries per day and we don't see any signs of this slowing. From every block viewing we hold, we get plenty of applications which is giving landlords more choice. The majority of properties are being rented on the first day of viewings.
If you are a landlord or know of landlords seeking help, and not currently with LPS Real Estate, please get in touch as we have lots of well vetted professional tenants ready to move in.
Get more detail in our Autumn Property Market Overview.
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