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NATIONAL HOUSING MARKET OUTLOOK JULY 2018


LATEST PRICE MOVEMENTS OF THE PREMIUM AND SUPER-PREMIUM REGIONAL MARKETS

NORTH EAST £325,000 ANNUAL CHANGE

TOP 5%

ANNUAL CHANGE

ANNUAL CHANGE

£700,000

average price

5%

ANNUAL CHANGE

ANNUAL CHANGE

£685,000

£425,000

average price

27%

9%

TOP 1%

£387,500

average price

ANNUAL CHANGE

3%

£625,000

average price

ANNUAL CHANGE

3%

average price

0%

EAST MIDLANDS

WALES TOP 5%

ANNUAL CHANGE

2%

average price

TOP 5%

£400,000

TOP 1% SOUTH WEST

£535,000

average price

YORKSHIRE AND THE HUMBER

NORTH WEST TOP 1% SOUTH WEST

TOP 1%

TOP 5%

TOP 1%

TOP 5%

£400,000

average price

ANNUAL CHANGE

21%

£610,000

average price

ANNUAL CHANGE

1%

average price

2%

WEST MIDLANDS TOP 1% SOUTH WEST

TOP 5%

ANNUAL CHANGE

ANNUAL CHANGE

£702,500

average price

5%

£445,000

average price

4%

SOUTH WEST TOP 1% SOUTH WEST

TOP 5%

£935,000

average price

£590,000

ANNUAL CHANGE

7%

ANNUAL CHANGE

average price

7%

EAST OF ENGLAND TOP 1%

TOP 5%

£679,950 ANNUAL CHANGE

SOUTH EAST

ANNUAL CHANGE

7%

13%

TOP 5%

TOP 1%

£1,370,000 ANNUAL CHANGE

£1,230,000 average price

average price

average price

6%

£814,000 ANNUAL CHANGE

average price

4%

LONDON TOP 1%

TOP 5%

£1,417,000 ANNUAL CHANGE

average price

6%

£3,450,000 ANNUAL CHANGE

average price

8%

These premium price points are found by listing all residential transactions within a region and ordering them from lowest to highest price. We look at transactions that happened in the most recent month for which HM Land Registry has a complete dataset. The ‘top 5%’ figure is the price of the sold property that sits exactly 95% of the way up from bottom to top, otherwise known as the 95th percentile. The ‘top 1%’ sits 99% of the way up the distribution and is the 99th percentile. We aim to avoid big month-to-month variability by using a big sample size (i.e. an entire region), but some volatility is inevitable, owing to the fact that we are only looking at a small subset of the whole market. N.B Average price March 2018. Annual change March 2018 vs March 2017

Source: ResiAnalytics


GOOD NEWS AHEAD AS UK PRIME MARKETS REACH A TURNING POINT With all the doom and gloom currently gracing the proper ty pages of the newspapers, you would be forgiven for thinking the best thing to do is lock your doors, shut the curtains and wait until it all blows over. However, as the numbers are increasingly showing, the green shoots of recovery are star ting to emerge across the UK. On first reading, the April edition of the RICS residential market survey, just says what we already know: market activity has been muted so far this year. However, and far more impor tantly, it reveals how things are star ting to improve. While there are still many surveyors reporting a fall in the number of buyer enquiries, the number repor ting a rise has significantly increased, with expectations for fur ther growth in the coming months. In London, this is the first time in 12 months a rising number of buyer enquiries has been repor ted. Anecdotally, we are hearing more and more stories from across our network which suggests the thawing of the prime property market is well underway. At this stage of the market cycle, it is inevitable that buyers will increasingly perceive the market to have ‘bottomed out’. When this happens, they will rapidly pile back into the market in order to capture as much capital inflation as possible from that next cycle. Savvy and well-advised homeowners who ‘time their run’ in the prime market will always be the biggest winners. Currently, the Government’s main housing priority is making housing more accessible – a sure-fire vote-winner. It appears to be working; the rising number of first-time buyers is the most interesting par t of the mor tgage market data we look at. This is relevant to the prime market because heightened activity at the lower end will filter upwards. After all, each sub-market of UK residential is inextricably inter twined, from the first-time buyer market at the bottom of the proper ty ladder to the premium market at the top. We are very confident that the ice is star ting to melt in the prime proper ty market. However, we must all bear in mind that the meteoric rise in prime prices experienced by many par ts of the country after the credit crunch will probably not be seen again. These gains came on the back of global financial turmoil which caused high-net-wor th individuals around the world to move their money into the safe haven of central London residential assets. We are going to see a very positive upswing, but it will be in the context of the ‘new normal’. While there is still some volatility in the prime UK proper ty market, it is clear there are myriad oppor tunities to be taken advantage of right now, and the best way to maximise the potential of these oppor tunities is by working with a local market expert.

Source: ResiAnalytics


NUMBER OF HOUSES SOLD FOR OVER £1M

A

In the latest month for which we have data, London, the South East and the East of England accounted for 90.8% of all sales above £1m.

B C

£1–1.5m

D E

J

F

G I

H

£1.5–2m

£2m +

A

1 sales

1 sale

0 sales

B

17 sales

4 sales

3 sales

C

3 sales

1 sales

0 sales

D

7 sales

0 sales

0 sales

E

8 sales

0 sales

1 sales

F

13 sales

1 sales

3 sales

G

326 sales 107 sales 159 sales

H

229 sales

55 sales

38 sales

I

33 sales

11 sales

1 sales

J

1 sales

2 sales

0 sales

SALES BY PRICE BAND (March 2018)

UK KEY PRICE POINTS March 2018

ALL

HOUSES

FLATS

Mid Market £285,000 Top 5% £675,000 Top 1% £1,300,000

Mid Market £287,000 Top 5% £680,000 Top 1% £1,270,000

Mid Market £278,000 Top 5% £655,000 Top 1% £1,625,000

SEMI

DETACH

TERRACE

Mid Market £231,000 Top 5% £550,000 Top 1% £1,150,000

Mid Market £248,000 Top 5% £545,000 Top 1% £900,000

Mid Market £415,000 Top 5% £905,000 Top 1% £1,670,000 Source: ResiAnalytics


16 20 M0 1 4 20 6M 16 05 20 M 16 06 20 M0 16 7 20 M0 1 8 20 6M 1 09 20 6M1 1 0 20 6M 16 11 20 M1 17 2 20 M0 1 1 20 7M 17 02 20 M0 1 3 20 7M 1 04 20 7M0 1 5 20 7M 17 06 20 M0 17 7 20 M0 17 8 20 M0 1 9 20 7M1 1 0 20 7M1 17 1 20 M1 1 2 20 8M0 1 1 20 8M 18 02 M 03

20

Index value of top 1% price movements by region

16 20 M04 16 20 M0 16 5 20 M0 16 6 20 M07 16 20 M0 16 8 20 M0 16 9 20 M10 16 20 M11 16 20 M1 17 2 20 M0 1 1 20 7M0 17 2 20 M0 17 3 20 M0 17 4 20 M0 17 5 20 M0 17 6 20 M0 17 7 20 M08 17 20 M0 17 9 20 M10 17 20 M1 17 1 20 M12 18 20 M0 18 1 20 M0 18 2 M 03

20

Index value of top 5% price movements by region

TOP 5%

BY REGIONAL GROUPINGS

LONDON

9%

LONDON

20%

Since March 2017

SOUTH & EAST

Since March 2017

5%

Since March 2017

TOP 1%

BY REGIONAL GROUPINGS

11%

SOUTH & EAST

Since March 2017

PRICE MOVEMENTS FOR PREMIUM PROPERTIES (TOP 5%)

120

115

110

105

100

90

MIDLANDS & WALES

7%

Since March 2017

15%

MIDLANDS & WALES

Since March 2017

NORTH

1% Since March 2017

PRICE MOVEMENTS FOR PREMIUM PROPERTIES (TOP 1%)

100

90

80

70

60

5%

NORTH

Since March 2017

Source: ResiAnalytics


HOW HAVE UK PREMIUM PRICES CHANGED BETWEEN MARCH 2017 AND MARCH 2018 FOR INTERNATIONAL BUYERS?

£1,165,000 Mar 2017 £1,150,000 Mar 2018

$ 1,434,400 Mar 2017 $ 1,581,200 Mar 2018

¥ 9,869,100 Mar 2017 ¥ 10,041,100 Mar 2018

1% change

10% change

€ 1,287,800 Mar 2017 € 1,245,400 Mar 2018

SAR 5,378,800 Mar 2017 SAR 5,929,400 Mar 2018

2% change

10% change

INR 95,863,600 Mar 2017 INR 103,053,700 Mar 2018

5% change

HK$ 11,135,700 Mar 2017 HK$ 12,376,000 Mar 2018

8% change

AED 5,267,700 Mar 2017 AED 5,806,900 Mar 2018

11% change

10% change

Annual price change of the market’s top 1%, accounting for changes in both exchange rates and domestic prices

MYR 6,379,900 Mar 2017 MYR 6,211,700 Mar 2018 3% change

S$ 2,021,100 Mar 2017 S$ 2,098,100 Mar 2018 4% change

WHAT’S HAPPENING TO PRICES IN THE MID-MARKET Here we show how prices have changed over the last few years in the mid-market. It shows the mean average price over time in England and Wales split by the main four house types. The best performing house type has been detached for which prices have increased by 15.7% between April 2016 and March 2018. £450,000

Mid market price movements

£400,000

DETACHED

£350,000 FLAT

£300,000 £250,000

TERRACE

20

16 20 M0 16 4 20 M0 16 5 20 M0 16 6 20 M0 16 7 20 M0 16 8 20 M0 16 9 20 M1 16 0 20 M1 16 1 20 M1 17 2 20 M0 17 1 20 M0 17 2 20 M0 17 3 20 M0 17 4 20 M0 17 5 20 M0 17 6 20 M0 17 7 20 M0 17 8 20 M09 17 20 M10 17 M 20 11 17 20 M1 18 2 20 M01 18 20 M02 18 M 03

£200,000

SEMI-DETACHED

Source: ResiAnalytics


NUMBER OF PROPERTIES SOLD ACROSS THE WHOLE MARKET

Monthly sales by type over the last 2 years

Here we show how sales volumes have fluctuated over the last few years across the whole market. It shows the number of sales over time in England and Wales split by the main four house types. Comparing February 2018 and March 2018, we can see transaction levels in the latter period were 2.6% lower than the former, although data from the Land Registry may still be trickling in.

100,000

DETACHED

750,000

SEMI-DETACHED

50,000 TERRACE

25,000 0 20

16 20 M0 16 4 20 M0 16 5 20 M0 16 6 20 M0 16 7 20 M0 16 8 20 M0 16 9 20 M1 16 0 20 M1 16 1 20 M1 17 2 20 M0 17 1 20 M0 17 2 20 M0 17 3 20 M0 17 4 20 M0 17 5 20 M0 17 6 20 M0 17 7 20 M08 17 20 M09 17 20 M1 17 0 20 M11 17 20 M12 18 20 M0 18 1 20 M02 18 M 03

FLAT

12 MONTHS OF TRANSACTION LEVELS In this chart, we display the level of transactions in the last 12 months. Instead of showing the absolute values, we show how the transactions in that period vary from the same month a year before. For example, the data for March 2018 shows us that the transactions were 32% lower than 12 months prior.

Year-on-year changes in transaction levels

40%

20%

0%

-25%

03 8M

01

20 1

M

01

20 18

M 17 20

17

M

12

11 20

M

20

17

10 M

20 17

17

M

09

08 20

M

07

20 17

17 M

06 20

20

17 M

05 17 M

20

20

17

M

04

-50%

Source: ResiAnalytics


TIME ON THE MARKET The latest available data shows that on average it takes 56 days to sell a property. Over the course of the last year, the average figure was 60 days, so the latest data is 4 days shorter than the long run average. 75

Time to sell (days)

70

65

60

55

54

50

55

55

May 2017 Jun 2017 Jul 2017

57

58

59

62

67

72

65

61 61

61 59

56

Aug 2017 Sep 2017 Oct 2017 Nov 2017 Dec 2017 Jan 2018 Feb 2018 Mar 2018 Apr 2018 May 2018

NUMBER OF PROPERTIES ON THE MARKET The latest available data shows us that on average estate agents in the UK have 50 properties on their books. Over the course of the last year, the average figure was 47.2, so the latest data is 2.8 properties more than the long run average.

Average properties available per estate agent

50

48

46

44

42

49

50

50

May 2017 Jun 2017 Jul 2017

50

49

48

47

43

42

43

45

47

50

Aug 2017 Sep 2017 Oct 2017 Nov 2017 Dec 2017 Jan 2018 Feb 2018 Mar 2018 Apr 2018 May 2018

N.B. In January 2018 Rightmove adjusted their methodology and altered the data retrospectively which is why these figures vary from previous editions of this report.

Contact us now for a free valuation Tel: +44 (0)207 079 1515 | parklane@fineandcountry.com | fineandcountry.com

F&C National Report, July 2018  
F&C National Report, July 2018