There have been quite a few pointers to the fact that the UK economy is not doing badly considering all the political upheaval the country has been facing and the same can be said of the housing market.
There are some interesting figures in the latest report from Rightmove. On the face of it an average increase in asking prices of 0.3% this month might not seem a lot to shout about. But what is interesting is some of the other figures.
For example, asking there were new all-time price highs in the East Midlands, the North West, Wales and Yorkshire and the Humber, pushing the national average to within £91 of a new record despite.
Rightmove says that market buoyancy in these regions is also reflected in better performance for both new sellers coming to market and sales agreed compared to the national average annual change for the year so far.
Indeed, the East Midlands, the North West, Wales and Yorkshire and the Humber are outperforming the national average in the key metrics of number of properties coming to market and the levels of sales agreed so far in 2019.
So, it should be no surprise that home owners in the North are more confident about the housing market outlook. The latest data from Zoopla’s sentiment survey found that overall some 80% of home owners believe that prices in their area will rise before the end of 2019.
But it is those in Yorkshire and Humber and the North West who are the most optimistic about their local property market and 91% of respondents in both areas expect house price rises over the next six months, followed by those in the North West at 90.5% and Scotland at 90.3%. In contrast, London is the least confident region, with only 67% of home owners expecting prices to rise and the South East at 74%.
Even the normally downbeat monthly report from the Royal Institution of Chartered Surveyors is more upbeat, suggesting that an improvement in sales is expected soon as negative trends appear to be easing.
Agreed sales, prices and new instructions all showed some signs of improvement and although sales expectations over the next three months are downbeat, it adds that a marginal boost is expected over the year ahead.
Whether or not these forecasts prevail, it is worth remembering that consumer sentiment is important when it comes to the health of the housing market. A feeling of stability means buyers are more likely to start actively looking for their next home, confident that now is the right time to do so. And active buyers will encourage sellers.
But there is one group that could have a lot more influence on the market and that is older home owners with the dilemma of keeping the family home and using the wealth in it, or downsizing or even moving to homes being specially built for retirees.
This sector is going to be dominant in the coming years as the population continues to age and trends are changing. The latest report from the Equity Release Council shows that 51% of home owners aged 45 and over see money invested in property as part of their financial plans for later life.
It says that many are facing multiple financial challenges as they seek to live longer, healthier lives while balancing their needs with providing support for younger generations. So they see property as the most important contributing factor to their financial comfort in later life with 68% saying so and 56% feel they should benefit from its financial value while they still live there.
The retirees of tomorrow, that is those aged 45 to 64, are less likely than their older counterparts to see property as something to leave behind as an inheritance. Instead, 55% are more likely to think of it as a multi-purpose financial tool that can support their own financial plans while 49% see it to being used as a nest egg to meet unexpected expenses and 25% to help family members.
This factor needs to be taken into account. If these older home owners don’t move then it is even more important that home building targets are ramped up and that means that 300,000 a year by the mid 2020s might not be enough, especially when the housing market remains resilient despite Brexit.
Ray Clancy
Editor Property Wire
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