We reflect on 2022 and prepare for 2023

Mon, 23 Jan 2023 | Sales market update

As one oJ58f our valued clients that we have dealt with in the past, we would like to share our property market views with you on 2022, a year with an ever changing landscape and prepare ourselves for 2023, in a market that we envisage will turn back to normal.

Prior to the pandemic, we had seen relatively stable changes within the property market for both capital values and rental returns. Over the period from 2020 to 2022 saw a lift in property prices by some 29% as people’s and family’s demands increased for a different style of living. With more people opting to work from home than ever before, the London and major city buyers took a fresh look at possible moves to the suburbs and countryside where prices by comparison are more affordable. In addition to this geographical shift, there was a reduced number of new landlords entering the property market, helping catalyse a 23% surge in rental prices. The old cliché ‘supply and demand’ has certainly played a huge role in these increased prices within both the sales and rental markets.

With legislation changes and shifting tax policies on landlords, the lettings market had seen some landlord clients take advantage of the buoyant sales market and decided to sell their assets. However, over the latter half of 2022, we have observed a significant drop off in rental properties being sold as landlords benefit from increased rental prices. This has promoted a more positive opportunity for both sellers and landlords, particularly bearing in mind property values have doubled over the last ten years and with the forecast remaining strong for the future.

The start of 2023 is critical from a residential sales point of view, buyers and sellers will be readjust their budgets with new mortgage rates. When compared to the last few decades’ interest rates, particularly the early 1990s at 15%, borrowing is still relatively affordable.

Our view is that property values and rental levels are rebalancing. The past has showed us that any corrections are always positive, particularly following what has been a bullish market. Interestingly in the first half of December 2022, which traditionally sees an understandable drop off in enquiry levels, Prospect registered as many buyers and tenants in that period as we did in the first half of November 2022. This is optimistic news as we enter 2023, showing signs of a resurgence in confidence in the future of the property market.

To help you evaluate your property choices for 2023, we would relish the opportunity to provide you with a free financial overview to include property value, rental potential and mortgage advice where needed. This will help provide you with all the options and an informed opinion prior to making your property decision this year.