We have reached an interesting point in what has been a most unusual year for the property sector.
The latest figures from the ONS house price index highlight that demand is still outstripping supply across the country.
House prices have far surpassed their 2008 levels but we’re now seeing those increases not just in London and the south east but right across the different regions of the UK, with record price levels in the north.
The Land Registry’s latest figures, published at the beginning of the month, are indicative of the slightly bumpy ride the market has taken over the last 10 months – with the General Election upsetting the peak we traditionally experience in the Spring and major events like the Rugby World Cup potentially throwing the autumn peak off course too.
Both have compounded the lack of supply of homes on the market.
Looking at the lending figures much of the growth in demand seems to be driven by the buy-to-let market – although the CML has said it thinks it is primarily a market recovery response.
Lending to first-time buyers, home movers, home-owner remortgage all dipped, however lending does continue to grow year–on year.
It will now be interesting to see whether there is a dash to move in the run up to the Christmas period, fuelled by Government schemes to get people into home ownership and interest rates remaining at their historic lows for the foreseeable future.
The overall effect on prices could be dramatic if the Government cannot resolve the longer term supply issues the market is facing.
The new Housing and Planning Bill which promises to deliver 200,000 new starter homes with 20% discounts for first time buyers will be an important step in resolving this.
We’ll be able to gauge a truer indication of exactly where the market is and, moreover, of what we can expect to see happening to it in 2016, as the New Year approaches.
In the run up to what we hope will be a prosperous period for the property market, an encouraging factor is the 43% decrease in repossessions since last year, reflecting the continuing confidence in the economy, growth in wages and employment as well as low inflation.
So I’m cautiously optimistic about the prospects for the sector going into 2016, but for it to be a great year for all home movers, we have to address the underlying supply issues.
*Eddie Goldsmith is Chairman of the Conveyancing Association and Senior Partner at Goldsmith Williams