Well, hasn’t 2016 been eventful. The ups and
downs of Brexit, the Queen’s 90th, Andy Murray winning Wimbledon, Trump,
Bake Off to Channel 4 and something close to the hearts of every buy to let
landlord and homeowner in Thanet ... the Thanet property market.
So, let’s look at the headlines for the Thanet
property market...
In the last month, Thanet property values dropped
by 0.38%, leaving them, year on year 12.3% higher, whilst interestingly, Thanet
asking prices are down 2.0% month on month. All three statistics go to show the
Thanet property market has recovered well after the summer lull, which was
worsened by the uncertainty surrounding the EU vote back in June. Irrespective
of all the issues, the average value of a Ramsgate home for example, now stands
at £228,000.
Generally, Thanet asking prices continue to
hold up well, as asking prices are 4.7% higher year on year. At this time of
year, asking prices tend to drop on the run up to Christmas and locally, they
have dropped by 2.0% this month (November 2016), although this still compares
well with last year’s drop in Thanet asking prices, as we saw asking prices
drop by 1.1% in November 2015.
Now it’s true to say, after chatting with
fellow property professionals in Thanet, all of us have seen the number of
property sales fall slightly, suggesting a slowing market, but it is very early
days and it could be the time of year. Also, the numbers are limited, so it’s
interesting to take note from a recent survey by the Royal Institution of
Chartered Surveyors, stating new buyer enquiries and new instructions are
falling at the same rate, suggesting that there will not be a downward pressure
on property values.
Looking at the
figures for the UK (as we can’t just look at Thanet in isolation), property
values are generally rising slower than a few years ago, but on a positive
note, there's still growth across the UK. You see, slowing property
value growth isn't solely Brexit related, but after a number years of
double digit rises in property values, affordability has weakened and cooling
price growth is widely seen to be a natural correction of the market.
On the other
hand, interest rates being at a record low of 0.25% are helping the property market. The cut in interest rates in the late summer was the medicine
for the post-Brexit worry and will, as a consequence, ensure that the UK
economy continues to be underpinned by buoyant property prices.
So, what will happen in 2017 in the Thanet
property market?
Some say until we know what type of exit the
UK will make from the EU it is hard to evaluate the outcome. Although, I
believe, the whole Brexit issue is a sideshow to the main issue in the UK (and Thanet)
housing market as a whole. As I have mentioned time and time again over the last
few months, the biggest issue is demand outstripping supply when it comes to
the number of households required to house us all. Thanet has an ever-growing
population: with immigration (we still have at least two years of free movement
from EU members into the UK), people living longer and the fact we need thousands
of additional households as the country has nearly 115,000 divorces a year
(where one household becomes two households).
These are interesting times ahead!
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