2023 saw some changes in the economy and in turn the property market, here we look at some of the key moments that have affected the industry over the past year.
We have had the Material Information published, making property listings much more transparent for both Sales and Lettings. This gives buyers and renters more relevant information on the property prior to making an enquiry for better informed decisions ahead of any viewings or transactions being made.
Inflation has been somewhat of a roller-coaster over the past few years, with interest rates following in parallel to keep it at bay. We’ve finally seen inflation come back down after a record high over 11%, with interest rates expected to follow the downward trend in 2024 as both are on track to continue on a downward trend over the next two years. (Perhaps a tracker mortgage could be a brave but rewarding choice right now? Especially if you’re looking for something up until the end of 2025). Note we always recommend speaking with a mortgage advisor before taking out a mortgage.
The Autumn Statement from 2023 was much better received over the one from 2022. The statement was set out to encourage economical growth and build a better and cleaner future for the UK.
With the rental market having set record rents, new lets having more than 10% increases over existing rentals, residential lets have become much more profitable over commercial lets in many cases throughout the UK. This is further driven from the increased interest rates and restrictions imposed on many landlords that make private rentals much less favourable.
We have seen a decline in first-time-buyers as the rising interest rates have lead many to hold off the purchase of their first home. Continuing to rent, even with record highs, has meant they would have lower monthly payments in most areas of the UK over current mortgage repayments, this is especially true in the South East of England.
The mortgage guarantee scheme continues to benefit many first-time-buyers with many lenders on board, this enables you to get on the property ladder with only 5% deposit. We even saw the return of the 100% mortgage and a rent to buy scheme from one of the London based property developers. With interest rates on the higher end of the scale in relation to property prices and coupled with the cost of living crisis, there has been some innovation to help get people to own their home.
The renters reform bill had also been published and is going through parliament. The aim is to increase the standards of rental accommodation across the board. It has been part of making renting fairer and easier, which has been a gradual process since the tenant fees act in 2019 and the EPC for rental homes that are required to meet a minimum rating of E, with this increasing to C by 2028 (however, there will be some exceptions).
The government has been offering help for households, essentially to help combat the cost of living crisis; there has been support on income, bills and energy saving advice.
Despite all the the factors discouraging tenants renting, new lets have increased by 30% in the face of increased rent and scarcity of rental homes. Whilst those looking to buy have also looked at towns outside of cities with good commuter links. These changes have also led to homes becoming more valuable outside of major cities. With all this increased demand we also found that rental scams have become an issue, so please ensure that you are working with the right people.
