Cheadle Property Market Update July 2022
What’s another month?
July has been another turbulent month with no sign of any stability returning to the market or economy any time soon. The cost-of-living crisis is deepening for many hard-pressed families, petrol prices seemingly climbing by the day, spiraling inflation and no sign of an end to the awful conflict in Ukraine.
Added to this the continuing chaos at our seaports and airports causing misery for holiday makers, strikes and the tory party finally ditching Boris Johnson – in favour of either Rishi Sunak or Liz Truss! At least the month finished on a positive note with the magnificent victory for England’s Lionesses in the final of the Women’s Euro’s final!
The National press and media continue to talk down the housing market and economy, regularly predicting a scenario where prices drop 10-20% and nobody is buying, whilst there is a massive influx of people trying to sell out of necessity. The reality of course remains somewhat different, but there are storm clouds gathering on the horizon.
The Nationwide’s Chief Economist, Robert Gardner, confirmed that prices climbed 11% in the last twelve months, although the rate of increase has now dropped to just 0.1%. The average house price now stands at £271,209.
Mr Gardner continued “There are tentative signs of an underlying slow down in activity, but demand continues to be supported by strong labour market conditions, where the unemployment rate remains near 50-year lows and with the number of job vacancies close to record highs,”
“At the same time, the limited stock of homes on the market has helped keep upward pressure on house prices.”
First-timer buyer mortgage completions remain around 5% above pre-pandemic levels, according to the Nationwide, despite the rising affordability pressures caused by the cost-of-living squeeze.
“First-time buyer numbers remain strong but that is likely to reflect significant financial input from the Bank of Mum and Dad, as deposit levels rise along with house prices and interest rates,” said Mark Harris, chief executive of mortgage broker SPF Private Clients.
Borrowers remained extremely keen to secure a fixed-rate mortgage before rates go up again, as they are expected to later this week, he said. “Minds are focused on getting deals done before the cost of borrowing inevitably rises further still.”
New listings show surprising upward surge
So, lets drill down into the local market a little more and take a look at what is happening in the SK8 and SK3 area and compare with the national picture.
Looking at the number of new listings coming to the market, July has seen the biggest increase for over a year at 174 versus 134 in July 2021 – an increase of 28%. What is still not clear is this people starting to worry about a potential slow down, so deciding to sell now, or perhaps people starting to the feel the pinch financially and potentially looking to downsize? This is something we will be keeping a very close eye on over the next two to three months as we head towards the Winter.
Interestingly, there was a huge 131% increase in the number of detached homes coming to the market and a 39% increase in the number of semi-detached houses. However, on the flip side there was a drop in the number of terraces, flats and bungalows that came available.
Is Buyer interest dropping?
The first indication that consumer/buyer interest is cooling is reflected in the number of daily property views on Rightmove, which dropped from 180 last July to 153 in July 2022, a drop of 15% even though more properties came onto the market? And the available stock for the month averaged out at 468 against 439 last year, an increase of 6%
The Halifax recently reported that buyer interest had dropped across the country by 30%. Obviously, we haven’t noticed anything quite so dramatic, but there is clearly a trend starting to develop and that could be accelerated as the cost-of-living crisis puts more pressure on family budgets and any subsequent interest rate rises which would act as a double whammy.
Detached and Semi prices still up, terraces and flat dropped in SK8 & SK3
The year-on-year average percentage price increases have been dropping now for several months. However, if you own a detached home in the area, prices year on year are still showing a healthy 6.7% uplift and stand at an average of £479, 200. Semi detached homes have increased 8.4% and are now worth an average £341,700. Terraced homes have dropped ever so slightly by 0.3% to an average £267,400 and flats have taken the biggest hit, dropping 11.8% and now stand at an average £172,300.
We will of course be continuing to monitor this over the coming months to see if there are any significant changes.
Sales show welcome upturn in July
The final image looks at the number of properties sold in the area in July. It has been quite a roller coaster in recent months and June saw quite a significant drop, which many took as the start of the predicted crash in the market, however the number of properties sold actually increased! Up 6% on the previous year.
The number of detached house sales are up 27%, semi detached homes 15% and flats up 18%, whilst the number of terraced homes has dropped 27% and bungalows 15% respectively.
The market in the Cheadle area is showing tremendous resilience and well-priced property is still selling quickly and creating high demand. Undoubtably around the perimeter, there are some ominous signs looking and demand across the country is does appear to be dropping and we feel that will start to creep into the SK8 and SK3 markets, towards the end of Q3 and certainly by the end of the year, the landscape may look slightly different, in particular as the next round of the increased energy cap and escalating prices, added to any further interest rate rises and rampant inflation, which will be waiting at the top of the next prime ministers in tray come September.
Given what we are seeing in the trends amongst buyers, our advice remains it is probably advisable to bring any selling plans you have forward to safeguard a sale of your home at the best possible price. The picture is now becoming increasingly uncertain, and the Bank of England are now saying that this recession is going to bite harder and last longer than they first envisaged and that they are not going to be able to bring inflation under control quickly, therefore we feel things are likely to get tougher in the short term at least and this will inevitably impact the house market.
If you would like to know the current value of your home in today’s market, please call Joe, Patrick or Maurice on 0161 428 3663, e-mail email@example.com or visit our website, choose your preferred method of market appraisal and book online – Book a FREE valuation
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