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Lancaster and Morecambe Bay Housing Market

Lancaster and Morecambe Bay Housing Market Update

Lancaster and Morecambe Bay Housing Market Update: Spring 2023.

The UK housing market has been experiencing a decline in annual residential property prices, with a YoY decrease of 3.1% in March, according to mortgage lender Nationwide. This marks the biggest price drop since the financial crisis, mainly due to the uncertainty created by last year’s mini-budget in September 2022, which is still being felt. As a result, the housing market is struggling to recover momentum, with weak consumer confidence and household budgets affected by high inflation.

The housing market in the Lancaster and Morecambe Bay area is also feeling the impact of these challenges. However, we have found that transaction levels remain stable and that the volume of new properties coming onto the market is steady. Committed buyers and sellers are slowly returning as morale improves, although there is still some uncertainty about the future.

Despite the challenges, the Lancaster and Morecambe Bay housing market shows signs of resilience. For example, some flexible sellers are more likely to accept below-asking-price offers to hasten the sale of their homes, and stock levels are increasing, thereby providing more space for price negotiations. These factors suggest that the housing market is adjusting to the current challenges and is poised for a more realistic and efficient sale.

One of the factors that is likely to affect the housing market in Lancaster and Morecambe Bay is the level of demand from potential buyers. Although prices are expected to decrease by around 8% this year, bringing them back to 2021 levels, it is unclear how many buyers will be willing to purchase homes in the area. Some may be deterred by the economic uncertainty, while others may be holding out for better deals.

However, there are some positive factors that could help to support the housing market in the area. For example, the Lancaster and Morecambe Bay area is known for its natural beauty and attractive coastline, which could make it attractive for buyers looking for a second home or a retirement property. In addition, the area has good transport links to other parts of the country, which could make it appealing to commuters.

Another potential factor that could impact the housing market in Lancaster and Morecambe Bay is the level of new construction. Although the volume of new properties coming to the market is steady, it is unclear how many of these will be new builds. A significant increase in the number of new builds in the area could help to boost demand from buyers looking for modern, energy-efficient properties.

In conclusion, Lancaster and Morecambe Bay’s housing market faces challenges due to the uncertainty created by last year’s mini-budget and weak consumer confidence. However, there are signs that the market is adjusting to these challenges, with committed buyers and sellers slowly returning as morale improves. Although prices are expected to decrease this year, the future of the housing market in the Lancaster and Morecambe Bay area will depend on a range of factors, including demand from buyers, the level of new construction, and economic conditions more broadly.

We here at CoastnCountry know what it takes to sell for the maximum price and we are happy to advise on any improvements to make your home more sellable. Want to find out more? Please contact kellie or Sarah at coastncountry.co.uk or call 01524 389814. 

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Lancaster house prices rise by 1.8%

Coast N Country Lancaster Property Sales

Lancaster house prices rise by 1.8% and buck the national trend.

House prices in Lancaster bucked the national trend in September by continuing to rise.

New figures show they increased by 1.8% – more than the North West average for September,.
The rise contributes to the longer-term trend, which has seen property prices in the area grow by 13% over the last year.
The average Lancaster house price in September was £198,963, Land Registry figures show – a 1.8% increase on August.

Over the month, the picture was different to that across the North West, where prices increased 0.6%, and Lancaster was above the UK as a whole, where prices did not change.
Over the last year, the average sale price of property in Lancaster rose by £23,000 – putting the area 20th among the North West’s 39 local authorities with price data for annual growth.
The highest annual growth in the region was in Warrington, where property prices increased on average by 20.4%, to £266,000. At the other end of the scale, properties in Barrow gained 3.6% in value, giving an average price of £145,000.
An imbalance between supply and demand for properties saw house prices climb across the UK throughout the pandemic.
But typical property values stalled across the UK between August and September, which caused annual growth to slow.

Andy Sommerville, director at property data provider Search Acumen said the latest data is further evidence of “a turning tide for house prices”.
The figures are yet to reflect the full impact of the mini-budget, announced towards the end of September, which sparked volatility in the mortgage market and saw interest rates on new agreements soar.
Nicky Stevenson, managing director at estate agent group Fine and Country said: “Annual house price growth slowed in September against a backdrop of rising interest rates and shrinking disposable incomes.”

First steps on the property ladder.

First-time house buyers in Lancaster spent an average of £175,000 on their property – £20,000 more than a year ago, and £44,000 more than in September 2017.
By comparison, former owner-occupiers paid £222,000 on average in September – 27.2% more than first-time buyers.

Owners of detached houses saw the biggest rise in property prices in Lancaster in September – they increased 2%, to £343,312 on average. Over the last year, prices rose by 14.5%.
Among other types of property:
Semi-detached: up 1.9% monthly, up 13.5% annually, £211,620 average; Terraced: up 1.9% monthly, up 13.2% annually, £172,880 average flats: up 1% monthly, up 8.6% annually, £114,531 average.

How do property prices in Lancaster compare?

Buyers paid 9.2% less than the average price in the North West (£219,000) in September for a property in Lancaster. Across the North West, property prices are lower than those across the UK, where the average cost £295,000.
The most expensive properties in the North West were in Trafford.
The highest property prices across the UK were in Kensington and Chelsea.

Average property price in September.

*Lancaster: £198,963; North West: £219,005; UK: £294,559
*Annual growth to September
*Lancaster: +13%; North West: +9.1%; UK: +9.5%
*Highest and lowest annual growth in the North West
*Warrington: +20.4%; Barrow: +3.6%

First Published November 17, 2022 | Debbie Butler. @ lancasterguardian.co.uk

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Investment Property News

Property Investments

Chronic shortage of private landlord homes continues to push rents higher.

Investment Property News September 2022

Renters are being pushed towards smaller properties and lower running costs in the face of higher rents and rising living costs including rising energy prices, new research shows.

According to Zoopla’s latest quarterly home rental market report, the average rent has increased by £115 per month since last year, reaching £1,051 per calendar month – and accounting for 34.4% of the average income of a single earner. This surge in rents is heavily impacted by a severe supply and demand imbalance with the stock of homes available to rent standing at just half of the five-year average – while the average letting agent currently has just eight homes available to rent.

This chronic supply shortage is also impacted by an increase in renters staying put in their properties to avoid rent hikes and landlords continuing to sell properties in the face of tax and regulatory changes. Currently, approximately 3 in 4 renters will decide to stay in their current property and although they will experience lower levels of rental growth of 4% or less – this will squeeze supply in the market as a result.

There has been an acceleration in demand for one and two-bedroom flats as renters feel the cost-of-living squeeze, and fewer renters looking for two and three-bedroom houses. Outside of London, the average asking rent is £105 lower per month for a two-bedroom flat compared to a three-bedroom house.

Renter demand shifts to 2-bed flats for better value & lower running costs

Renters making decisions about what type of property to rent will also consider running costs and rising energy prices are likely to be playing a role in the shift in demand to smaller homes.

When it comes to energy prices, the amount of gas to heat and run a purpose-built flat for a year is 40% lower than a terraced house and 25% lower for a converted flat. New-build city centre flats are also becoming increasingly appealing to renters seeking out smaller homes with lower running costs.

Rental growth has accelerated over the last 12 months from an annual rate of less than 2% in July 2021 to 12.3% today, while rental growth is out-pacing earnings growth in all regions and countries of the UK. Rental growth is ranging from 7.6% in the North East to a staggering 18% in London – however, there are signs that rental growth is close to peaking.

Despite rents in London rebounding from a low base, the pace of rental growth in London is not sustainable at current levels with average rents in London currently 7.8% higher than pre-pandemic.

In a reversal of a trend seen during the pandemic, rental growth in urban markets (10.5%) is now outpacing that in rural markets (8.5%) as strong employment growth drives demand in cities.

The strongest performing urban markets are London (17.8%). Manchester (15.5%), Glasgow (14.4%) and Bristol (12.9%) – where rental growth is standing above the UK average of 12.3%. Rents are also rising faster at the top end of the market with asking rents for 2-bed flats rising more quickly at the upper end (top 25%) of the market in comparison to the lower end of the market where demand is more price sensitive.

What is the outlook for the rental market?

There is no real prospect of significantly improved rental supply in the near term as private landlords and property investors continue to sell off homes due to tax and regulatory changes. Renters renewing their tenancies will also amplify the fierce supply squeeze and keep upward pressure on rents into 2023.

There is headroom for some renters to pay more, especially outside London and the South East, however overall, we expect the headline rental growth to slowly taper over Q4 and into 2023.

Richard Donnell, executive director at Zoopla, said: “Rents have surged ahead over the last year but there are signs that the pace of growth is peaking and set to slow into 2023. Renters are responding and looking for smaller, better value for money homes to rent with an eye on energy costs as much as rental levels.

“What the rental market needs to combat these challenges is more new homes for rent. Greater regulation has seen less new investment and a small but growing number of landlords selling up, meaning the rental market has stopped growing since 2016. There is a risk that more regulation to improve standards or potential new measures to dampen rental growth, as proposed in Scotland, may compound the supply problem which is pushing rents up in the first place. Policymakers need to tread a careful path between protecting consumers and ensuring a decent supply of homes for rent.”

Hannah Gretton, lettings director at LSL’s Your Move and Reeds Rains brands, commented: “We are experiencing high levels of demand for rental properties with homes being snapped up within hours of hitting the market. With over 270 lettings branches nationwide, it’s a picture that is reflected up and down the country with particular demand in urban areas.

“On average, we are seeing double figures of enquiries per property with a one-bedroom property in Manchester last week receiving over 100 requests to view, highlighting just how busy our branches are and the challenges renters face when it comes to finding an appropriate property”

First Published September 13, 2022 | Marc da Silva. @ propertyindustryeye.com

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