We have started 2023 busier than we expected and in order to understand this, it is perhaps good to rewind to 2022.
The first half of 2022 was also incredibly busy but, as the cost of living crisis started to bite, things slowed towards the summer. As we went into the autumn the debacle surrounding the mini-budget and subsequent rise in interest rates, caused many buyers and sellers to put their decision making process on hold and scaremongering surrounding the media suggesting interest rates would rise to 7% or 8%, worried the market. We found that as the year went on we got too close to Christmas and New Year for people to make any serious decisions, and therefore decided they would put their decision making on hold until early 2023. We have now found that most of these parties have come to the market and buyers are returning, especially as interest rates have not peaked as high as expected and most fixed rates are now settling around 4% or even slightly less.
We are finding that the ‘froth’ has come off the prices and whilst we are not seeing significant falls, properties are less likely to go to a best and final offer scenario, making more than their price. We are increasingly finding that sensible pricing is paramount and where we see this, a good level of interest is generated and sales are being achieved.
In regards to the rental market, tenants are increasing price sensitive and the more expensive rentals are tending to be overlooked in favour of cheaper options. I think this is likely to be the case whilst the cost of living remains high and tenants find ways to save money by renting something a little smaller.
We have also seen an increase in supply of properties, partially surrounding the decrease in short lets, as international travel has resumed and those that switched to short lets are now coming back to standard tenancy agreements as their occupancy rates have fallen.
We expect 2023 to be a little less volatile as a normal market resumes.