Wellingborough Property Market Update – April 2023

about 1 year ago
Wellingborough Property Market Update – April 2023

With the first quarter of 2023 now having passed, I’ve taken a look at the latest data available from ZooplaPro to see if we can spot any trends in the Wellingborough property market.

There were 688 properties for sale during some point in March, which is 44 more than in February and 87 more than March 2022. Not only were there more properties up for sale, After two months of the average asking prices in Wellingborough dropping by £2,230 (0.8%) to £275,527, asking prices in March averaged £277,308 which is £16,750 (6.4%) higher than twelve months ago.
However, even though the number of properties for sale and the asking prices have increased, the percentage of properties that had actually sold (STC) dropped to 9.4% from 10.7% in February and 12.4% in January.

Asking prices of properties new to the market increased by £7,225 (2.6%) on February asking prices to £283,618. Despite this increase, average asking prices are down on 2022’s peak of £278,030 in July by 4.8% (£14,140).

The number of price reductions we have recently been seeing is begining to reduce. In November 2022, January and February 2023, 10.3%, 10.1% and 9.8% of vendors reduced their asking prices. This dropped to 8.9% in March. (December has been excluded as the property market often goes into ‘mini-hibernation’ over the festive period, and reductions were just 6.0% in this month)

For the whole of 2021, just 2.5% of properties had a price reduction.

In the first half of 2022, this was 3.3%

In the second half of 2022, this was 6.4%

Whilst this is largely positive news that it looks like the market is begining to level out, there appears some way to go (possibly beyond the end of 2023).

However, there is some better news when we look at the average asking price of SOLD properties.

The asking price of sold properties increased by £29,696 (13.1%) from January to March. Likely due to more buyers coming to the market after the Christmas period and the reduction in interest rates for mortgages, leading to more affordable borrowing – even though the Bank of England increased rates to 4.25% at the end of March, there are still some 5-year fixed deals that can be found for under 4%.

There is still quite a big disparity of £21,548 (8.4%) between the asking price of new properties for sale versus sold properties. I believe this gap still needs to reduce by either increasing buying power or asking prices falling for a stable market to emerge.

In all likelihood, I think that mortgage rates are going to be about as low as they will be for a while, which means asking prices will need to come down a little further – around 5-10% – so that there will be enough buyers (not just those lucky enough to be able to get a great rate) who are able to fulfil the supply of homes.

If asking prices were to drop by 10%, this would put them at £249,577 , or around the same price they were in November 2021 (£251,019).

The Rental Market

The average asking price for a property to rent in Wellingborough now stands at £842. That is £84 (11.1%) higher than 12 months ago and £139 (19.8%) higher than January 2021.

Mortgage rates are increasing, regulation on rented properties is increasing and the recent changes in capital gains tax and the scrapping of tax relief on buy-to-let mortgages are all driving some landlords to sell up and leave the rental market entirely, which will ultimately affect supply negatively.

According to research carried out by Simply Business, 61% of landlords sold a property in 2022 or are planning on selling a rental property in the near future with only 23% of landlords saying that they intended to purchase an investment property to rent out.

This could lead to supply and demand issues, ultimately resulting in higher rents. Recently, Knight Frank predicted rent rises to slow over 2023 and beyond, but still rise by around 4% for the rest of the year.

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