Whilst much of the noise surrounding the national housing market over the last 6-12 months has been rather grey – a lack of buyers, people only moving if they have to etc. – the market is also at its most inconsistent, writes Anton Frost, Partner, Cambridge Residential, Carter Jonas.
Our in-house research team recently released its National Housing Market Update and, when reading it, what really strikes is the disparity between regional markets. It is becoming increasingly difficult to provide a simple, national overview.
Cambridge is one of the areas that has remained strong, and the 2019 residential market has actually been more positive than much of last year.
Though price growth has taken a very small dip, the market is the most active that it has been for some time, as both buyer and seller confidence show signs of a resurgence. A slight decrease in price growth of 0.4 per cent has, conversely, led to an increasing number of serious buyers.
Our recent data report reveals that the average price for a property in Cambridge currently stands at £436,255, which is 1.5 times above the national average.
Colleagues in our residential sales team say that prospective purchasers had been circling the perimeters of the market for some time, in the hope that certainty over our departure from the European Union would inject stability back into the market.
However, with the political goal posts constantly moving, buyers have grown tired of waiting and are taking it upon themselves to restore momentum.
It appears that people are no longer prepared to put their lives on hold in the hope that our political situation resolves, and more offers are being made to the point where we are seeing some competitive bidding.
This is something we have not seen for some time; more instructions are coming in from motivated sellers as a result. This, coupled with vendors pricing more realistically, is generating more movement.
Nationally, the lettings market continues to perform well. On average UK rents have increased by around 1.2 per cent annually (ONS). This ranges between a high of 2.1 per cent in the East Midlands to 0.5 per cent in London and 0.4 per cent in the North East.
In Cambridge the lettings market remains extremely buoyant with prices averaging £1,350 per month and investors achieving stable gross yields in the region of 3.4-4.2 per cent.
We had expected the lettings market to be affected by increased legislation and financial regulation, causing investors and private landlords to leave the market - but this has not been the case.
Cambridge is a highly desirable city that commands a premium regardless of market conditions, which is why we have continued to witness healthy activity this year.
Our property markets are in large part driven by Cambridge’s high growth economy.
The city’s ever increasing business and academic communities, with high levels of employment growth, require places to live, and both the sales and letting markets benefit as a result
The buzz of rental activity predominantly lies in the city centre with high end, high specification stock feeding the top end of the market. However, we are seeing surrounding villages grow in popularity as families continue to move from London in search of larger homes with easy access to Cambridge’s lifestyle amenities.
Despite the ongoing political and economic uncertainty, it seems that in Cambridge we are feeling confident and I expect this momentum to continue. After all, September brings with it a new energy, a sense of starting fresh where we focus on what needs to get done by the end of the year. And, with just four months left, maybe it’s time to make that move.