As the heartbeat of the British economy, the housing market is highly sensitive to various factors, one of which is interest rates. Recently, the United Kingdom has experienced a series of interest rate hikes, leaving homeowners, potential buyers, and real estate professionals pondering the consequences. In this blog post, we delve into the effects of these interest rate increases on the local property market in East Molesey, Claygate, and Thames Ditton, three vibrant communities within the beautiful Elmbridge area.
Understanding Interest Rate Hikes: To grasp the implications of recent interest rate hikes, it is essential to comprehend why they occur. Interest rates are influenced by the monetary policy decisions made by the Bank of England (BoE) to control inflation and maintain economic stability. When the BoE raises interest rates, it becomes more expensive to borrow money, affecting mortgages, loans, and overall market dynamics.
The Impact on Local Property Prices: Interest rate hikes can have a direct impact on property prices in Elmbridge and its surrounding areas. As the cost of borrowing increases, potential buyers may face higher mortgage repayments, leading to a decrease in affordability. This could potentially slow down the demand for properties and, in turn, influence pricing levels. However, the impact may vary depending on factors such as local market conditions, supply and demand dynamics, and the overall desirability of the area.
Effects on Buyer Behavior: In a climate of rising interest rates, prospective buyers often reassess their purchasing decisions. Affordability concerns may cause some buyers to postpone or reconsider their property search, opting for more conservative choices. On the other hand, some individuals might perceive the rate hikes as a signal of a strengthening economy and view it as an opportune time to invest in property before prices potentially rise further.
Shifting Dynamics for Homeowners: Existing homeowners within the Elmbridge area may experience a change in their financial circumstances due to interest rate hikes. For those with variable-rate mortgages, the increase in rates will lead to higher monthly mortgage repayments. Consequently, homeowners might adopt a more cautious approach, focusing on budgeting and potentially reducing spending on other areas of their lives.
The Role of Supply and Demand: The local property market in East Molesey, Claygate, and Thames Ditton is driven by a delicate balance of supply and demand. Interest rate hikes can impact this equilibrium. If demand decreases due to higher borrowing costs, the number of potential buyers might decline. Conversely, a decrease in demand could motivate sellers to reevaluate their pricing strategies, leading to more competitive offers and potentially a more balanced market.
The recent interest rate hikes in the UK have undoubtedly cast a ripple effect on the local property market in East Molesey, Claygate, and Thames Ditton. While there may be short-term adjustments in buyer behavior and property prices, it is essential to consider the broader economic context and long-term market stability. As trusted estate agents in Elmbridge, we remain dedicated to providing up-to-date insights and assisting our clients in navigating these changes effectively.
Remember, the impact of interest rate hikes on the local property market is a dynamic process, and monitoring the ongoing developments is crucial for both buyers and sellers. Stay informed, consult professionals, and make informed decisions to ensure your success in this evolving landscape.
Agents are currently only permitted to carry out “virtual viewings” on vacant properties, and mortgage lenders are putting a temporary stop to new mortgage applications whilst restrictions prevent their surveyors from valuing properties with usual accuracy, given that they cannot physically visit the vast majority of properties at present.
The only ones that are still moving home, are those that are well progressed with their sale or purchase and are contractually bound to move. The same more or less applies to those renting as well, with virtual viewings applicable to vacant properties only, and only those that absolutely have to move are able to do so.
Prior to the outbreak of COVID-19, the property market was doing extremely well, and there was already strong evidence that the so called Boris Bounce was having a positive impact on the property market.
Our own data showed a 14% increase in the number of property viewings immediately following the election, and an overall increase of 32% when compared with the same period in 2019. This was also evident in the most recent property transactions for 2020, showing an increase in the average price paid for a property in Thames DItton, Esher, Claygate, Hinchley Wood and Molesey of £25,000.
Right now, we should be experiencing one of the busiest seasons for the property market, commonly known as the Spring Market, but restrictions are preventing people from bringing their property to market, causing a back log of people that were planning to move at this time.
Can you think of another recent event that was talked about in the news every day that may have also had a bottleneck effect, and created a back log of people that were waiting for more certainty before putting their property on the market…?
The EU referendum in the UK along with amendments to how stamp duty land tax is calculated, reduced transactions in Molesey, Esher, Thames Ditton, Claygate and Hinchley Wood by around 30% and as a result, 2020 was expected to be a busy year for the UK Property market with pent up demand reaching critical mass.
We now have one bottle neck on top of another bottle neck, and if the data tracking property transactions in South Korea and China is anything to go buy, we can expect transaction levels and the health of the property market to snap back at an exceptional pace.
With the UK’s own specific set of circumstances leading up to this point, we are expecting a wave of new properties coming to market in the second half of 2020.
If you are one of those people that are planning to sell your property once life begins to return to normality, is there anything that you can do to beat the crowd?
You may or may not already know that you can instruct a solicitor before you find a buyer. Our panel of solicitors work just like our estate agents do, on a No Sale, No Fee basis.
Why does this matter? The initial process of setting up the sale of your home with a solicitor takes anywhere from 2-3 weeks. Most people wait until they have a buyer to begin this process, but if everyone is trying to do this at the same time, it will likely take longer than usual for the initial steps to be completed.
If you are serious about moving, why not put yourself in a position where you are up to 3 weeks further ahead than other properties that launch to market? There’s no catch, and you don’t even have to use Newton Huxley Estate Agents to sell your property to get access to this service. However, if you decide to take advantage of our award winning estate agency services, your solicitor fee payable upon the completed sale of your home will be absorbed into the commission we charge, saving you an average of at least £1000.00
For more information please contact our team on 01372 631 622 or email firstname.lastname@example.org
You may be thinking of moving, or more likely, you are just interested to know if the value of your property has gone up or down. It can be really difficult to guage what is happening with property values, some estate agents are always talking up the market, and the media is generally extremely negative and apocalyptic about the housing market around Surrey and London.
Let us cut out the rhetoric and the "sales spiel" and get down to some undeniable cold hard facts!
For most of us, it feels like 2008 was only yesterday, the recession hit and transaction levels went through the floor. As an example, the KT10 postcode area (Esher, Claygate, Hinchley Wood) dropped from over 400 annual transactions to just 184. Since then transactions have increased until the most recent peak in 2013 of 446 total transactions. There has been a steady decline in the number of transactions since then, and in 2017 the Land Registry recorded 354 transactions across Esher, Claygate and Hinchley Wood. The level of transactions has declined by 21% since the most recent peak in 2013, but has increased by 4% over the last year. Hardly a disaster story and by contrast to 2008 levels, a very healthy market place indeed.
A similar story applies to areas like Molesey and Thames Ditton, with transaction levels down 21% over a similar period, and still way above 2008 levels.There really is no comparison to the 2008 recession that has been quoted by some of the more dramatic media sources. To sum up, we are not at the "height" of a market trend but we predict prices to remain where they are for the next 2-3 years with modest fluctuations of around 5% +/- throughout this period.
So you know transaction levels are still high, just not as high as they’ve been before, and we know what we're all really interested in… The value of property!
Last year property values across Molesey, Esher, Claygate, Hinchley Wood and Thames Ditton slipped slightly, with the lower end of the market dipping around 5% and the £1m + market dipping by 7% or more. This was purely down to affordability issues and scepticism from would be buyers. As a company, we experienced a market where buyers wanted to buy with interest rates at an all-time low, but sellers were still hoping for record breaking prices creating a gap that either the seller, or the buyer needed to fill. As the consumer dictates the price of a product by demand, this quickly formed a "buyers’ market" mentality, but once asking prices were adjusted, there were plenty of buyers for every property as they jumped at the chance to secure a reasonably priced home.
Since the beginning of 2018, house values have increased across all of the areas we cover: KT10 by 5%, KT8 by 3.14% and KT7 by 5.43%, this shows that the adjustment in asking prices last year from the majority of sellers created more competition from buyers and therefore, persuaded buyers to part with (or borrow) more cash to purchase their next home.
What we are still seeing is an extremely price sensitive marketplace, overestimating your property's value or listing with an agent purely because they provided you with a surprisingly high and intoxicating valuation, can cost you in the long run. Where properties remain on the market for longer than expected, buyers will assume you are desperate to sell and we have in extreme cases, received offers 15% below asking price. This will hinder your chances of getting market value and will make it nearly impossible for your agent to negotiate the best possible price for your property. Correct asking price = hordes of buyers = multiple offers = best price AND best position to proceed.
If you are thinking of selling, look at the sold history in your area on either Rightmove, Zoopla or Land Registry, asking prices are not always, what a property will sell for. Check how long a property has been on the market for, ask yourself why it hasn't sold if it has been on the market for months. Get multiple valuations from agents who have a good record of accomplishment in your area, listen to the facts and evidence rather than just listening to what you hope to hear. In an age where "fake news" has penetrated the majority of information sources, only the facts and evidence that you can verify matter, and that is all a buyer will consider – unless they fall in love with your property and have to submit a sealed bid because there are multiple interested parties! They are more likely to consult their mortgage broker than sold data at that stage!
If you are thinking of selling, would like clear advice on the value of your home and the best marketing strategy to adopt when and if you decide to sell, please call our sales team on either 0208 396 6717 or 01372 631 622 for more information. Alternatively, you can book a FREE valuation by clicking the link below.
Figures from August show UK mortgage borrowing increased by the largest amount since the economic crash and should be taken as another sign that the housing market is heating up.
According to the Financial Times mortgage lending rose £3.4bn. The amount of new mortgage approvals for house purchases have reached an 18-month high of 71,000, according to figures released last Tuesday by the Bank of England.
Approvals for mortgaging also rose in August from the previous month as home owners sought to lock in current low interest rates deals.
Expert analysts are constantly warning that a shortage of supply on the market has been driving up values, especially in the London and Greater London Area.
With this in mind, if you are thinking of selling now is the perfect time to come to market before the Christmas market hits and buyers slow down. If you are about to come to market or already selling and you are without a buyer, call us to find out more about these findings and how our results back this information.
Sam Kamali | Diretor of Residential Sales
0208 396 6717 (option 1) | email@example.com
It is vital you instruct an agent who understands what lies ahead and has the necessary measures in place to see you through to the finish line. With the increase in sales activity the legal process is not likely to be in a position to keep up. With the land registry preparing to take over the property search process, local authorities are refusing to invest in the technology and resources required to improve the current system and as staff are leaving not a lot seems to be going ahead in terms of replacing them.
It is because of this that our team at Newton Huxley deal with recommended and approved solicitors, take extra care when agreeing sales, and stay on top of the progression as this is the most vital part of the process that needs an agent to deliver and work effectively.
The average national fall through rate for 2015 is reported to be as high as 27.5% to date, to find out more about how we operate differently from other agents, achieving a fall through rate of just 12.5%, please contact us on 0208 396 6717 or click this link to go to our valuation page and book your appointment today.
We are about to enter a sellers’ market, Halifax has put the average house price at £200,280, 3.3% higher than three months ago and up 9.6% from 12 months ago.
Martin Ellis, Halifax economist has said that the shortage of new properties coming onto the market has been a major factor in house price growth this year.
In a recent report from RICS (Royal Institute of Chartered Surveyors) confirms that the average number of properties on the market per estate agency is at a record low since 1978.
RICS said that both house prices and rents are likely to grow at a rate exceeding growth in wages.
Corporate Estate Agency LSL have also reported a 15% increase in sales last month. Signifying the start of the anticipated post-election boom.
Is it really a sellers’ market? We think so. Having reviewed transactions throughout the first six months of 2015 we can confirm there has been a steady increase in buyer activity. We can also see evidence that properties will begin securing buyers that have previously struggled to sell. Here are our reasons why:
Tory Victory In General Election
Many believed the post-election market would immediately take off, however confidence in the market that was anticipated did not arrive. Homeowners that were expected to put their property on to the market post-election delayed their move creating a shortfall in property stock for proceedable buyers, which has increased demand to supply ratio significantly. This is the main factor in our achieving over 98% of asking prices throughout 2015.
Low Interest Rates
Attractive interest rates have not just increased activity from buyers, many homeowners have opted for a remortgage and to stay put, further exasperating the current market. Recent media reports suggest that interest rates are set to remain low for the foreseeable future. In some cases remortgages are saving homeowners £100's of pounds a month on repayments – if you would like us to put you in touch with a broker to explore potential savings please call us on 0208 396 6717.
Increase In Buy To Let Activity
Partly due the lower interest rates available, there has been a jump in the number of investors registering for buy to let opportunities, increasing competition for property even further.
So what is the right choice for you?
For a confidential discussion, whether or not you are looking to Sell or Buy in the East Molesey, West Molesey, Thames Ditton, Esher or Walton On Thames area please get in touch on 0208 396 6717, email firstname.lastname@example.org or request a valuation.
With the recent opening of the Sainsbury's Local on Walton Road in Molesey, we looked into whether or not this would have an effect on local house prices.
Research conducted by Lloyds Banking Group earlier this year found that the price of a property within easy reach of a supermarket, is on average 7% higher than comparable properties within the same town.
You may not be too surprised to hear that the brand of supermarket also comes into play with Waitrose scoring the highest percentage premium at 12%, Sainsbury's at 10% and Tesco's at 8%. Having an Aldi or Lidl close by may actually have a negative effect on the value of your home of around 2-3%.
The effects of local supermarkets really do vary from region to region but in monetary terms, houses within walking distance of a supermarket command an average premium of just over £15,000. Needless to say, this local convenience is high on the shopping list for potential buyers!
If you live close by to the new Sainsbury's on Walton Road in Molesey and would like an up to date valuation of your home. Please feel free to get in touch on 0208 396 6717, email email@example.com or send us an enquiry.
At the start of 2015 there was a lot of speculation as to how the election would effect the property market. Following our launch in January we noticed that the market was incredibly price sensitive with pre election jitters.
As we gained more momentum and built up the number of properties we were marketing we noticed that many of the properties coming to us that had been unsuccessful with other estate agents were selling, and quickly. One example of which was a property in East Molesey that had been marketed for around 4 months by two established local firms prior to coming on with us.
In 4 days we were able to source a buyer and an askng price offer. Since then (March) the market has gone from strength to strength with confidence from buyers and sellers at high levels.
We are extremely pleased to report that the post election market is incredibly buoyant and we are achieving record results on a number of properties, with an average 98% of asking price achieved throughout 2015!
If you are considering selling your property or are currently on the market and experiencing a similar situation to the one mentioned above, please do give us a call on 0208 396 6717 or contact us to arrange a valuation. Whilst we cannot guarantee the same result, you can be confident that if it can happen, our proactivity and positive attitude will make it happen for you.
Since December 2014 asking prices in Surrey have increased by 4.1%, although this increase is now showing signs of slowing down, demand for property is still high as shown below.
This impressive level of demand for property in the KT8 area leaves an average of over 59 home buyers per property. This is sure to keep the housing market in Molesey strong throughout 2015.
Government are promising more regulation within the rented sector, just one of many signs telling us that generation rent is here to stay. Locally, the KT8 postcode offers great choice and reasonable rent prices compared to neighbouring towns as listed below, further increasing popularity in the East and West Molesey areas.
If you are considering Selling or Letting your property with an Estate Agent in East Molesey, and require a specific valuation and market appraisal. Please contact us on 0208 396 6717 or email firstname.lastname@example.org
ALL VALUATIONS ARE FREE OF CHARGE AND OFFERED WITHOUT OBLIGATION