The British fixation on the weather and house prices are without equal and right now both are hot.
The imbalance of available property to sell and consumer demand continues to drive the residential property market and a shortage of house building – resulting from a constipated planning system, delivery of materials and lack of available skilled labour – will not be solved in the short term.
In June, Halifax Building Society stated month saw the 12th consecutive national monthly property price increase.
In Bedford (according to Rightmove) the average property sale in the last year was £299,405, over £4.5k higher than the national average house price of £294,845.
How and when does it all end?
The cost of living squeeze must surely cool things down but that does come against a very hot starting point.
Ordinarily, it is interest rate rises that trigger a property market downfall but despite higher rate levels being the standard anti-inflationary medicine, we can still find favourable long-term fixed mortgage deals.
Interestingly, it is possible to get, within certain criteria, a 10-year fixed mortgage below 3%.
The big lenders are therefore not predicting either long-term or large rate increases.
The other devil in property market heaven is unemployment.
At the time of writing, unemployment is below 4% – lower than pre-pandemic rates so it appears that this will not stir the property market to any great extent.
General affordability will no doubt see equilibrium within the marketplace and a plateauing off but there is no sign that house prices will start to reduce in the foreseeable future.
by Russell Beard
Chairman, the Beard Group
