The Property Market In Review – Property News June 2023

June is almost over, and July is on the horizon. Here are all the important property news headlines you may have missed this month. From upcoming changes to fire safety, the impact on mortgages, and the resilience of the commercial sector, here’s the property market in review:

Zoopla And Rightmove Rental Market Report

Rightmove and Zoopla have unveiled their latest market reports – here are the most significant take aways from their research:

Rightmove released the June House Price Index, which showed:

• The average house price dropped for the first time in 2023, but only by £82. This makes the current average house price £372,812
• Buyer demand has not slipped, despite mortgage rate volatility
• However, sales agreed have slipped somewhat, being down 3% since last month

But how has the rental market fared? Zoopla’s June Rental Market Report showed:

• The portion of income spent on rent is the highest it has been in a decade, sitting at 28%
• Demand over summer is anticipated to soar by up to 40% – so, if you’re a landlord, now is the best time to list. If you’re a searching tenant with a flexible move-in date, we advise waiting until demand slows
• Talks of a landlord exodus are hugely overexaggerated. Private landlords are selling up, albeit not at a rate that is alarming or out of the ordinary

Ultimately, when you examine the data across the sales and lettings market, there is little need for concern. Be wary of fearmongering and talk to your local property agent for a more detailed understanding of the market near you.

Mortgage Rate Update

A hot topic in property news this June has been the increase in mortgage rates. The average mortgage rate rose to 6.07% for a two-year fixed, and 5.72% for five years, which is something the government is struggling to tackle. Chancellor Jeremy Hunt has ruled out issuing support measures to those with mortgages, claiming that the cash injection required would cause further inflation.

However, there are some rays of hope. There are still over 5,000 mortgage deals available on the market, with two thirds of these being fixed-rate. There is also an abundance of mortgage options available for those with small deposits. So, despite the decrease in mortgage options, there are still ample opportunities to find the best mortgage deal for you.

Similarly, Nicky Burridge at Zoopla stated that the mortgage market could improve sooner that we think, stating:

“If the next set of inflation figures are more positive, markets may decide interest rates do not need to increase by as much as they previously thought, and mortgage rates could start to come down.”

Fire Safety Act

Over the past month, you may have seen an increase in fire safety and cladding related content as the industry prepares for a slew of significant changes. June marked the 6-year anniversary of the Grenfell disaster which became a catalyst for widespread change to fire regulations. Here are the main headlines you need to know:

• The latest update to the Building Safety Act will come into force by 1^st October
• There are more remediation funds and procedures for poor cladding via the Cladding Safety Scheme, Waking Watch Replacement Fund and Building Safety Fund
• More thorough safety risk assessments through improved FRAEW guidance

We’ve created a simple guide to Fire Safety and Cladding Remediation to take you through all the relevant guidance, timelines and terminology. Click the banner below to download!

Commercial Update

We’ve covered changes across the residential property market, but how does the commercial sector fare this June?

According to Deloitte’s survey of Chief Financial Officers, 82% of CFO’s believe that their company’s financial prospects for the following year will remain stable or improve. This is a positive indicator for the commercial property sector as this suggests that businesses will continue to grow and create increased demand for office, retail and warehouse units. This is welcome news considering the mixed signals across real estate as a whole. There is a mixture of capital decline and strong occupier markets which Simon Durkin, Head of European Research and Strategy at BlackRock Real Assets, says will impact occupier markets at some stage, but most likely after the impact on the real economy. As such, this gives commercial real estate investors and occupiers ample time to make the right decision for their business.

Stay In The Loop With Centrick

Every month, we bring you the latest property news hot off the press so that you don’t have to scroll through the seemingly endless onslaught of available articles. We’re dedicated to providing balanced advice and valuable perspectives to our client base, allowing you to make the best possible choice for your future. For more information on the property market, explore our News and Insights page, or fill out the form below.