State of Your Local Property Market: October 2023 - Estate & Lettings Agents - Worthing & Sussex

State of Your Local Property Market: October 2023

The current landscape

Matt Jacobs, Managing Director of Jacobs Steel, says,

“Whilst it remains a buyers’ market, many house hunters are still finding it hard to source the ideal property. This is reflected in our recent figures too; our level of viewings were up 5% in October vs September, although the level of new instructions were 5% less. The limited level of stock is arguably keeping prices stable and most people choose to market their own property when they see a property hit the market which interests them.

As expected, buyers are taking longer to make an offer than in the crazy market of low interest rates, this is often down to them taking longer to be in a proceedable position too.  The low to mid-level market (up to £500,000) is still competitive and this market is buoyant. The reality we face at the moment is that the higher end, (over £1 million in Worthing and in excess of £1.4m in Brighton and Hove) has been more impacted as this is where ‘up-sizers’ require bigger mortgages, and new rates don’t offer the same lending as before, hence prices are adjusting.  

There are more downsizers too, again partly due to higher interest rates and high utility bills, which has meant the choice of property at the higher end is vaster than in the 21/22 market”

Some more positive news to sprinkle over some of the harder truths- it has been a good month for completions and we are now in that time of year where buyers & solicitors are prioritising the pre Christmas move-ins!

The UK economy and housing market are still facing significant uncertainty. Although the interest rate held in September and October was promising news, there’s little relief for those seeking to re-mortgage or enter the housing market with leverage. Despite inflation remaining high, there is a silver lining as it’s moving in the right direction for businesses and households.

Mortgage rates

October brought good news when the Bank of England held rates for a second time at 5.25%. Mortgage and Protection Advisor Adam Dunbrill shared his take on the mortgage news from October.

“Inflation is still above target but it’s not rising, it’s merely being a bit stubborn by not falling as they hoped. This has given confidence to lenders who are noticing the cost of borrowing fall. These lenders are beginning to pass on these reductions to the customer, which in turn has led to a little pricing battle between lenders which is good news because this helps customers get lower monthly payments on their mortgages”.

In short, the repercussions of the Bank of England’s decision has created momentum that means we are now beginning to see lenders want to lend and are relaxing more post covid criteria to make it easier to get a mortgage.

Recently, the Financial Conduct Authority and mortgage lenders agreed on a ‘Mortgage Charter’ to help homeowners who are worried about rising interest rates. If you’re one of the 800,000 mortgage holders who will be transitioning away from fixed-rate agreements within the next year, there’s no need to panic about mortgage payments. You can contact your lender for help without affecting your credit score. Borrowers can secure a new deal up to six months before their fixed-rate deal ends and switch to a better deal before the new term starts. If needed, they can also switch back within six months of starting the new schedule.

On 23rd October 2023, it was announced that the Treasury is looking to extend the mortgage guarantee for another year to help those struggling to cope with increasing mortgage rates. This scheme was introduced in March 2021 by Rishi Sunak and was designed to help people looking to secure a mortgage with a 5% deposit. However, this is coming under increased criticism as the cost of living crisis and increased mortgage rates continues to hit households hard and reduces the number of people able to meet even this criteria. 

The chancellor will announce further information in the Autumn Statement on 22 November.

Keep your trusted estate agents and mortgage advisors close to support you on your journey and help secure you the best deal moving forwards.

As of Friday 10th November 2023, the current average mortgage rates are shown below:

Rental market review

We caught up with Lettings Manager Ollie to hear what’s been happening with the local rental market; here’s what he had to say:

“The rental market in October remained consistently strong with the majority of properties in our area letting quickly. Additionally, rental values continue to grow at a steady rate and demand remains high. 

Although demand is high, the rental market feels less chaotic than previous, with properties in most cases letting at the advertised price, rather than tenants offering higher to outbid competition. 

This would indicate that the rental market has settled and there is a consistent level of properties coming to market to cope better with the demand. 

Furthermore, this would also indicate that tenants are more conscious of individual finances and budgets with the current cost of living and are willing to wait longer than over-stretch themselves”.

As ever, choosing an experienced lettings firm to deal with your property is of paramount importance. The lettings team at Jacobs Steel are always happy to answer any questions you may have.

October also brought a news update for the rental market. On 2nd October 2023 a new ‘how to rent‘ guide was published, by the UK Government, for tenants and landlords in the private rented sector to help them understand their rights and responsibilities. It provides a checklist and more detailed information on each stage of the process. For all new tenancies or replacement tenancies (even if they roll over into statutory periodic tenancies), it’s crucial to provide the ‘how to rent’ guide. Failing to do so could render any Section 21 notice invalid.

Commercial market review

When it comes to the commercial property market, Commercial Manager, Leigh Doherty, knows his stuff. Here’s what he had to say:

“The commercial market has many facets, and each sector demonstrates its strengths and weaknesses. Currently, we are finding a big majority of valuations are for the sale of businesses, which post Covid, is unsurprising however, the good news is that we are finding a good number of potential purchasers who are willing to not only offer a premium but are also looking to take over these businesses. In addition, the busiest sector in commercial is currently the investment market. We have been providing advice to a number of different landlords recently who are looking to sell and although yields aren’t quite back to the level of a few years ago, this sector remains strong.

In respect of the retail market and despite public opinion, we are still finding good quality tenants who are looking right across Sussex. We all see an agent’s board when we walk along a retail parade but in the background, it’s more often than not that a deal is in negotiation with a new tenant which normally takes 8-12 weeks to complete.”

The road ahead

Despite the state of the wider economy, the housing market has proven to be more resilient than expected. Granted, estate agents across the board have observed a decline in sales, cautious buyers, and a slight dip in prices but there’s no reason to be overly pessimistic. It’s evident that anyone selling their property now requires the expertise of a skilled agent more than ever before since the pandemic. Sales are still happening, they just require a different approach. 

October brought some welcomed relief to the rental market, thanks to steady rental value increases and high demand, plus legislative updates. Overall, the rental market in our area continues to thrive and remains consistently a very active, fast paced market, but a more settled version than before. 

In terms of mortgages, things are looking up here too with confidence in the market growing and fuelling investment opportunities but all eyes are set to see what comes from the Autumn Statement on 22 November.

Jacobs Steel are estate and letting agents with offices in Worthing, Findon, Lancing, Shoreham-by-Sea and Hove. We will guide you through the entire process, communicating with you every step of the way.

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