February Market Update

Since launching the company just 6 weeks ago, lots of commentary on the property market has been published by the national and local press. We felt it important to report on how we are finding the early 2023 market from the inside and with ‘on the ground’ experience, writes Tom Smith, Managing Director at Smiths Property Experts.

There are mixed messages from the local and national press, and market commentators. Even our industry press notice board is full of changing rhetoric reporting market trends that we find hard to relate to.

I have worked in the East Midlands property market for well over a decade, and in that time, there have been many peaks and troughs in activity. One thing that has never changed is an overall positive trend in prices, driven in my opinion by the relative affordability of family homes here, and a continued demand for homes versus a lack of supply. Another theory for the past price growth is the migration of people from London and the home counties, but I feel the reality is that rapid population growth has meant that there is still a large gap to fill between the number of properties in the United Kingdom and the number of people that must be catered for.

Despite some negative press, the market has performed remarkably well and has been extremely resilient through January and the first half of February. It is true to say that the days of ‘frenzied bidding wars’ and ‘fighting’ for a property are behind us for now, but we have had a strong interest in almost every property that Smiths have listed for sale across a range of price points, and over half of our listings since the new year have a sale agreed.

Mortgage rates are now also down to under 4% from some lenders, a marked improvement on rates seen throughout the second half of 2022. More importantly, the threat of rates hitting 6-10% is also behind us, with forecasters now predicting bank rates to drop further and even back to pre-pandemic lows of 1-2% in the medium term. Of course, this is a hugely positive forecast for any of us needing mortgages.

We are finding that the key to success for sellers and home movers in the current market is to be realistic and think commercially. As an agent, we are using a proven blend of marketing skills and channels with the aim of building a ‘buzz’ around a client’s home, and really engaging and having an intelligent conversation with potential purchasers on an in-depth level to give them the confidence needed to proceed.

I also advise sellers to think commercially. A percentage of available property across the region is priced over-enthusiastically after the boom of last summer. If you are buying onwards don’t be afraid to negotiate hard; whilst the ‘mini boom’ may be over, we are achieving prices in line with that of January 2022.

The long-term prognosis for the market is for continued growth as mortgage rates settle, mainly due in my opinion to the housing shortage affecting our population. Confidence is once again returning to the market and whilst purchasers undoubtedly have the upper hand if a property is not marketed accurately, serious sellers are achieving higher values for their property than at any time in recorded history when an exception is made for January through to September 2022.