As we recover from the bubbling cauldrons of Halloween and the raging inferno’s of Bonfire Night, the temperatures have started to drop and, over the last month or so, the Burton Town centre property market has lost some of the momentum that was seen in the first half of the year. Prices rose by just 0.5% to leave annual price growth at 4.5%, on average, in the town centre (compared to nearer 5.5% for the neighbouring villages).It was interesting to see The Nationwide Building Society House Price Index showed its first monthly price fall for 18 months in September 2014 and three-month on three month price growth fell by more than half the levels seen in March 2014.
So, what factors have caused this change? It could be down to an increase in supply. Looking at the Burton and immediate surrounding villages, during the first 3 months of 2014, on average 131 properties were coming on to the market each month and for anyone potentially looking for a new
property had, on average, 673 properties to choose from.
In September, there were sixth more properties for a buyer to choose from (781 to be exact) and the number of new properties coming onto the market also increased to 183 per month. Greater supply with tempered demand has eased the market and this can be seen as good news as we would not want a repeat of the overheating in the mid 2000’s where property values in Burton were increasing by over 20% a year between 2001 and 2004. Other factors that are driving the town centre market slowdown – namely the emerging impact of mortgage regulation and threat of interest rate rises are having an influence on buyer (mainly landlord) sentiment. When it comes to mortgages and
finance, people are certainly a lot more cautious than they used to be!
However, the some of the surrounding market villages of Burton have benefitted from a delayed ripple effect from the South and saw their strongest quarterly price growth for four and half years.
It now seems certain that the spectre of interest rate rises and the uncertainty around the General Election will suppress the short term potential for further price growth in Burton as a whole, but, considering we have a couple of years of decent growth, great demand for rental properties with little or no voids on most properties, this easing could be a blessing is disguise, as I don’t know about you, I wouldn’t want to see a repeat of the boom and bust property market of the last decade.
I will always give all landlords my unbiased opinion on what to buy and not buy. I pride myself by knowing the market with all its ups and downs, so I can give some great advice and opinion. It might not be what you want to hear but, I can assure you, it is what you need to hear!
If you would like to discuss my thoughts on the rental market, feel free to pop through the door of our offices on the High Street, call me on 07973 666229 or send me an email to: davidm@professionalproperties.co.uk
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