While the prime market was less exposed to disruption in the mortgage market than the UK housing market, it was not immune. Alongside the subdued summer weather, the market has had to ride the economic rollercoaster of falling house prices, higher mortgage rates and increased inflation. We caught up with our Head of National Country Agency Team, Matthew Allen, for an update on what has been happening in the country house and farms market over recent months and look ahead to the autumn market.
Matthew said: ”The summer has seen some mixed messages across the overall property market. According to HMRC, transactions for July were at 86,500 up 0.8% on the previous month but Zoopla predicts that 2023 is on track to have a 1/5th lower house sales compared to 2022 with around 1 million sales predicted this year. This has helped keep prices up for the most part despite the rising interest rates.
“We have also recently seen a softening of the mortgage market with base rates expected to peak shortly with some 5-year fixed rate deals now around 5% compared to 6.5% earlier in the summer. However, cash buyers remain strong in the marketplace with the number of cash purchases expected to only be 1% less than in 2022. It is expected to be down 28% for mortgage-related purchases.
“The prime markets are also faring better with continued growth standing at +5% across the whole country with prices still up 31% compared to 2019. We have certainly seen some strong sales agreed over the recent months with a good number of high-value new instructions to test the autumn market being launched at present.
“In the farmland market values are at an average 5-year high with average arable prices now approaching £11,000 per acre. However, there have been wide regional variations and each holding, farm, or estate is assessed on its own merits. The continued delay in the roll out of SFI (Sustainable Farming Incentive) will only lead to more frustration amongst farmers who are looking to replace income lost following the removal of the Basic Payment Scheme (BPS). This is leading to some farmers looking at all of their options which may give a greater level of supply of land and farms to the market in the coming months.
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