Will property prices continue to rise?
Hogan’s, in common with estate agents up and down the country, have seen property prices rise in Leeds, in line with the price of everything else. But will this continue?
The short answer, according to Stephen our Director, is probably not.
The past few years, you see have seen an unusual combination of circumstances, caused by the C word: coronavirus / Covid 19.
This global pandemic brought many things about. Firms were forced to put staff on furlough, working from home became mainstream, and mortgage interest rates remained low. Don’t get us wrong – we know lenders remained stringent about borrowing, but if you could muster a good deposit, mortgage repayments were enticingly low.
A perfect property storm ensued.
Perhaps, the one biggest factor in property price acceleration was supply and demand. We all know, with toilet rolls and petrol, if demand is higher than supply, prices rise. Same with houses.
Many people working from home, perched on a kitchen table with a laptop, realised space was a problem. Families with kids who were left with kids at home on Zoom lessons soon felt property claustrophobia. Understandable really.
What this meant is that properties that are slower to sell – homes with 4 or 5 bedrooms – were snapped up. 2 and 3 bedroom homes for those with one child, or living as a couple, were in demand too.
You see, people suddenly wanted a home office, or a dedicated workspace. A space for desk and chair, a computer. Somewhere separate from the living space, away from distractions to create a distinction between work and home, so to speak.
Office furniture and garden room companies reported record profits during the pandemic. Computer giants like Apple, Samsung and Microsoft, reported shortages of hardware of laptops and tablets, due to chip shortages and huge demand.
Something even more unusual happened too – used car prices rose. We all know that a car depreciates as soon as you buy it. But you, no doubt, may have sold a car for a profit, which was previously unthinkable.
Same with new properties. Demanded exceeded supply on many new build developments so those already built and lived in carried a price premium. We know of one area, where a brand new 5 bedroomed home commands a price of £355,000 but the same house style, 3 years old and lived in, sells for £395,000, because it is ready to move into.
Strange times indeed.
As we indicated though, we don’t think these increases are sustainable. Already car price growth has slowed down and perhaps, with the rising costs of petrol and diesel, this demand will slow price rises down further.
If you’re curious though to know the current value of your home in Leeds or West Yorkshire, contact our friendly team at Hogan’s – email is always best: enquiries@hogans.co will get you a prompt reply.
