Residential Property Market Review – September 2022

Strong monthly transactions but slowing activity ahead 

Latest data from the UK housing market presents a mixed picture, with dwindling demand and limited supply contrasting markedly with strong transaction figures. 

Homebuyer demand remains above average, Zoopla pointed out. Yet analysts expect demand to weaken in coming months as more households feel the cost-of-living squeeze, a prediction supported by the latest Royal Institution of Chartered Surveyors (RICS) survey, which showed new buyer enquiries still in negative territory. The RICS survey also noted that new instructions to sell homes remained largely flat, which is keeping supply limited. 

Completed transactions, in contrast, remained strong in July, 6% above the 2018-19 average for the month, according to HM Revenue and Customs. Despite this, there are already signs of slowing activity ahead, with mortgage approvals 9% below the 2018-19 average for the month, according to the Bank of England. 

Help to Buy ends 

First-time buyers (FTBs) have only a month left to take advantage of the Help to Buy: Equity Loan scheme, which will stop accepting new applications at the end of October 2022. 

The government’s flagship initiative, which was always intended to be temporary, will close completely in March 2023. First launched in 2013, it has so far helped at least 350,000 FTBs onto the property ladder. 

Help to Buy enables FTBs to purchase a new build property with just a 5% deposit. When the initiative wraps up, however, there will still be several government schemes offering help to FTBs and other buyers. Those with only a 5% deposit will be able to use the mortgage guarantee scheme to borrow the other 95%. 

Shared Ownership, meanwhile, allows people to buy a share in a property and pay rent on the rest. FTBs are also eligible to save into a Lifetime ISA, which adds a government bonus of 25% onto annual house deposit savings of up to £4,000. 

Greening homes “a monumental but essential task” 

Scotland’s first-ever Green Home Festival, organised by members of the Construction Industry Collective Voice (CICV) as part of the Edinburgh Festival Fringe, took place in August to raise awareness of the role of property in the transition to net zero. 

The week-long series of events delivered practical advice on topics ranging from using sustainable materials to protecting homes against floods. The festival aimed to engage individuals and businesses to reduce their carbon footprint and become more energy efficient. 

Patrick Harvie, Minister for Zero Carbon Buildings, Active Travel and Tenants’ Rights, was the keynote speaker. In his speech he said, “Our statutory target for 2030 means that we need to reduce emissions from heating buildings by 68% below their level in 2020. This is a monumental but essential task. Our building stock is relatively old and wasn’t always built to high energy standards. This legacy of poor energy efficiency has contributed to emissions and fuel poverty, so we need to start drastically improving that standard.” 

All details are correct at the time of writing (20 September 2022) 

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