Podcast Summary
UK property market growth in 2021 and falling house prices: UK property market grew by around 2% in 2021, but house prices have been falling for four consecutive months with a small decline compared to previous years' growth. Stay informed about market updates for future investment decisions.
The UK property market saw modest growth of around 2% in 2021, following a cancelled out boom and fall in the second half of the year. House prices have been falling for four consecutive months according to Halifax, but the magnitude of this decline is relatively small compared to the significant growth seen in previous years. Despite this, it's important to note that choosing a 12-month calendar period for comparisons can be misleading, as the property market in 2022 was characterized by two distinct halves. Moving forward, it's crucial for investors to stay informed about the latest market updates, including price trends and economic factors. Sign up for the Property Pulse newsletter at propertyhub.net/pulse to receive the most important news stories in less than 5 minutes a week.
Early signs of sales improvement despite falling house prices: Despite negative media reports on falling house prices, sales are picking up, leading to potential optimism in the new year. The government's support for homeowners in arrears and supply issues also impact the market.
Despite the negative news about falling house prices and the potential for continued media reporting on this trend, early signs from developers indicate that sales are starting to pick up. However, the data on house prices will lag behind this improvement, leading to a potential clash between negative media sentiment and new year optimism. A supportive factor for the market is the government's agreement with major lenders to show forbearance for homeowners in arrears, preventing a repeat of mass repossessions seen during the 2008 financial crisis. Another factor shaping the market is the issue of supply, which has been in the news recently. Overall, our predictions for the market's growth around 2% will be discussed in more detail in the next episode.
Decreasing supply and potential interest rate decreases could boost real estate prices: The 46% decrease in 2023 property supply and potential interest rate decreases could lead to higher real estate prices, as indicated by unexpected UK GDP growth in November.
The combination of decreasing supply and potential interest rate decreases could lead to higher real estate prices. The supply of properties coming to market in 2023 is currently 46% lower than the end of 2022, contributing to a decline in available inventory. Additionally, the Federal Reserve's recent indications of potentially decreasing interest rates as US inflation slows could further support higher prices. The UK's GDP also showed unexpected growth of 0.1% in November, defying predictions of a 0.2% decline, suggesting the economy may not be as weak as some had anticipated. Despite some negative media coverage, this unexpected growth can be seen as a positive sign for the economy and potentially for real estate prices. However, it's important to note that economic conditions are complex and subject to change, and other factors such as inflation and geopolitical events could still impact the market.
Positive signs in the housing market despite economic uncertainty: Mortgage rates dropping, rental markets growing, and innovative solutions making property investment accessible
Despite the ongoing economic uncertainty, there are positive signs in the housing market. Mortgage rates are dropping, making it a good time for those considering buying property. Meanwhile, rental markets in London and across the UK continue to see growth, with demand significantly outpacing supply. These trends are expected to continue, making property investment an attractive option for many. Additionally, innovative solutions like Portfolio's mobile app are making it easier for individuals to access the potential benefits of property investment. Overall, while economic conditions may be challenging in some areas, the housing market is showing resilience and offering opportunities for those looking to invest.
Growth in rental market due to population increase and high demand: Despite potential yield increases, rental market growth can be impacted by property prices and government policies. Scotland's recent tax increase may attract more rental stock, but its impact on finances is minimal.
The rental market is experiencing growth due to population increase and high demand for properties, leading to a potential increase in yields for landlords. However, this growth may not be consistent, as factors like property prices and government policies can impact the market significantly. For instance, in Scotland, where the government is making it less attractive for landlords to operate, yields may improve but demand for rental properties remains high. The Scottish government's recent increase in land and buildings transaction tax for landlords and second homeowners is expected to generate £34,000,000 in revenue, but it may not make a significant difference in the national finances. Instead, it may be a signal to attract more rental stock to the market, which is currently in short supply. Overall, the rental market is complex and influenced by various factors, and landlords need to stay informed about government policies and market trends to make informed decisions.
Scottish government decisions may negatively impact private landlords: Scottish gov decisions could reduce rental properties, leading to increased yields for existing owners, while MTD for income tax self-assessment is postponed until 2026 for landlords earning over £50,000.
The Scottish government's recent decisions, including a potential extension of the rent freeze and the purchase of distressed assets, could negatively impact private landlords and potentially reduce the availability of rental properties. This could lead to increased yields for existing property owners in Scotland. Additionally, the implementation of Making Tax Digital for income tax self-assessment has been postponed until 2026 and will only apply to landlords earning over £50,000 from their portfolios initially. It's important for landlords, especially those in Scotland, to stay informed about these developments and sign up for regular updates to stay ahead of the curve.
UK town with highest house price growth in 2022: Eastwood in Nottinghamshire saw a 29% increase in house prices, making it a potential investment hotspot.
Eastwood in Nottinghamshire was the UK town with the highest house price growth in 2022, with a remarkable increase of 29%. This town, located between the hotspot areas of Derby and Nottingham, as identified by the speaker, experienced exceptional growth and could be worth considering for investment. Additionally, the speaker recommended watching daily motivational videos by David Goggins, an ultra-endurance athlete and author, to help drive personal growth beyond property investment. The speaker previously praised Goggins' book "Can't Hurt Me" and his new release "Never Finished: Unshackle Your Mind and Win the War Within."
Check out David Goggins' works for inspiration: The speaker recommends drawing inspiration from David Goggins' no-excuses attitude and shares upcoming market predictions based on solid evidence in their podcast.
The speaker highly recommends checking out the works of David Goggins, particularly his first book and a related podcast episode titled "6 Lessons from a Hard Mofo." Goggins' no-excuses attitude resonates with the speaker, who uses his inspiration to overcome self-imposed obstacles. Additionally, the speaker and his team will be discussing their unique market predictions for the upcoming year in the next episode of their property podcast. They base these predictions on compelling evidence, not just optimism or a need to be contrarian. Listeners are encouraged to join them and follow the podcast on iTunes and Spotify to stay informed.