Your Watford & Hertfordshire market report

The housing market continues on a similar path to last month as it eases its way back to life. With the cost of living crisis abating and disposable income expected to rise by 3.5% this year, consumer confidence has reached its highest level for two years (source: GFk), sales volumes are up 13%, demand is up by 8% and the difference between asking and sold prices is shrinking (source: Rolstons Dealbook and Rightmove).

Paul Gillespie, Managing Director, Rolstons, says:

"Underlying demand is positive, as a growing number of people buy homes, demonstrated by recent rises in mortgage approvals across the industry and underpinned by a strong labour market. And with rental costs rising at record rates, home ownership continues to be an attractive option for those who can make the sums work."

Although mortgage rates have fallen, they are still relatively high. When combined with a 20% increase in the supply of homes for sale, competition between sellers rises, and the market remains highly price-sensitive. It means sales are taking longer, too, with the average home taking 71 days to find a buyer. Most experts expect these same conditions to continue for some time, with activity rising but prices remaining relatively static. Prices are only likely to start growing when there is a downward shift in the base rate. And according to the latest from the money markets, that may only happen in late autumn, and any reductions after that are likely to be limited.

Rightmove's latest data shows asking prices increased by 1.5%, but Nationwide (-0.2%) and Halifax (-1.0%) reported falls. Rightmove's figures are the most up-to-date, based on current asking prices rather than sold ones, which are several months behind. It is, therefore, likely that Rightmove is just reflecting the growing sense of optimism amongst sellers. All three have annual price growth in positive territory.

Not all purchases are mortgage dependent, though, with around a third of property bought with cash. Cash purchases tend to happen towards the upper end of the market, so it is no surprise that top-of-the-ladder sales volumes are 18% higher than last year, with some of the most significant increases in London.

Rental & Buy To Let Market

After a quiet few months, rents were back on the rise in March, the average up by 0.9% to £1,273 per month. Annually, rents were up by 7.5%, below the 9.8% of March 2023. In London, rents were up by as much as 1.5% after recent falls. Even though London's rise was considerably higher than the rest of the country, on an annual basis, the capital is still some way behind with its 6.2% growth. And that's a significant fall from last year, when London's rents had risen by 11.8% (source: Homelet's Rental Index).

If you'd like to talk to an agent for more personalised advice, our team are always on hand to help. We'd love to hear from you, whether just a quick chat or a no-obligation property valuation.

Warm wishes,

The team at Rolstons.