Cotswold Market Update from Tom Hayman-Joyce – December 2023:

The news is awash with statistics of house prices falling, reported from the various indices. I caution that one should not be overly concerned by the reports and review with a degree of perspective. The most accurate index is the Land Registry because it includes every transaction, unlike indices produced by banks, Nationwide or Halifax for example, which exclude cash purchases. Its data does lag behind the market however its latest data in August 2023 shows a 0.8% yearly increase in values – over the last year to eighteen months it is generally showing price stability.   

Considering the potential impact of increasing interest rates, one must take into account the number of people it is impacting. Only 20% of mortgages are a variable rate and the majority of these are held by individuals with the financial means to weather rate increases. Out of the working population of 32 million, only 3.2% had to remortgage at higher rates in 2023 and an additional 3% will in 2024. With similar levels of people being impacted this year as last year, it is unlikely to have an overly negative impact on the market as a whole.

We are finding those who are being affected by the higher interest rates are either extending the term of their mortgage, reducing their budgets to buy a smaller home or making a lesser “jump” up the ladder.

Demand remains for properties in the Cotswolds – there are more cash buyers than in many other parts of the country. Demographically we have a high proportion of retirees who generally buy without borrowing and are seeing their income rise with the increasing interest rates on their savings. We continue to see demand from buyers from London and overseas, interestingly with a recent increase from American buyers.  

Taking a balanced view, I see prices remaining stable or slightly improving in 2024. For an update on the value of your home or investment please call 01608 651188 or book a valuation via our website.