In light of the latest data from the land registry, the average property price in the Gravesham local authority currently stands at £339,726 compared to the UK average of £287,782.
This reflects an increase of £6,464 on the previous 12 months for Gravesham compared to a decrease of £3,934 from the peak of £291,716 in September 2022 for the UK as a whole.
There has been a notable rebound in prices across Gravesham following five months of price drops in a row between April and August 2023 as the hangover from the mini-budget and increased interest rates hit buyer demand.
For those hesitating to enter the Gravesham property market until it reaches a perceived bottom, the data suggests that the opportunity may already be passing. Despite the lingering impact of last year's mini-budget, which led to rising interest rates and diminished buyer demand, there are three compelling reasons to embrace optimism in the present and look ahead to 2024:
1. Mortgage rates have steadily declined over the past five months.
2. The base rate has been paused twice after fourteen consecutive increases.
3. Inflation has seen a six-month consecutive drop, reaching its lowest point since the autumn of 2021.
Following the latest decline in inflation, swap rates, a key pricing mechanism for fixed-rate mortgages, have also fallen.
Both five-year and two-year rates have experienced a decrease of around 0.2%, with lenders introducing attractive fixed mortgage rates and last week Lender Generation Home introduced the first sub 4% fixed mortgage rate since Liz Truss’s government.
Barclays, for example, has announced significant reductions across its fixed residential and buy-to-let range by as much as 0.43%.
This positive trend is reinforced by predictions that base rates and interest rates will continue to decrease steadily over the next few years, presenting a stable environment for prospective homebuyers.
This newfound stability has instilled confidence in first-time buyers and those seeking larger homes. The return of those looking to upsize indicates a belief that the market correction is largely behind us, and individuals are moving forward with their property plans in anticipation of a more normal interest rate environment.
Data from Nationwide for 2023 highlights a preference for smaller, more affordable properties, with flat transactions holding up comparatively well.
This preference for smaller properties contrasts with the trend observed during the pandemic period when the demand for outside space surged due to lockdown restrictions. Flats, being inherently more compact and urban-centric, did not experience the same level of increase in demand as other property types. Because of this, flats did not increase in value as much during the pandemic period and are being seen as better value for money with cost-conscious buyers.
As you can see from the above chart, the price of houses across Gravesham rose significantly more than flats in a similar trend to the rest of the UK. Cash buyers, alongside first-time buyers, have consistently dominated the market, leveraging their strong equity. In 2023, 25% of all purchases in Gravesham were with cash compared to 20.37% between 2012 and 2022, highlighting the strength of equity in the area. This resilience has contributed to the property market's performance exceeding expectations, even in the face of higher interest rates.
While some may still be holding out for significant price and interest rate drops in 2024, the resilience displayed throughout 2023 suggests a robust Gravesham property market.
In conclusion, the outlook for 2024 appears stable and relatively positive, with decreasing inflation and mortgage rates.
The continued strength of first-time buyers and cash buyers, along with the return of upsizers, signals a return to stability in the market. As we navigate a more balanced landscape compared to the tumultuous Covid years, the timing may be opportune for those across Gravesham considering a move in 2024.
Forecasts indicate that this year could present a favourable window before a new cycle begins in 2025, potentially driving property prices upward once again.
If the timing aligns with your plans, now might be an excellent opportunity to make a move and take advantage of the current market conditions. Don't hesitate to reach out for more personalised insights on the Gravesham property market and what this could mean for your future plans.
Thank you for reading.