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The Rise Of UK House Prices

Semi detached housing in a new build estate

According to data published by the Office of National Statistics (ONS) in March 2022, the average house prices in the UK have increased by 9.6%. This was on average £274,000 which is £24,000 higher than this time last year. According to Zoopla’s data, the typical UK home gained £16,000 in value in 2021, taking it up to nearly a quarter of a million pounds.

When separating the UK, the increase over the year in equates to England £292,000 (9.4%), Wales £206,000 (13.9%), Scotland £183,000 (10.8%) and Northern Ireland £159,000 (7.9%). Research produced by Savills concluded that this annual increase means that, effectively, ‘houses earned more than people’ last year. This is based on the 2021 Annual Survey of Hours and Earnings, that the average UK worker earned £25,971.

Housing Demands

House prices soared during the covid pandemic due to various reasons including stamp duty and the new mortgage guarantee. On 8th July 2020, changes to the tax paid on property purchases were announced. With the knowledge of less overall costs this could have led to sellers requesting higher prices on their properties. In terms of Stamp Duty Holiday, on the 3rd of March 2021, it was extended until 30th June 2021. After which the threshold decreased to £250,000 until 30 September 2021. Yet, tax breaks were originally due to conclude at the end of March 2021.

Buyers therefore rushed their property buying to ensure their purchase was within the deadlines. Thus potentially, affecting the prices within the market. Furthermore, there seemed to be a “race for space” concept. Whereby buyers, surged to invest in larger properties with the new working from home guidelines. Whilst house prices could still stabilise in 2022, demand still remains high.

Will House Prices Drop In 2022?

Rightmove, have reported the number of prospective buyers enquiring about homes was up 15% on this time last year. However, the impact of inflation and the rise in interest rates could still prove to influence the market.

Ross Counsell, chartered surveyor and director at GoodMove, comments “I strongly believe that house prices will finally begin to fall this year. We know the cost of living is continually increasing, with energy prices especially going up in the next few months. With less buyer demand comes lower house prices, and with this in mind, we expect many Brits will have to tighten their belts financially and may not be looking to move home because they may not be able to afford it.”

Development Finance With BLG

BLG are a leading principal lending specialist in property development finance, we are positioned to help you. Providing residential and commercial finance ranging from £1 million to £15 million we have the ideal skill set to lend and advise. Priding ourselves on fast decisions and flexible terms we can aid you through these turbulent times. Contact our financial experts today who will take time to get to know you and your aims.

WHAT OUR CUSTOMERS SAY ABOUT US

"A challenging site like no other with every inch of the plot being built on and 12 apartments built-out through a driveway 2.5m wide off of a main high street with limited access rights, not to mention all the complexities associated with 13 Party Wall Agreements. Most lenders would not have had the vision for the scheme or the confidence in Spiller Builders to build out the scheme.  I just wanted to say how helpful the entire BLG team have been during the build. A very approachable and knowledgeable team, with a “can do” approach to lending. We will be looking to do more business with you for sure."

“We have used BLG for development finance for over 8 years. During that time we have found their knowledge and expertise in the property development industry to be second to none. Their loan process, pragmatic and flexible approach to lending and flexibility when required has supported our business needs throughout the period and provided us with support to deliver new homes in Bristol and the surrounding areas.”

“As property developers you never know the curve balls that you may get and a project that is great on paper may prove a bit more tricky.  This happened to us on a project that BLG have funded and throughout they have supported us.  Our business likes to be collaborative and when we hit those tough moments it really felt like we were working as a team with BLG.  If you have a decent project you can get it funded, but what you really need is a business that is there to support and advise you as well.  For us on this project it was BLG.”

“I approached BLG Development finance with an opportunity I had in Chesham, Buckinghamshire, to build 5 new build houses in 2021. My main contact was Anil Bains who is a Director covering Asset Management. Within very quick timescales, BLG provided me with indicative quotes in regards the finance levels they could offer me. Having considered those levels, I requested a valuation to be carried out which again was dealt with swiftly. We proceeded to completion. The build went very smoothly with monthly monitoring being carried out by BLG and monthly drawdown requests dealt with in a very timely manner. Due to a difficult time generally in the market in regards selling, I was in need of a six-month extension to the loan which again was appraised very quickly and granted. Having dealt with numerous funders over the last 20 years, I can only speak highly of my personal experience with BLG and would very confidently work with them again on any future projects. “

"From our side it has also been a pleasure working with BLG and the team there. We have found you easy to deal with, proactive in resolving any minor issues that have arisen through the project and shown great flexibility in working with us as a partner. We will certainly like to work with you on future partners."

“I really appreciate your hard work. We really like the way you communicate & I must say I haven't seen many people who are that approachable.”

“A very efficient processing team, dealing with the DD once deal credit approved, through to completion”

“Many thanks for your efforts on this one and getting it approved and sorted so swiftly, very much appreciated. I am sure I will be speaking to your over the coming months.”

“We had other funding options, but chose to use BLG again, as we work well with the team, who always provide very clear information and advice with a friendly approach throughout the funding process. Very efficient and always very helpful.”

“Many thanks Anil, it’s been a real pleasure working with BLG so far.  We’re lining up the next project too”

“We would recommend all staff we have dealt with at BLG, as we are very satisfied with the team and the initial offer/terms presented, then you and the funding team, through to the draw down team at valuation stage.”

“All documents are clear and the way you keep clients informed, all the way along the funding process, is refreshing for us”

“With regard to what should be improved at BLG, we work with many lenders in our business and we do not get the help and response we have had on the two projects with all at BLG on our funding for our developments.”

“We would particularly mention Dave Edwards and Tom Pitts as being central to having a smooth working relationship and being positive and helpful at all times. Their guidance in helping us navigate the project from inception to completion was invaluable. As was their patience, particularly at the beginning. We look forward to many future projects with the BLG team.”

“We would like to express our appreciation for your support on our development in Bristol. We were very pleased that, from the outset, you shared our vision of the project to convert a dated but classical building, that had outlived its usefulness as a school, into unique luxury apartments with views overlooking the city. We found our dealings practical and streamlined. Monthly payments were processed in an efficient and timely manner.”

“BLG are very good at communicating with clients and all documents are very clear and all at BLG are always happy to help.”

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