22nd September 2023
As leading Property Search Agents in Surrey, we are often asked what’s happening with the property market in Surrey and whether now is a good time to start looking for a new home. We’ve put together a brief update on the Surrey property market and house prices in Surrey for anyone considering buying a property in Surrey over the coming months.
What has happened to house prices in the UK?
Since the Surrey HomeSearch May Property Update, we’ve seen a continued correction in house prices across the UK with Nationwide HPI figures reporting house prices in August 2023 at 5.3% below their August 2022 peak.
Given the rise in borrowing costs over the last few months and the increase in the cost of living, this continued correction is not really surprising. According to Nationwide’s Chief Economist, Robert Gardner, mortgage approvals have been “around 20% below the 2019 average in recent months and mortgage application data suggests the weakness has been maintained more recently”.
This lower level of mortgage approvals and economic uncertainty led to an almost unprecedented increase in the number of sales that fell through in early 2023. According to QuickMoveNow in the first quarter of 2023, a staggering 55.8% of agreed purchases fell through before completion - this has largely been attributed to buyers pulling out before purchase. This level is now back at around 25%.
What has happened to house prices in Surrey?
Property prices in Surrey have followed the national trend fairly closely, with house prices falling in eight of the 11 borough/districts (with the largest dips being seen in Elmbridge and Waverley). But don’t be fooled! Although properties are not flying off the market quite as quickly as they were last year, there is still a higher demand for properties than supply, meaning there are still plenty of buyers out there and that houses are still selling. Over 2023 we have seen a slight correction in the market value as estate agents adjust guide prices ever so slightly to respond to the cooler market, but generally houses are still selling quickly if they are priced correctly.
Will house prices fall in Surrey?
Savills Research forecasts that property prices in the prime regional markets will fall by 6.5% on average by the end of 2023, leaving values where they were in mid-2021 - meaning that we may still be in for further falls in the final quarter of 2023.
Economic forecasts predict that this might change in 2024 however. Despite continued domestic political instability and an imminent general election which will likely temper growth at the beginning of 2024, many property experts predict that by the second quarter of 2024 we’ll experience lower inflation and a stronger GDP - meaning that we’ll see more stability in the market or even a slight increase in house prices.
Should I buy a property now in Surrey or wait?
As always, this really depends on your motivation for moving, your current position on the property ladder and how long you plan to be in your next property.
For those homeowners looking to up-size, down-size or simply find a property that better suits their family’s needs if you are buying and selling at the same time, any further fall in property prices will affect your house sale as well as your purchase - so the effect really will be minimal unless you are planning a massive upsize. If you are buying your "forever home" (or at least plan on staying in your new home for a number of years), you are likely to be able to ride through any short-term price fluctuations - living in your property long past this slightly unsettled period in the property market.
Strong position for Cash buyers
The recent price falls and predicted future growth is probably most significant for cash buyers looking to invest in/purchase a property in the UK. As a cash buyer with nothing to sell, now might be a good time to start looking for your new property.
For anyone looking to find their perfect home in Surrey, Helen and Catherine at Surrey HomeSearch are always happy to have a chat about how we can assit you with your Surrey proprty search.