What does the future hold for the Welsh property market?
Wales is a great place to live. Mountains, beaches, open fields, rolling hills… it has it all. I’ve seen how the market has taken off since Covid, likely driven by people looking to escape the bustling city life in England. Here, Harry Hale, our surveyor in the South Wales region, along with Felicity Thomas, shares an overview of the market in Wales and what he expects to happen in the rest of 2022…
What does the property market look like in Wales?
Here in Wales, we’ve seen the same trends as across the rest of the UK. In short, house prices have been driven up by recent political events and the COVID pandemic. They’ve just hit their highest-ever levels, representing ever-increasing demand.
According to Nationwide, in Q1 2022, the average Welsh property value increased by a staggering 15.2% (on the previous 12 months). In Q2, the price rise was ‘only’ 13.4%. This represents a slight slowdown in the market compared to the first quarter, but it’s to be expected.
The Welsh property market is outperforming the rest of the UK. In fact, it was the fastest-growing region in the first quarter of this year. Q2 saw the South-West overtake it, but only just. Wales is clearly the place to be.
What might happen to the Welsh property market in the future?
We’re currently facing an unprecedented juncture of multiple property-affecting factors colliding head-on. The Ukraine War, the aftermath of coronavirus, Brexit and the subsequent cost-of-living crisis are playing havoc with the market. All these events are pretty unpredictable, making house-price changes challenging to estimate.
Throughout the rest of 2022, I’d expect growth to continue slowing. That’s based on what we’re going through at the moment. None of us is immune to the cost-of-living crisis. As bills and mortgages become more expensive, we all tend to make ‘safer’ decisions. This means less spending, leading to lower property demand and decreased market growth.
Having said that, I don’t expect prices to go down below what they were 12 months ago. The growth might slow, but Wales is a small, desirable country on an island. The need for somewhere to live in the limited space we have should keep things relatively steady.
Liz Truss’s new government may bring in or eliminate certain laws and taxes. These might impact the market in their own ways – let’s see! She’s told us that she’s willing to be the unpopular Prime Minister (both at home and abroad) if it means getting her job done. That should be a glimmer of hope in the long-term, but how it’ll affect homeowners in the meantime remains to be seen.
Is now a good time to move to Wales?
If you’re planning on living in Wales, I’d say that now is an excellent opportunity to seize a move to Wales. The way the house prices have shot up in the past few years represents the country’s desirability. It shows how desperate many people are to escape to this beautiful part of the world.
Although the demand will almost certainly wane over the coming months, prices aren’t likely to fall too much. Take advantage of the moment to negotiate a lower price. When the current crises are over, and the world resumes its new ‘normal’, expect your home’s value to shoot up once more.
Of course, ensure you can afford whatever property you look at and don’t overstretch. Provided you’re sensible and cautious, I couldn’t recommend a move to Wales enough.
However, if you’re looking to buy a second home or holiday property in Wales, it’s worth being aware of incoming new rules on how such properties are taxed. The Welsh Government has announced an increase to the maximum level of Council Tax premiums for second homes, as well as new local tax rules for holiday lets.
The maximum level at which local authorities can set council tax premiums on second homes and long-term empty properties will be increased to 300%. The new rules will come into force in April 2023.
Contact us at GB Home Surveys
Getting a home survey done before you move house is a critical step. It’s insurance against deal-breaker problems and can give you an accurate idea of any repairs or issues that may need to be addressed. When you instruct a surveyor, you should look out for several things. For example, do they know the local market well? Are they registered with RICS?
At GB Home Surveys’ South Wales office, Felicity and I know the region like the backs of our hands. If you’d like to learn more about the Welsh property market or RICS home surveys, feel free to contact us. You’ll find our details on the South Wales page of our website.
Thanks for reading through, and I hope to hear from you soon.
