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Nationwide: house price growth hits 11.2% in January

ended 31. January 2022

“We were somewhere around Barstow, on the edge of the desert, when the drugs began to take hold.”

The drugs have certainly taken hold of the UK property market, as house prices went bananas in January.

They were like some dude charging at you on Angel Dust in the back streets of Detroit.

You're gonna need a .357 Magnum to put him on his arse. A 9mm just ain't gonna cut it.

Anyway, I digress.

Commenting on the figures, Robert Gardner, Nationwide's Chief Economist, said:

“Annual house price growth accelerated to 11.2% in January, the strongest pace since June last year, and the strongest start to the year for 17 years. Prices rose by 0.8% month-on-month, after taking account of seasonal effects, the sixth consecutive monthly increase."

Nobody quite understands what "after taking account of  seasonal effects" means, but hey. 

You'll find views from Newspagers in all their glory below, but here are my two favourite reactions.

You've got Scott Taylor-Barr over at Shropshire-based Carl Summers Financial Services, getting all clever with his geopolitical macroeconomics.

"Right now a lot of the potential buyers I speak to are deeply conflicted. They want to buy a home but they are reading a lot about rising interest rates, inflation at record highs, tax increases and soaring energy costs, and on top of that a potential Russian invasion of Ukraine.  It's not surprising that people are approaching a big ticket purchase like a house with a little less of a gung-ho attitude in the current fraught climate." 

And Kate Allen, owner at Devon-based luxury holiday lettings specialist, Salcombe Finest, puts in with her usual panache:

"Just like a bottle of Cockburn’s 1970 vintage port, the sheer lack of property will keep prices high. Whilst stock levels are as low as the Prime Minister's popularity, property prices are going to remain buoyant here throughout 2022. Even as wage growth slows this year as the cost of living crisis hits, it won’t stop deep-pocketed investors from quaffing Devon properties."

 

11 responses from the Newspage community

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Lewis Shaw
Owner and Mortgage Expert at Shaw Financial Services
"January was a busy month with lots of activity from first-time buyers looking to take their first tentative steps onto the property ladder. Currently, everything is being constrained by staggeringly low property stock levels and I cannot stress how important it is to get prepared before you even think about looking to buy. With some properties having upwards of 20 offers within a day of hitting the market and many deals going to sealed bids the early bird catches the worm. Even with rates on the rise, the allure of homeownership is stronger than ever due to the relentless increase in the cost of renting. 2022 is set to be another bumper year, and even with the spectre of inflation haunting us, anyone thinking prices are going to come down any time soon will be sorely disappointed."
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Imran Hussain
Director at Harmony Financial Services
"January was a super busy month with first-time buyers looking to get onto the housing ladder and home movers looking to move up it. For now at least, there have been no signs of a slowdown in demand during 2022. Demand is stronger than ever before and even though inflation and rising interest rates are in the mind of many first-time buyers, the dread of extortionate rental prices is driving them onwards. There are on average 20 buyers for each property so anyone expecting property prices to drop dramatically is in for a shock. Even if the economy goes Pete Tong, the sheer level of demand for property will keep property prices stable."
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Rhys Schofield
Brand Director at Peak Mortgages and Protection
"January was by far and away our busiest month ever, with demand for property and mortgages through the roof. The systemic lack of stock means house prices can only go one way. Until we build enough houses, which will never happen based on successive Governments' track records, prices will always trend upwards in the long run."
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Lee Griffiths
Senior Sales Manager at Picker Elliott Sales & Lettings
"The property market absolutely shot out of the gates in January. Prices have remained at record levels, partly thanks to the lack of housing stock, and there has been a marked increase in valuation enquiries. Demand has been as strong as ever, with most properties we list going under offer within a week. This often leaves numerous disappointed buyers still searching for their next home. Stock levels in the area do seem to be on the up, but there's still huge pent-up demand so the supply and demand issue remains. I do not believe we're going to see any kind of price drop in 2022, but I do believe that we're going to see the market begin to stabilise. As stock levels increase, and interest rates rise, I feel the pricing curve will flatten."
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Scott Taylor-Barr
Financial Adviser at Barnsdale Financial Management
"Right now a lot of the potential buyers I speak to are deeply conflicted. They want to buy a home but they are reading a lot about rising interest rates, inflation at record highs, tax increases and soaring energy costs, and on top of that a potential Russian invasion of Ukraine. It's not surprising that people are approaching a big ticket purchase like a house with a little less of a gung-ho attitude in the current fraught climate."
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Kate Allen
Owner at Finest Stays
"Just like a bottle of Cockburn’s 1970 vintage port, the sheer lack of it will keep property prices high. There has been a real shift in Salcombe, with purchasers buying purely for investment purposes, not because of a love of this stunning coastal location. Whilst stock levels are as low as the Prime Minister's popularity, property prices are going to remain buoyant here throughout 2022. Even as wage growth slows this year as the cost of living crisis hits, it won’t stop deep-pocketed investors from quaffing Devon properties."
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Rob Gill
Managing Director at Altura Mortgage Finance
"Demand for property remains strong due to lifestyles still changing as a result of the pandemic. Stock, however, remains ridiculously low, so house prices are likely to remain fairly buoyant despite the many challenges facing the economy."
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Graham Cox
Founder at Self-Employed Mortgage Hub
"Mortgage demand has picked up a little in the second half of January. But overall, we're noticing borrowers are turning cautious, fearful of the economic outlook. While there is a fundamental shortage of properties on the market, and housing supply generally, all the factors on the demand side are going in the wrong direction. National Insurance, energy bills, the cost of food, fuel and mortgages are all going up. There could be a rude awakening in 2022 for those who believe house prices can only ever go up."
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Rob Peters
Principal at Simple Fast Mortgage
"Although 2022 might see more sensible levels of property activity, it's going to take an interest rate tsunami to put house buyers off. Ultimately, people need houses, and as there aren't enough houses, demand will remain high, and property prices will continue to rise. The lifestyle movers out there might decide not to move, as they don't really need to anyway. First-time buyers, and those who have welcomed a lockdown baby into the household, will continue to hunt for new homes."
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Jamie Thompson
Mortgage Broker at Jamie Thompson Mortgages
"Around Manchester I'm seeing as many first-time buyers as there's ever been, but they're trying to buy as few properties as there seems to have ever been. This is probably because everyone above them on the ladder who might have been moving this year brought their moves forward to pre-September 2021 due to Rishi's super stamp-duty slash. The stamp duty holiday has now driven prices to a level sadly beyond many first-time buyers. Another Government plan gone wrong."
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Andrew Simmonds
Director at Parker's Estate Agents
 "While we have seen some quality properties come onto the market since Christmas, stock is still very limited and buyers are not yet coming out of their shells unless something really catches their fancy. 2022 seems like it will still provide consistent growth, with some areas faring better than others as ever, but it will be much more moderate growth than we have seen during the past twelve months due to rising interest rates, taxation and the increased cost of living. I am expecting to see many vendors sell and move to rented with a view to onward purchasing later in 2022 or 2023.”