Despite a mixed picture nationally, the housing market remained solid in Lincolnshire this summer thanks to many new ongoing developments in the city, as well as relatively low prices for first time buyers, who have been flocking to get onto the property ladder.
House prices in the East Midlands remain firmly positive, while London, parts of the wider South East, and to some extent, East Anglia are downbeat, according to the RICS residential market survey for August — yet house prices continue to increase firmly across Lincolnshire, Yorkshire and Humberside.
Agents in the East Midlands have sold the second most properties across England over the last three months, with only Wales selling more over the same period. However, newly agreed sales dropped 37% in August, which represents the most negative reading in three months across the wider region.
In Lincoln, the outlook of the property market remains very positive. “Amid the uncertainty surrounding Brexit, the Lincoln housing market continues to be very good,” said Simon Bentley, Senior Partner at Mundys estate agents. “It seems that everywhere you go in Lincoln there is a new development of some sort and we feel that Lincoln is continuing to buck the downward trend compared to many cities across the country. Activity levels continue to be high throughout the summer, with properties across all price brackets selling and we have also seen a return of first time buyers. We are convinced these positive figures are due to the increased investment coming into the city and the excellent value property offers in Lincoln.”
Lincoln has been named this week as the second most affordable area in the UK for first time buyers (FTB) according to research by the Post Office, so it’s no surprise agents have see an increase in trade in this area. With an average house price of £143,950 and an average FTB household income of £39,834, Lincoln is only beaten by Blackpool in affordability. Blackpool has an average house price of £112,000 and an FTB income of £39,611. The research also highlights that 100% of house prices in Lincoln are in areas affordable to FTBs. The most ‘affordable’ areas in Lincoln are Park, Abbey, Birchwood, Castle and Glebe wards.
According to the new research, the average FTB will spend four years saving towards their deposits and commit to saving almost 20% of their average joint household salary. Ross Hunter from Post Office Money said: “Some FTBs will prefer to take longer saving for a deposit rather than cut back on their monthly spending (23%), whereas others will be willing to compromise on the property itself (17%). Half of all FTBs (56%) will also turn to their family for financial assistance to help build their deposit.”
Landlords are also set to be able to increase their rents, as the RICS survey shows a further decline in fresh rental stock in August, a trend that has been emerging on the back of tax changes on buy-to-let properties, with tenant demand continuing to outpace supply. Rents are therefore expected to rise at a faster rate than house prices in the medium term, with average rental growth projections standing at around 3% per annum over the next five years whilst prices are projected to rise by around 2% on the same basis.
Simon Rubinsohn, RICS Chief Economist, commented: “While a combination of a lack of stock and some level of uncertainty, both relating to the interest rate outlook and Brexit, has had an impact on activity, the overall picture in these areas is still encouraging. The story in London and the South East is, as has been widely recognised, rather more challenging but it is important that this is not seen as being indicative of the wider market.”
Also read our previous Business Week features
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