Housing demand in Nottingham remains 'very strong' despite a 'crazy' year and the cost of living crisis, according to estate agents. Amidst rising mortgage rates and warnings of a recession it has been feared that house prices could drop significantly going into 2023.
Despite families being squeezed by inflation and the Bank of England increasing interest rates by 0.5 per cent to 3.5 per cent, estate agents said demand for homes and rental properties had not noticeably dropped, as they explained what they expected next year.
Phil McGrath, the owner of Smooth Moves Estate Agents in Mapperley, said: "It has been a crazy year. To be honest there is still a lot of demand and there's a lot of people in the rental market, so if we put anything on the market we get a huge amount of demand for anything at any price.
Read more: House prices could plummet in parts of Nottingham as market predicted to be 'cooling'
"Even though some landlords have put rents up because their mortgages have gone up, it has still not affected demand. In terms of selling properties, they're still selling and we have not seen too much of a drop in price - which you would expect when mortgages go up.
"We haven't really seen a massive change in that, again the demand is still there. When the spring comes, that will naturally create more demand for people to sell their homes as well.
"We're just carrying on in a way, it might be a long-term thing that people look at the mortgage rates and delay moving, but people are still putting houses on the market. The rental market is getting a bit unmanageable for some people, but generally the demand in the professional market is still there, we have properties that were £800 and are now more than £1,000, but as soon as it's on the market it goes straight away."
Adam Horton, founder of Adam Hortons on Park Row, said: "Mortgage rates have impacted buyer demand, but we’re yet to see this have a noticeable effect on selling prices.
"However, we are advising clients to be more cautious with their asking prices when they put their property on the market, it’s important to price competitively in order to attract interest from buyers. The rental market remains very strong, but prices seem broadly stable - it does vary a bit depending on the size and location of the property though."
Real estate company Savills in November said they expected property values to fall by 10 percent in 2023. However, they added house prices would start to recover from 2024 as interest rates and affordability pressures ease, meaning the average house price would be more than £22,000 higher in five years’ time.
Richard Cardwell, senior valuer at Walton and Allen, warned against trusting predictions on the housing market. "The predictions never really come true in the housing market in my experience. Pre-Rightmove in the 90s you used to get two predictions every year from Halifax, the biggest mortgage lender, and from Nationwide, the biggest building society, and the one thing I used to say to people is what they predict will not happen," Mr Cardwell said.
"A lot of different people predict what will happen now, but you look at them and it is not what I am seeing. It is all about mortgage lending, which is what people do not seem to get, there are not enough properties for sale and there is still a high demand.
"Are the banks still lending - yes. The rate is not that high, it is just a readjustment and actually when everything calms down, which it inevitably will, you'll be able to get a between 4 per cent or 6 per cent mortgage.
"What has changed is that now people have gone 'wait a minute' after looking at the news and being told the market is going to crash. Before if I put up a house I would expect interest straight away, putting fighting over it, and it going for the top end of the price.
"Now people are saying 'they were overpriced before and now I can offer a bit lower', but even now if the price is right the phones go off the hook. The demand from investors into Nottingham is still very high and we have a massive student population which squeezes the local accommodation."
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