According to the Land
Registry's latest House Price Index for Mid Sussex, the value of apartments/flats
are rising at a faster rate than terraced/town houses, semi-detached properties
and even detached property.
Values of apartments in Mid
Sussex have increased by 8.45% over the past year, which is proportionally 12%
more than the Mid Sussex average rise of 7.52%. The last time flats/apartments
in Mid Sussex out performed all the other types of property, by such a gulf,
was back in the summer of 2003. For comparison, the other property types performed
as follows;
- · Detached homes rose by 7.37%
- · Semi-detached homes rose by 7.24%
- · Terraced/Town-Houses rose by 7.04%
This moderately increasing
rate of property value growth is opportune – but no one should confuse it with
a strong and vigorous healthy Mid Sussex property market. Instead, it is
somewhat an indicator of the long-lasting lack of property on the market. In
fact, I have spoken about the lack of homes for sale in Mid Sussex on a number
of occasions in my Mid Sussex Property Blog and whilst it isn’t as bad as it
was 12 months ago – choice is quite limited for buyers.
The average property value in Mid Sussex
now stands at £372,700.
When split down into
property types;
- · Mid Sussex Apartments at £260,200
- · Mid Sussex Detached at £518,300
- · Mid Sussex Semi-Detached at £347,700
- · Mid Sussex Terraced/Town-House at £282,100.
So why have Mid Sussex apartments
performed so well, and is it just a Mid Sussex thing? When I scrutinised the
figures for the rest of the UK, it appears that apartments are pacemakers in
the clear majority of the country. Of the 379 local authority areas in the UK,
the value of apartments is rising faster than detached, semi-detached and
terraced houses in 320 of them.
So, should Mid Sussex
apartment owners be getting out the Champagne? Well, I would keep it on ice as
the Land Registry figures are notorious for short term fluctuations. It’s hard
to have faith in the fact that Mid Sussex house values rose rapidly last month
given that, in the last six months, the Land Registry has frequently made
downward revisions to their first published House Price Index figures.
Thankfully, the bigger picture
from the Council of Mortgage Lenders (CML) stated that home buying activity last
month was up 2% over the same month in 2016 – not bad as we have had the
Autumn, Winter and now Spring since Brexit. The CML stated first time buyer’s levels
of affordability was being squeezed and that the average amount borrowed by those
first-time buyers dropped slightly last month, but the overall amount borrowed
(by all buyers) was an impressive 12% higher than the same month in 2016.
So, what next for the Mid
Sussex Property market? I believe the uplift in the values of apartments is a
short-term blip. The real issue is with the way wage growth might not keep up
with inflation as the effects of 2016 exchange rate sucks in inflation (meaning
real wage growth stagnates). This will mean buyer demand growth will be
curtailed and with property values already so full, I believe a renewed hastening
in house price growth is unlikely.