According to Home.co.uk there are 20% more properties on the market today than there were 12 months ago, but the numbers of property sales are down by 20% or more. Such an increase in supply would suggest that prices should be falling. However, according to the latest UK Cities House Price Index from Hometrack, Cambridge house price growth in the past 12 months was just 2.2%, down from 12.2% the previous year.
So, after years of rising prices and tales of buyers being outbid on house after house, what is really happening to the Cambridge property market in 2017. Well as always, it depends what on the location, type and value of your property
Firstly, it must be said that the market was distorted last year. There was a surge of investors buying last Spring to beat the introduction of higher levels of Stamp Duty for second properties and this really helped to push up both prices and total number of sales. There has now been a readjustment.
Secondly, there is a major split in the market between traditional second-hand properties and new homes. Cambridge has seen unprecedented levels of house building over the past few years and this has led to an over-supply of very similar new houses and apartments on large developments. Typically, large developers release schemes in phases with prices changing based on demand. In a rising market this means higher prices at each stage. But this can only carry on for so long before buyers say enough is enough and now there is a definite slow-down in sales. The average time to sell a home in Cambridge has risen from 4.1 weeks in March 2016 to 7.5 weeks today. This change is driven by what is happening (or not) on large new developments.
The new homes market now makes up nearly 40% of the total number of properties on the market in Cambridge and is hiding a shortage of supply in the traditional market where houses and apartments are still selling really well. Nowhere is this truer than for pretty, Victorian houses, priced correctly in the Kite, close to the Station, in Newnham or in De Freville Avenue. These homes remain incredibly popular with buyers. We recently sold a two-bed terraced house in York Street where there were 17 viewers and seven offers with the final sale price substantially more than the original guide.
Even in the new homes market there are variations. Smaller developers selling interesting, high spec houses and apartments in good locations are still finding buyers happy to pay premium prices. Making sure these specialist developers have access to the right advice and sales expertise is exactly the reason we are welcoming Oliver Hughes to our team.
What of the future? The Sunday Times recently ranked Cambridge in its best 20 locations to live. Under the headline ‘Boom Town for the Brainy’, the newspaper said: “You can’t argue with this honey-coloured hotspot’s popularity. The population is soaring, thanks to great rail links and blossoming tech businesses”. Outside the city, The Halifax Quality of Life Survey 2016 recently placed South Cambridgeshire the sixth most desirable place to be a resident in the country. Cambridge and its surrounding villages remain a great place to buy. And, if you are thinking of moving in 2017, take a look behind the headline statistics to understand what really is and is not selling locally.