A Need for Space
The average house price in Newcastle in September, during the traditionally buoyant September market, was £171,000, up 2% on September 2019. This annual increase, combined with the robust recovery of values in the wake of lockdown restrictions being lifted, is indicative of buyer demand.
The number of sales has been more acutely impacted by the Covid-19 pandemic. In the Spring, the supply of homes coming to the market dropped to near zero before rebounding to above 2019 levels through the Summer and Autumn markets. However, the total number of properties that have been brought to the market in Newcastle over the year to October remains -3% down on the same period in 2019. This reduction in supply and effective closure of the Spring market meant that, in the first half of 2020, recorded sales were down around -30% year-on-year. While activity in Q3 is likely to narrow this annual shortfall, it appears that 2020 will still see a reduction in the level of sales for the year as a whole.
Also of note is the split in demand across the market. High quality family houses have been attracting the most attention, while smaller apartments have seen less demand as households have re-evaluated their priorities and needs during the lockdown period. This has meant that there has been an increase in discounting across the Newcastle market as some sellers try to ensure sales. Where discounts have been offered in 2020, the average discount rate has been around -5%.
On balance, those looking to sell quality family homes and larger apartments, especially with some form of outdoor space, will find persistent buyer demand. However, as we move into the Winter market, sellers of some property types may find activity diminishing and sales less easy to secure.
If you are looking to sell your property in Newcastle, please don't hesitate to contact us.
