It is that time in the calendar when we look back at the past twelve months and look forward to the next twelve.
2014 has been a good year for the local property market. The recovery, which gathered pace in 2013 continued into 2014 with house prices increasing, bringing more people out of negative equity or enabling them to accumulate a larger deposit to move on again. However, the second half of the year saw prices stabilise and the year draw to a close with the Wellingborough and Irthlingborough markets looking very healthy.
Certainly in Spring of 2014 the market looked as though it was going to overheat again with huge demand and buyers prepared to outbid each other. At the end of April, Mortgage Market Review (MMR) was introduced which meant lenders had to adopt stricter criteria to ensure the borrower is protected from debt. This put more emphasis on the borrower’s outgoings rather than income, ensuring the borrower can afford their repayments after their normal bills and “life style” commitments. Furthermore, lenders have to apply a stress test to ensure if interest rates were to rise by 3% their mortgage repayments can still be met.
The Governor of the Bank of England, on a couple of occasions, made a statement of potential interest rate rises, something which is unprecedented; normally rates are increased without notice. Maybe this was a warning shot to calm house prices, particularly in London and the South East. This certainly did create caution with local buyers and sellers.
As we move into 2015 there is great optimist for a stable and steady market, with analysts predicting a 3% yearly price increase in the region. However, as always there are many unanswered questions. With general election fever gathering pace, will some buyers and sellers hold off until after May? Will the reforms in pensions bring an influx of new buyers into the market hoping to get a greater return from owning a buy to let property? Will this put more pressure on demand for entry level properties?
Every year there are twists and turns in the housing market with different challenges to overcome but with the local economy in generally good shape we believe there will be strong activity from the outset with many buyers looking to take advantage of some of the outstanding mortgage deals available again.
If you are looking to sell or buy in 2015, please talk to us.