Looking forward to the year ahead, the UK property market and property prices are expected to steady in 2023, after the previous twelve months saw record growth. Industry experts all forecast property prices to continue on an upward trajectory for the year ahead, which is great news for those looking to buy.
With demand for property expected to remain strong during this time due to stamp duty cuts and several government support schemes, we take a deeper look into what trends are emerging in the homebuyer market that are likely to impact the property market in 2023.
The Covid pandemic had a huge impact on what homebuyers looked for when buying property, resulting in the “Race for Space” becoming the main property trend in 2020 as an increasing number of buyers left city centres in favour of more leisure and green space.
However, as life returned back to normal, town and city centres reopened and people returned to the office; city centre apartments experienced a resurgence in demand, particularly with the rise in hybrid working which saw homebuyers wanting quick, easy access to amenities and the work place. In fact, search data from Rightmove revealed that the demand for apartments for sale overtook interest in terraced houses since the start 2022.
This resurgence in demand for apartments has also been influenced by another property trend that continues to impact homebuyer decisions.
A recent survey by Knight Frank revealed that 86% of respondents rated energy efficiency of a property as either “important” or “very important”; whilst Savills research reinforces this, with 71% of people surveyed citing a property’s EPC rating playing a crucial role in their decision-making process.
With that said, the Office for National Statistics data revealed that apartments and maisonettes were the most energy efficient property type in both England and Wales, with the median EPC rating C.
As the cost-of-living crisis continues to put pressure on the homebuyer market, demand for more energy efficient property remains strong and will most likely become a leading property trend as homebuyers look to reduce their monthly outgoings.
A prominent property trend emerging for 2023 is an increase in homebuyers opting to buy new build properties instead of older, period properties.
Search data from Savills indicated that regional reservations for new build property continues on an upwards trajectory, with regional reservations up by 7% in Q1 2022 compared to Q1 2021, equating to an increase of 41% on Q1 2019.
More recently, the NHBC recorded a record number of new build home registrations for every house type in Q3 2022, with a 114% increase on Q3 2021 and a huge shift back to new build apartments specifically – 45% of all new apartments registered during this time were in London.
As the increasing cost of living and energy bills puts a strain on household disposable income and people look for more ways to reduce their monthly outgoings; this trend is expected to continue to influence the UK property market throughout 2023 and beyond as homebuyers realise the potential cost savings new build property provide over older homes.
When comparing older properties to new build property, the latter typically scores a higher EPC rating because of advancements in construction, materials and the government push for more environmentally friendly housing stock. This is backed by Savills research that found that the most common EPC rating for new build apartment is B compared to EPC rating C for older apartments, primarily driven by newer building techniques and materials, better insulation as well as government targets for all properties to have a minimum of a grade C EPC rating by 2035.
URBAN REGENERATION
Historically, areas that experience investment in urban regeneration have seen an increase in interest from homebuyers and property investors with a long-term focus on returns and capital gains. As a strong indicator of future growth in both demand and property prices, considering recently regenerated locations when buying property isn’t just a property trend, but a key consideration.
Over the past couple of years, numerous ambitious regeneration schemes have been taking place up and down the UK, particularly in the South East where towns such as Bracknell now attract a high volume of London leavers.
Areas which were once quiet commuter towns are now some of the top property hotspots for homebuyers and provide strong potential for a healthy return on investment in the years to come. In fact, the region recorded one of the biggest price increases in the UK, up by £28,068 over the last 12 months to the end of November.
If you’re looking for your new home and you’re still unsure on the best location to choose, learn how regeneration impacts property prices and discover our top 5 urban regeneration hotspots here.
