Lomond Insights: Birmingham property market Q3 review
As we leave summer and head towards what is typically the busiest time of the year in the Birmingham property market, we look back at the trends and statistics of 2023's third quarter. Property prices continue to change, and the levelling out of interest rates have seen varying moods in the property market.
Activity levels have been resilient; sales agreed were slightly down in August but this is expected during the summer holiday period. Price adjustments have been high on the agenda as vendors expectations are adjusted.
Our main challenge is stock, with fewer properties coming to the market. On the plus side, this has shielded us from any significant price falls. A lack of good quality stock for downsizers, such as small build redevelopments, is preventing major stock release. Despite the seasonal slowdown, the market has not lost momentum; our applicant registration is very strong and all signs are pointing to us entering a busier market.
Having experienced less price growth than other property types, studio and 1-beds are relatively more affordable, and increasingly popular with couples.
Mortgage rates are heading in the right direction, and people are accepting current rates as the norm and building them into their affordability. There are active buyers in all areas of the market for good quality, correctly priced properties.
We have seen lower levels of churn in our rental market, with fewer checkouts over the last quarter. People are renting for longer and Birmingham, a vibrant city with easy access to rural areas, is a good place for renters to settle.
Rents are still being pushed up and demand is strong, with rents typically rising from 10-15% on any relet and 5-10% on renewal. We haven’t seen any spike in renters falling into arrears. This has remained steady, partly driven by the choice and quality of the properties we manage, spread between the city centre, rural and suburban markets.
People are generally adjusting their lifestyles in the face of higher rents, prioritising the roof over their head and changing their spending habits. Increasing numbers of couples are considering renting smaller properties, attracted by reduced bills and council tax, and these are letting very quickly. Renters and buyers alike are taking energy efficiency into consideration, as they build bills into affordability calculations.
Although we have seen an increase into enquiries from landlords about their properties’ worth, we have not seen any dramatic landlord exodus. However, the introduction of Selective Licensing in Birmingham, which requires landlords to obtain a license as a prerequisite to letting out a property, has knocked landlord confidence, seeing it as another reduction to return on investment.
HOW WE PERFORMED IN Q3
Despite changes in both the sales and lettings markets across Yorkshire, our teams of property experts continue to deliver brilliant service to our thousands of customers.
While we continue our efforts to grow the company even further, our teams produced the following numbers in Q3:
SALES (per branch)
- 16 new instructions
- 115 applicants
- 7 contract exchanges
- 7 applicants per property
LETTINGS (per branch)
- 34 new instructions
- 406 applicants
- 12 applicants per property
- 67 new tenancies agreed
Richard Crathorne, Chief Executive Officer, summarised: “Outwardly looking and adaptable, our team is here to assist and advise. We are adding new services that suit the ever-changing market.”
You can read the full summary of the Birmingham property market below, or click here to learn how Lomond is transforming the UK property market, notably in the investment sector.