Warnings by the Bank of England that interest rates must rise to combat inflation have had little impact, with demand continuing to overwhelm supply. The latest quarter-point rate rise takes the central bank rate to 1%; a tiny figure compared to the roaring rate of inflation destabilising the economy.
Buyers are betting that such minuscule hikes in the lending rate will not adversely affect their investments. They are also aware that uncontrolled inflation will rapidly erase their mortgage debt.
The data shows that the 2022 UK property market continues to perform strongly in all regions. Despite much higher prices, the typical time on the market of unsold property remains just above record lows, confirming that property is still moving through the market at a really rapid pace. For example, the typical time on the market for the East Midlands has moved up slightly but remains at a level not seen since the buying frenzy of 2007 before the onset of the financial crisis.
In fact, such is the strength of current demand that the median time on the market for unsold property in England and Wales is currently 24% lower than in May last year when the market was already showing clear signs of overheating.
Unprecedented scarcity persists across all regions with the average stock total dropping around 18% year on year. The largest fall in sales stock is in Greater London (22%), and this points to further strong price growth going forward.
Rents are up year-on-year across all regions except the North East where they remain unchanged. The mix-adjusted average rise for the UK remains just above 18%. A major contributor to this figure is Greater London which continues to indicate a stunning annualised growth of 37.1%. The scarcity of property available to let is the main driver and this is apparent in every region.
The annualised mix-adjusted average asking price growth across England and Wales is now at +6.6%; in May 2021, the annualised rate of increase in home prices was 8.6%.