House prices in Wales: a spring market update
Spring is one of the busiest times in the housing market.
Among a few other factors, the nicer weather and longer days mean more people are out and about viewing properties.
As we head into the busy season, many people are wondering about house prices in Wales and the state of the market.
The average property price has seen a slight increase of 3%, reaching £219,000 as of November 2024. This is slightly below the UK average increase of 3.3%, but it’s not far behind.
Let’s take a closer look at what’s going on.
Market trends & buyer choices
The market dynamics in Wales are influenced by several factors.
The number of available homes for sale has reached a 10-year high, giving buyers with more choices and pushing sellers to reduce prices.
This surplus has led to a more balanced market, moderating the usual price surges typically seen during this season.
Challenges for first-time buyers
Despite these price changes, many first-time buyers in Wales are struggling to get on the ladder. Data shows that only 11.5% of them can afford to buy a home without help.
In areas like Ceredigion, that figure drops to just 3%, highlighting how stretched affordability has become. In fact, a report published by Skipton Group building society found that Wales is the least affordable area in Britain for first-time buyers.
Upcoming changes to stamp duty in April 2025 might further impact this group, as the tax-free threshold is set to decrease from £425,000 to £300,000, putting more strain on new buyers.
A growing price gap between houses & flats
In terms of property types, houses have experienced a more significant increase in value compared to flats.
Over the past five years, house prices in England and Wales have risen by 31%, whereas flat prices have seen a 30% increase over ten years.
This disparity is likely due to rising insurance premiums, complex service charges, and changing buyer preferences post-pandemic.
What comes next?
Looking ahead, experts predict that house prices in Wales will continue to rise modestly, with forecasts suggesting a 3.1% increase over 2025.
Stabilising mortgage rates in the 4-5% range and a balanced supply-demand dynamic in the housing market support this prediction.
However, the ongoing north-south divide in house price growth could persist, with affordability remaining a critical concern for buyers in various regions.
Wrap-up
While the situation appears somewhat negative, there are always opportunities to be had with the right guidance.
If you’re looking to buy, sell or simply stay informed, James Douglas is always eager to assist.
Give us a call today to chat about your goals.
