What is happening to Harborne property prices?

Measuring housing prices and metrics is a very topical point of conversation and indeed of wide spread reporting with the current economic climate.

If you are a Harborne home owner or looing to be, I am going to be looking at where Harborne property prices are right now, what has happened to them over the past 12 months, the past 5 years, and finally how they compare to the recession of 08/09.

It is important to compare the property market over different periods of time, to represent an accurate representation of the present,  because if we just compare it to the “unicorn years” of 20/21/22 things are going to look very unbalanced. 

Starting with current asking prices, Harborne prices are up 4% year on year at an average £433,878 compared to £405,546 to 2022. This just goes to show how resilient the Harborne property market has been when up against rising interest rates and stretched affordability.

According to recent Rightmove data, supply is down 19% and demand is up 3% when compared to pre pandemic levels, with appetite being compared to a more ‘normal’ property market of 2019.

This goes some of the way to explaining why we have not seen a massive drop in prices following 13 successive bank rate rises and the highest rates we have seen since 2008. History has proven interest rates and house prices have an inverse relationship and it is the supply and demand levels that really impact what happens to prices. 

However, asking prices only tell half the story, because on average 60% of properties are remaining unsold, and 40% are reducing their asking price.

We also need to look at what properties have actually sold for and so far this year, the average sold price is £399,238.01 compared to £395,898.44 for the whole of 2022.

This is further evidence that the market has remained robust throughout a very uncertain political and economic period but it is clear we are no longer in the booming Covid market and pricing your property correctly is paramount to achieving a sale. 

The past 5 years have seen Brexit, Covid, four different prime ministers, war in Ukraine, each in isolation can impact any financial based market place.

Yet, with this backdrop, potentially considered against all odds, property prices have risen in Harborne.

Harborne price rises were pretty steady in 2018 and 2019, but shot up considerably as you can see in the above image between March 2020 and April 2022. Prices hit a peak in September of last year just before the now infamous mini-budget, but again many commentators predicted severe price drops following this and we are yet to see it happen, indeed only last week Lloyds reigned in their initial predictions of the national property market expecting a 14% drop, to a more conservative 5% downturn, which is also in line with Zoopla’s estimates for 2023 in their latest housing index. There is no doubt going to be a short term correction nationally in the market due to interest rates, cost of living, and inflation but it does not appear to be as severe as the media will lead you to believe.

Some price adjustments and higher rates were long overdue but property remains a hedge against inflation longer term (the average person owns their property for 18 years), increasing the value of your asset and decreasing the value of your debt. 

In interesting co parison is to look back at the last time prices dropped significantly and the property market contracted was when we saw prices reduce by 15% in 2008 amidst the “financial crash”.

Would you be surprised to know that prices in Harborne are actually now 90% higher than they were in 2008?

I hope the insight of conditions in the immediate local market gives you useful information, and if you want to find out more about what is happening in the Harborne property market, please do contact me to discuss this further.

Andy McHugo, Director, McHugo Homes

07751 675267 andy@mchugohomes.co.uk

P.S Unicorn years is 'something that is greatly desired but difficult or impossible to find"