With the UK property market forecasted to stabilise in 2023, leading UK property developer, SevenCapital delves into the top four trends which are likely to dominate the homebuyer market for the year ahead.
City centre living
Following the previous ‘race for space’ which saw rising number of buyers leaving cities in favour of greener pastures, city centre living has quickly experienced a resurgence in demand as more people return to office working.
With search data from Rightmove revealing that demand for apartments has overtaken interest in terraced houses since the start of 2022, this trend is set to continue into 2023 as the draw of the city, its amenities and connectivity calls homebuyers back.
Energy efficient properties
With the rising cost of living and growing sustainability concerns, a recent survey by Knight Frank shows that 86% of respondents rated energy efficiency of a property as either ‘important’ or ‘very important’. This was further reinforced by research from Savills, with 71% of respondents citing that a property’s EPC rating now plays a crucial role in their decision-making process.
With previous figures from the Office for National Statics showing that apartments and maisonettes are the most energy efficient property type in both England and Wales, demand for energy efficient property remains strong. With a plethora of environmental benefits – as well as cost saving perks – buying a property with a better energy efficiency rating will continue to prove desirable in 2023.
Higher demand for new builds
Search data from Savills previously indicated that regional reservations for new build properties continues on an upward trajectory, with regional reservations up 7% in Q1 2022 compared to Q1 2021, equating to an increase of 41% on Q1 2019.
This is also backed by more recent figures from the National Housebuilding Council (NHBC) showing record number of new build registrations for every housetype in Q3 2022, with a 114% increase on Q3 2021 and a huge shift back to new build apartments specifically – with 45% of all new apartments registered during this period being in London.
With rising energy bills putting a strain on household disposable incomes, this trend is expected to influence the UK property market throughout 2023 as homebuyers realise the potential cost savings from buying a new build vs an older property.
New build properties also provide a benefit in the energy efficiency stakes, with research by Savills showing the most common EPC rating for new build apartments is B, compared with an EPC rating of C for older apartments. This is primarily driven by newer building techniques and materials, including better insulation, as well as Government targets for all properties to have a minimum EPC rating of C by 2035.
Purchasing in areas undergoing 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 can help homebuyers to potentially get more for their investment.
The last few years alone has seen a number of ambitious regeneration projects across the UK come to life, particularly across the South East with towns such as Bracknell and Slough attracting a high volume of London leavers.
Areas which were once quiet commuter towns are now some of the top property hotspots for homebuyers, providing 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.
For more information on SevenCapital visit www.sevencapital.com