CHESHIRE AGENCY UPDATE – JULY 2022
It’s time again for the latest property market update, and once again we are reporting on unusual times for the market.
The RICS Residential Market Survey for June 2022 reported a drop in prospective buyers and a softening in demand whilst new agency instructions remained flat. However, prices have continued to rise, although the pace of rise is slowing. The key issue remains, as it has done for several months now, in that supply is so limited. Many sales are continuing to be agreed above guide or asking prices, although at higher prices (£1m+) this is less marked.
The north Cheshire market bears out the national picture and supply is wholly inadequate. Where a property is priced properly, interest is very strong and sales can often be agreed very quickly, often within a couple of weeks. There is some resistance to overpricing, particularly with flats; this may still be a result of lockdown and a move away from flats to houses with gardens and more space.
At Oakwood we have a number of properties that are market ready, but the vendors cannot find anything to move to. This is creating a bit of stagnation in the market but is understandable as owners do not wish to commit to a deal they may have to renege on. In the past vendors in this situation often rented between houses, but the rental supply is now so low too that this is less of an option.
The average house rice in Altrincham over the past year is £537,083 (source: Rightmove), with semis selling for an average of £488,119 and detached houses for £1,116,981. This is a 14% rise on the 2019 peak.
The suburban village of Bowdon has an average house price of £902,217 (source: Rightmove) with terraced houses fetching £607,963 and detached houses £1,493,239. These prices are up a massive 31% on the previous year.
Commercially the picture is similar, and we are seeing some fantastic prices for local property in all commercial sectors, save for town centre retail which is still suffering from lockdown. Every sale we see seems to bring a new record and yields are still moving down (which increases capital values). 5% yields on relatively modest covenants (i.e. quality of the tenant) now seem quite common whereas historically we’d have been looking towards 10% for local covenants. The logic seems to be that investors still don’t want to have cash in the bank due to low interest rates, despite the recent rate rises and 1% being exceeded for the first time since March 2009. There is commentary that rates will hit 2%, but property yields remain above this so we will more than likely see continued investment. Bear in mind that from 1997 to 2009 Base Rate rose to 7.5% and never fell below 3.5%, so we are in unprecedented territory with such a prolonged period of low rates.
Well-presented stock, especially with a well written lease and decent tenant, will sell better and there are hungry investors out there.
Finally, on to farmland where again we report high demand. Sales have been few and far between in Cheshire with only a small number of entire farms being sold. There have been a few smaller parcels sold and in general trends for these follow the residential market. Demand is broadly still driven by rollover money and taxation issues, but we are seeing farmers keen to buy to expand their operations. Many farmers are experiencing labour shortages, which is impacting on growth, especially in sectors such as fruit, vegetables and dairy. Hopefully the current heatwave will be a boost to arable farmers so they can harvest quickly and without the need for costly drying. The flipside is that grass growth is now weak, so livestock farmers may need to import feedstuffs and will struggle to make hay or silage for the coming winter. In the medium/long term climate change will impact on agriculture and this is bound to affect land prices.
At Oakwood our experienced team are happy to chat without obligation about your property requirements, whether you are looking to buy or sell. We operate in a range of sectors throughout Cheshire and South Manchester. We are led by qualified chartered surveyors who have been living and working locally for over thirty years (each) so have great market knowledge. The rest of the team are also local and dedicated to a professional service.
| Graham Bowcock | Managing Director | Chartered Surveyor |
| Andrew Aspinall | Director | Chartered Surveyor |
| Lydia Sirovica | Associate | Graduate |
| Ciaran Dwyer | Property Manager | Dedicated property manager and lettings agent |
| Hannah Murphy | Office Manager | First port of call for agency enquiries. |
