18 July 2022
House prices in Wales remain strong during first half of 2022
Wales continues to experience some of the strongest property price increases across the UK as the average price of a property rose to more than £240,000 for the first time in the second quarter of 2022.
The figures have been released from Principality Building Society’sWales House Price Index for Q2 2022 (April-June), which demonstrates the rise and fall in house prices in each of the 22 local authorities in Wales.
The new peak average price of £240,635 in Wales reflects an 11.5% annual increase and a 3.1% quarterly increase. Half of local authorities reported double digit percentage price increases in Q2, with nine areas also recording new peaks. Several authorities – Blaenau Gwent, Carmarthenshire and the Vale of Glamorgan – continue to report annual price increases of more than 15%.
Shaun Middleton, Head of Distribution at Principality Building Society, said: “Against the backdrop of significant cost of living pressures, with food, fuel and energy prices continuing to spiral, higher interest rates anticipated from the Bank of England, and the collapse in confidence levels across companies and households, there is a growing expectation that the wider economy will enter recession over the coming quarters. Across the UK, these cost-of living pressures have begun feeding through into lenders’ affordability calculations, whilst higher mortgage rates might affect the ability and willingness of households to borrow.
“Such changes appear modest for now, but they are cumulative in nature, and their eventual impact will be influenced by the ultimate extent of rate increases, the resilience of the jobs market and the ability of households to increase income. The housing market in Wales starts from a strong position, as prices have been steadily rising post-Covid restrictions but is not immune to these macro-economic challenges, and the likelihood is that housing demand and property price inflation will ease over the coming quarters.”
Property prices were up in all local authority areas when compared with the same time last year, except for in Denbighshire where prices are nearly 3% lower. However, price increases in several authorities – including Conwy and Merthyr Tydfil – are relatively modest, and these authorities will have experienced drops in real terms after taking into account the prevailing rate of consumer price inflation.
Market conditions appear calmer, with fewer instances of large quarterly price changes in either direction, despite Powys, Bridgend, Flintshire and Swansea posting quarterly increases of 5% or more. In total, 18 local authorities reported quarterly rises in Q2, up from 14 in the previous quarter.
Principality’s Wales House Price Index estimates there were as many as 11,900 transactions in Wales in Q2, 9% higher than in Q1 and well above corresponding levels in 2019, pre-Covid. In the second quarter of 2022, sales of detached homes are down nearly a fifth (19%) while sales of flats are up 14%.
For more information go to: House Price Index
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