As 2022 draws to a close, it’s safe to say that the housebuilding industry has had its fair share of trials and tribulations to overcome this year. We’ve witnessed multiple prime ministers and housing secretaries come and go, the country enter recession and local housing targets scrapped, and that’s just in the last few months alone.
But what will the new year hold? Showhouse takes a look back at the year and speaks to a number of key figures within the industry to hear their thoughts and what they believe 2023 has in store.
Guy Burnett, executive director of development at SO Resi:
2022
“2022 has not been without its challenges, to say the least. Where the private market has faltered, affordable schemes such as shared ownership have consistently demonstrated success in helping first-time buyers get onto the property ladder, enabling those with reduced earning power or limited savings to purchase a home. This year also welcomed an overhaul of the shared ownership scheme, making it even more accessible. Help to Buy has come to an end which means that we will see increased interest for other low deposit schemes such as shared ownership, and our records can consistently demonstrate this demand has increased since October this year.”
2023
“It’s generally accepted that house prices will fall in 2023, but it serves well to remember that lower house prices do not necessarily make homeownership more affordable for first-time buyers. As it becomes a less desirable sales market, fewer properties will become available to purchase, again this will send people in the direction of affordable schemes. Equally, many people will put off their home purchase for six months or more and try to ride out the uncertain market conditions.”
“As the mortgage sector settles, we’ll expect to see the wider market start to come back to life in summer 2023, though I am confident that rates will not reach the historic lows that we have seen in recent years. With the race for space well and truly over, the apartment market is not expected to take the same hit, as buyers look for smaller homes that are well connected, more affordable, and cheaper to run. Against all odds, I believe that 2023 will be the year of the first-time buyer, and shared ownership will continue to hold a major stake in making this possible.”
Simon Cox, founder and managing director of land agent Walter Cooper:
2023
“With the cost-of-living crisis and recession continuing to take its toll, affordability will be key in 2023. House prices are expected to decrease and what for many years has been considered a sellers’ market may take a turn, with offers below the asking price already starting to be accepted as many buyers attempt to tackle increasing mortgage rates. I expect 2023 will see the return of a more balanced market as housing stock and sales numbers decrease back to pre-pandemic levels.”
“However, while overall supply numbers are set to decrease, I expect the demand for new build homes is likely to continue. Larger housebuilders in particular find themselves in a more stable financial position than in the previous recession, as a result of the booming market over the last few years. Given this, I expect to see continued demand in the land market from those companies looking to take advantage of the falling price of land. This is likely to have an impact on the wider industry, as SME housebuilders, who will be more affected by rising material costs, struggle to keep up with the competition allowing the top PLCs to take the monopoly of the new build market.”
“My main concern for the new year is, as always, issues in the planning sector. The government’s recent housing targets announcement has left me feeling less than optimistic about the state of local planning departments in 2023. The number of new developments which currently achieve timely planning permission is limited, to say the least, and without a clear housing target in place and councils now having the ability to reject these targets entirely, I can’t help but feel these levels will decrease further. Those councils already overrun by nimby attitudes will have now have an excuse to limit growth and development with little to no repercussions.”
Lynda Clark, CEO of First Time Buyer Group:
2022
“2022 has certainly left first-time buyers’ pockets lighter, for better or for worse, as this year has seen mortgage interest rates rise, the cost of living increase, but also the conclusion of Help to Buy, which has had a monumental impact in bringing homeownership within reach of first-time buyers. While the fault lines of the cost of living crisis will run into the next year, developers and buyers alike who keep a steady hand in 2023 will find that there are still opportunities available for those who are willing to take the leap. Homeownership is still a fundamental right and aspiration for young people across this country, and I remain confident that the best time to buy is only when you can afford to.”
2023
“As we look to the year ahead, I would remind first-time buyers that there are still many options available to help them, including shared ownership, which provides a low-cost route to homeownership. Newer schemes including Deposit Unlock and the First Homes scheme are available, and the stamp duty cut will remain in place for the next two years.”
Chris Heath, managing director of Manchester-based Cube Homes
2023
“I think we could see house prices drop by as much as 10% from the peak last summer, whether that all happens in 2023 or over the course of the next two years I am not sure yet. However, what I don’t see is a drastic collapse of the property market, I think it’s more likely to be more of a gradual dip. Despite mortgage rate rises and the cost of living crisis, people will always need to move home at key times in their life – when they get married, have kids, get divorced or buy their first property.”
“Despite all the scaremongering, there are signs the economy is stabilising a bit – the pound has risen against the dollar and the price of diesel on the forecourts is starting to fall, so it definitely isn’t all doom and gloom despite what some commentators are saying. I do think some people are capitalising on the unstable market to put prices up much more than their costs have risen, and that kind of profiteering is very disappointing, especially when it hits smaller businesses on tighter margins like ours.
“For Cube Homes it will be business as usual in 2023, we will continue to buy new sites but we will be cautious and focus on the really desirable areas where people want to live, now is not the best time to take a chance on an ‘up and coming’ area.”
Phillip Hulme, sales director at Anchor
2022
“Current economic uncertainty and the rising cost of living are underpinning a rise in enquiries about downsizing towards the end of 2022, and we expect to see that trend build in the new year as homeowners continue to feel the pinch.”
“There is a considerable undersupply of suitable homes for older people. With an ageing population, that gap will only widen. I very much hope 2023 will be the year that the barriers preventing that big increase in supply are addressed by the government as this will also relieve pressure on the whole housing system.”
2023
“As we go into 2023, we are committed to doing more to meet the diverse needs of older people in a sustainable way. We are working hard to reduce our carbon footprint and improve the services we offer such as the provision and management of green spaces which promote diversity and enrich residents’ experience.”
Rachel Lindop, head of sales at Dandara Northern Home Counties
2022
“The 2022 property market was the best I have witnessed in my fifteen years in the industry. It was interesting to see how buyers’ priorities shifted when looking for a new home in the past year – the priority has been community and outdoor space as well as energy efficiency and versatile indoor space. Buyers have also been noticeably more informed, not only about the area they are looking to move to, but also what they need to look for to keep their bills down.”
“For the past few months, in particular, the headlines have been predominantly ‘doom and gloom’, however, from what we’ve witnessed the market is still strong and our enquiries have stayed consistent across our developments in Buckinghamshire and Bedfordshire.”
“We’ve seen a significant increase in sales from the more upmarket buyer with extra disposable income using schemes like Assisted Move in order to help them sell their existing properties quicker – a scheme which has probably been utilised more in the last three months than in the last couple of years! I think this has largely been driven by the recent political and economic uncertainty with buyers prioritising a more secure purchase in difficult times.”
2023
“As we head into 2023, the biggest challenge currently facing the property sector is undoubtedly the cost of living crisis and current inflation rates, which we’ve already seen is hitting the first-time buyer and investor market the hardest. This will remain hit and miss until interest rates begin to stabilise, and people feel comfortable that they have survived a winter with increased bills. Once buyers feel more confident that they can afford these rises, which government policy plays a huge part in, this will definitely help drive the market forward.”
Jeremy Heath-Smith, CEO of Spike Global:
2023
“Companies that have not yet embraced using digital technology to reach their audience are operating behind the curve. The big question for developers and BTR operators in 2023 is how to continue to remain attractive to customers within an increasingly competitive market. The ability to offer residents extra benefits goes a long way. Offering an easier way for them to manage their tenancy and enabling them to get the most out of where they live, will help developers to attract and keep residents. With the new additions to the safety act coming into force in October 2023 developers and building management companies will need to be able to efficiently communicate with their tenants and for the tenants to easily access information. Spike will help their clients through this process.
Source: Show House News
