We may have just gone through something of a cold snap, but the green shoots of spring arent far away. And, according to a new Property Confidence Index for Darlington and the Tees Valley, the regions property market could be showing signs of growth too.
Following a property forum event, hosted by Darlington Building Society (DBS), which Latimer Hinks attended along with experts from the areas property businesses, the first index has been created to monitor the strength of the local property market.
Utilising quarterly data from a group of local estate agents and DBS mortgage lending figures, the index will track the number of transactions, the average value of new mortgages and agents evaluation of the strength of the sector locally.
The first set of data, from the final quarter of last year, has now been released, showing there were an average of 107 transactions per agent in the area, that the average value of new mortgages was £87,000 and the average rating of strength of the market was 6.5 out of a possible score of 10.
It gives us a useful snapshot of the regions property market that goes above and beyond the usual house pricing information which is readily available.
While winter may be traditionally a time when the market slows down as we all gear up for Christmas and then go into hibernation mode with each snap of cold weather, Darlington and the Tees Valley has still seen more than 700 transactions among our selected agents. The average value of new mortgages looks low at first glance, but we do enjoy relatively low house prices in our region and this figure also takes into account those taking out a new deal to re-mortgage, perhaps to carry out home improvements.
With the next quarter of results, well be able to compare transaction numbers, mortgage values and how confident agents are feeling about the market. But signs from the first index are positive.
Confidence in the property market mirrors that of positivity in the wider regional economy.
While the Tees Valley has no doubt suffered employment body blows in recent months, notably the closure of the SSI steel works, there have also been good news stories, with many firms starting 2016 by picking up new contracts and recruiting new staff.
Reflecting on the Bank of Englands Monetary Policy Committee decision to keep interest rates at historically low levels, a move which will only benefit buyers taking out a mortgage, the banks deputy agent in the North East, Andrew Hebden, talked about how Teesside firms were remaining resilient.
Many businesses, he said, were continuing to invest, with the services sector being particular buoyant. Wages in the North-East, however, as measured by the Labour Force Survey, had not risen as strongly as expected.
So, while many people in the region may be feeling more confident about job security, leading them to make this spring the time they start their house hunt or make their property purchase, low wages may mean they cant borrow as much as they might have hoped, even with low interest rates. It could mean while we have a decent number of property sales going through, prices may struggle to rise this year.
The launch of the new index gives us a useful starting point and the release of the next set of figures for the first quarter of this year will give us an even better picture of how confident property agents, vendors and buyers are feeling about the regions housing market.