Wales regional property report

publication date: Jan 8, 2018
author/source: Kate Faulkner, Property Expert and Author of Which? Property Books

What's happening to property in the Wales?

Report Headlines

LSL Acadata HPI “Vale of Glamorgan sees highest increase in annual prices as Wales rises up the table.”

Source: UK HPI

The first thing that strikes me with the Welsh data is what cracking value properties are here! My family originates from central Wales – near Rhayader in the Elan Valley – and when I visited recently, I found the chance of being able to live in such a beautiful place at these prices very tempting! However, what we know about property prices is they are restricted regionally based on people’s wages and equity wealth and the reality is high paying jobs just aren’t that common in Wales, so prices tend to be boosted in tiny areas through second homes and in some of the posher areas of towns and cities such as Cardiff, which do have ‘top jobs’. What you can also see from the data is that prices have struggled to recover from the recession and are only just now doing so. For first time buyers, this does mean it is still a great time to buy as effectively prices are exceptional value in real terms, with inflation taken into account. You can take your time as, in the main, prices are rising at a lower rate than they have been growing annually since 2000.

Towns and cities

LSL Acadata HPI “Wales has moved up the league table of regions to fourth place with 3.3% growth. As recently as June it was bottom of the table. The Vale of Glamorgan (up 9.6% - the biggest annual increase of any unitary authority), Bridgend (8.6%) and Caerphilly (8%) have all grown particularly strongly in the last year.(Nov 17)

RICS “Solid gains were reported in Wales. With regards to the near term outlook for house prices, three month expectations are now more or less flat at the national level as the net balance moved to -5% from -10% in the previous month but in contrast to this, contributors are confident that prices will rise in Wales during the three months ahead.” (Dec 17)

Source: UK HPI

Those national reports telling FTBs they can’t get on the ladder and they will need £60,000 or to save for decades for a deposit are simply is not true for the Welsh market. An average FTB price of £132,000 means a 5% deposit requires £6,600 and between two people that’s just £3,300. Saving via the Help to Buy/Lifetime ISA means that you actually need to save UNDER £5,000! Your monthly mortgage at 4% would be less than £670 per month, of which £418 would be interest to the lender, so anyone paying less rent than this is also getting a very good deal. Even new builds are averaging at £206,000 which, with the 5% Help to Buy Scheme, means you can get a brand new property for £10,300 deposit (or £7,725 with your 25% government ISA top-up) AND a free 20% loan under Help to Buy which means a mortgage of £156,560. These are terrifically affordable for many people, especially if buying as a couple or as two, or even three, friends. And bear in mind these are averages; people are buying for a lot less too, so property in Wales is truly affordable in many places.

Wales price forecasts

With the forecasts showing tiny increases over the next 12 months and even over the next five years, affordability of Welsh properties could potential even be easier if wages keep growing in excess of expected house price growth. Just 1% growth is expected in 2018 by Savills and 2% by Countrywide, which means that 15 years from the recession, property prices are hardly rising at all. As a result, people have time to save without worrying that prices will run away from them. Taking advantage of Help to Buy schemes means buying a home in Wales is truly possible and the affordability issues often highlighted in the papers are far less relevant for many in this area.

Renting in Wales

With FTBs being able to buy a property for £670 a month mortgage (of which £418 would go to the lender in ‘dead money’ in interest), the average rental costs of £600-£700 per month – which don’t include money for the likes of maintenance and property upkeep – make renting great value versus buying. And with property prices not rising at too high a rate, this means that tenants shouldn’t feel guilty or worried about renting and not necessarily getting a foot on the ladder, especially in the next year when prices aren’t really expected to rise at all. With Wales being one of the few countries in the UK that now has to have suitable qualified people managing rental properties, it is also to be hoped that tenants should be treated far more fairly than some are in England where – for now at least – anyone can be landlord or agent. It will be interesting over the next few years to see if this makes a difference to tenants, and in what way.

For more, download our comprehensive Wales regional property report.

Renting a property - Property Checklists First-time buyer quick guide - Property Checklists Quick guide to buying and selling - SLC

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