Market Report Q3 2023
Once in every calendar quarter, Cyanwood publishes a seasonal market report to tell our clients and business partners what’s the latest trends and topics in UK’s built environment sector. We analyse data and information provided by Land Registry, Office for National Statistics, retail banks and some leading listing platforms.
Key Commentary Q3 2023
The third quarter of 2023 sees a significant decline of number of UK’s residential transactions, where the raising interest rate and economic uncertainty are the key factors behind this market trend change. Commercial and industrial property sectors remain solid except for metropolitan central offices.
Is August the new winter?
This August, the officially published number of UK residential property transactions is 16% lower than August last year. Together with a 22% decline in July and a predicted 12% decline in September, the resilience of residential market has been truly under the test in Q3. While non-residential sectors remain steady, with just 3% fluctuation in activities.
Mortgage rates in a decade high
The UK fixed mortgage rates for new applications hit highest level since 2008, median product rates ranging from 5.12% to 6.66%, in more bad news for new buyers. Hundreds of mortgage deals have been pulled off the market again as lenders rush to re-price their products.
Co-working may become cobalt-bomb
The reduced demands of co-working space and flexible office plan across the major global cities lead to the financial turmoil of leading operators. UK landlords may face a £3.5bn shortfall in rental income if two largest co-working tenants collapse, with many REITs trading a 40% value discount.
Longer term, smaller size
More than 25% of mortgage applicants aged under 40 in the first half of this year chose a 35-year term, a historic increase compared with past dataset. Also, more buyers are searching for smaller residential properties, as purpose-bult flats become more popular than maisonettes or terraced houses in search trends.
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