House prices have risen dramatically in the UK in the last two years due to an increase in the gap between supply and demand (source). As more people look to buy new homes, the demand for housing continues to outweigh the supply, pushing prices up. This is a trend that has become apparent in many parts of the country, including Norfolk. In this guide, we’ll analyse the statistics and discuss how the demand for property is impacting buyers and housebuilders.
Rising demand for housing in the UK
Figures from the Office for National Statistics show that year-on-year house prices had increased by 13% by June 2022. The average property cost almost £295,000, the highest figure since 2004 (source). The rising demand for housing is one of the main driving factors for price increases. As the number of people wanting to buy outweighs the number of properties for sale, average prices surge. House prices have increased most in Wales and the South West of England, and there have also been dramatic rises in parts of rural England, including Norfolk. The average price for detached homes in remote areas has risen by over 30% compared to 6% for flats in urban areas (source).
House prices in Norfolk
Across the UK, there have been noticeable increases in both the level of demand and the average cost of property. In some areas, there was a particularly dramatic increase in the demand for housing during the pandemic, with many buyers looking to swap the city for the countryside. In Norfolk, there was a 22% increase in the number of properties sold in 2021 compared to 2020. The most significant increases were reported in King’s Lynn and West Norfolk where property sales soared by almost 35% in the space of two years (source).
In addition to a desire to relocate to more remote areas, figures show that the number of properties on the market in the region has fallen. Increasing demand and falling supply have created a situation where houses are sought-after and competition for new homes is fierce. In South Norfolk, the average cost of a property hit a record high of £330,000 in December 2021 (source).
Why is the demand rising in Norfolk?
The demand for housing in Norfolk has risen steeply in the last two years due to the pandemic and changes in the way we live. More and more people are working from home, which means that being close to the city isn’t as important for many families. Lockdowns also increased the appetite for country living and proximity to green spaces.
Surveys suggest that buyers want to move to rural areas, such as Norfolk, to be in the countryside, to embrace a more relaxed pace of life, to get more for their money and to enjoy a better work-life balance. While many people have the option to go into the office or a communal workspace, many are working from home or adopting a hybrid approach. Almost 15% of people work exclusively from home and 24% combine office and home working, according to ONS figures (source).
The demand for housing is increasing in many parts of the UK, including Norfolk. House prices have risen sharply, the number of people wanting to move to Norfolk is increasing and the number of properties on the market has fallen.