House prices in Wales have risen by 3% in the first quarter of 2022 to a new record average price of £233,361, despite high transaction levels beginning to ease off.
The figures have been released from Principality Building Society’s Wales House Price Index for Q1 2022 (January-March), which demonstrates the rise and fall in house prices in each of the 22 local authorities in Wales.
Wales continues to experience some of the strongest property price increases across the UK, with house prices also increasing by 9.7% annually as well as rising over the quarter. However, transactions in the first quarter are estimated to have been 4% lower than a year earlier, the second quarter in a row of lower sales.
Tom Denman, Chief Financial Officer at Principality Building Society, said: “Despite the strong headline performance, the underlying data gives some support to the view that the market in Wales may be beginning to slow. With cost of living pressures mounting and consumer confidence falling, it is possible that demand within Wales is moderating.
“None of this should be taken to mean that the market is moving into recession, far from it, but there is a sense here of a slowing market. The question now is whether households will hold back either entering the housing market or trading up due to the current uncertain conditions.”
Five local authorities – Blaenau Gwent, Carmarthenshire, Ceredigion, Merthyr Tydfil and Pembrokeshire – all reported high price growth year-on-year of between 13-14%, while Monmouthshire reported an annual price rise of 18.8% to £378,228. Monmouthshire also had the highest quarterly price increase (14.3%) and was one of 14 local authorities to report new peak house prices as of March.
Denbighshire stands out as the only local authority in Wales to record a decrease in house prices annually, dropping by 5.9% to £197,452. Prices dropped in Denbighshire over the quarter too by 4.1%, a pattern which has continued for several quarters since its peak price in June 2021.
The so-called ‘race for space’ prompted by the pandemic has slowed, with a significant drop in sales of detached houses compared with a year earlier, down from 4,200 to 3,100. The number of semis sold is also lower than a year ago, down 10%, while the sale of flats has risen sharply by 26%.