Firstly let us say that no we have not lost our minds and its not a typo in the title of this post!
There are many factors that need to be considered when working out how UK housing prices are calculated but we are betting that you never considered carpet. Before reading this post had someone asked you a question like…“How are housing prices calculated?” were betting that you might of mentioned the following:
- Economic Growth
- Interest Rates
- Consumer Confidence
- Mortgage Availability
…we would of been pretty impressed if you had mentioned carpet but we are certain you didn’t. So allow us to explain then how this fibrous home fixture is a factor to working out housing prices.
So what are we talking about
We take our statement from Carpet and floor fitters say that a buoyant market means more trade and, after a post-recession slump, things have started to pick up. They say that people moving are buying new carpet to offer a more attractive home and people staying are trading up and making their living environment more comfortable.
Based on the Nationwide’s own lending data, prices in London rose by 17.8% over the course of the year, according to the lender, compared with 1.4% in Wales. Another survey, by rival lender the Halifax, says that prices rose by 8.5% over the year, although its official house price index data has not yet been published (figures are for 2014 and are expected to carry through into 2015).
The rise in prices and activity is reflected in the number of people buying carpets. Wilf Walsh, chief executive of Carpetright, says that the outlook is “mixed”, but there are signals of pent-up demand being released.
Ian James, president of the National Institute of Carpet and Floorlayers, says that business is “still a bit slow in the North East” of England, but has been picking up elsewhere.
“The last five years have been pretty poor,” he says, explaining that many fitters could not find enough work from independent carpet retailers.
“But we can see the shoots of recovery. We had our biggest trade show in years. There is a trend of [consumers] going back to carpet instead of cheaper laminate flooring.”
As may be expected, these home improvements are lagging slightly behind transaction levels in the housing market, with buyers perhaps waiting a few months in their new home before spending more on laying new carpets.
House sales were consistently above 100,000 a month in 2014, according to seasonally adjusted figures from HM Revenue and Customs (HMRC). It is the first time this has been the case since 2007.
Share your thoughts below in a comment and discuss what you think will happen to the housing market in the remaining months.