23 May 2022
House prices have risen for what feels like an eternity, with the average UK home costing a whopping £25,000 more than it did in 2021. Are these increases finally ending? We take a look.
The incredibly competitive market brought about by the pandemic and the stamp duty holiday has caused prices to soar – Halifax reports a rise of over £47,000 in the past two years – but increases are now beginning to slow as more and more potential buyers come back to the market.
In March, Propertymark reported an average of 84 prospective buyers registering with agents up and down the country, with 84% of properties at or above the asking price – 4% more than in February.
Supply being bought has never been in doubt because of the vast imbalance between the number of sellers and buyers. Despite the influx of new buyers, this hasn’t changed much. In fact, the average time taken to sell a house only dropped by three days, to 33.
All this being said, although we can expect thousands more buyers and sellers to come into the equation throughout the rest of 2022, it is highly unlikely that we will see prices actually begin to fall.
Further increases of 3.5% have already been forecast for this year, and a potential 3% more in 2023, but some experts claim that prices will increase by a maximum of 2%. Given that the average monthly increase so far this year has been around 1%, there is reason to be optimistic of lower rises.
For wannabe first-time buyers, it looks like this is as good a time as any to climb onto the market. Prices are already forcing millions across the country to continue renting or move back home to save enough money, so those who can afford to buy a home should jump at the opportunity before further price increases come into effect – which is happening month on month.
Competitive mortgage deals are currently available, but the extreme demand for property means that you will have to be decisive in order to land the property you want. Interest rates will likely be a big factor in your decision to either buy now or hold off, with the majority of first-time buyers wanting to wait until they begin to drop.
If you’re already established on the property ladder, it may also be worth waiting until the tail-end of the price increases before selling your property.
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