Due to the pandemic and stamp duty holiday, the last 12-months have been difficult for people looking to buy a new house. The prices of houses have risen continuously in the year 2021, bringing about a more volatile market. However, after a year of high prices and vicious competition, the growth in prices of properties is likely to slow down in the year 2022 as the market has started to settle down. The year 2022 has bought about more new property opportunities, so 2022 might just be the year you find your dream house.
How have house prices changed?
The year 2021 showed a considerable rise in property prices. The most reliable barometer used to measure property prices is The Land Registry’s ‘UK House Price Index. This barometer is considered the most reliable because it is based on the sales of property not just on the prices. The land registry stated that there had been a rise in the average price of properties in the UK by 10.9% in February 2021, which increased from £240,000 to £276,755.
Is the property market set to slow down in 2022?
It is predicted that the average price of a property will rise by 5% in the coming year, which is currently £342,401, which may further result in a £170,00 increase in prices. This is due to a mismatch between demand and supply in the property world. Savills, an estate agency recently presented a survey which showed that nine out-off ten property buyers have been affected due to a lack of available properties.
Another estate agency, Propertymark reported that every available property had an average of 26 buyers in February 2021. Propertymark also stated that 80% of the properties were sold at the asked prices or above which was 2% more compared to January 2021. Hence, this imbalance between supply and demand may continue to push property prices up.
However, 2022 may be a breath of fresh air for property buyers as there has been a 19% rise in the number of people who want to move, which is expected to result in more available properties for buyers, which may also lower the pace of the growing prices.
Tarrant Parsons, an economist at ‘The Royal Institution of Chartered Surveyors’ (RIC) stated, “2021 has been an exceptionally active year for the housing market, with transactions close to record levels. However, despite more homeowners seeking more space and various incentive programs… transaction activity for the coming 12 months will be inevitably slow”
Price growth in different regions of the UK:
The most popular regions for property buyers are The Humber, Yorkshire, Scotland, The west Midland, and the Southwest. The forecast shows that these areas are likely to see a 7% rise in prices in the coming year. London however, hasn’t seen much of a rise in prices as other areas of the county have, hence it has been predicted that there may be just a 3% increase in the capital city.
Is it easy to obtain a good mortgage deal?
In 2021, there has been a consistent fall in mortgage rates. This is because the property owners battled to offer affordable deals to the buyers with high- deposit rates, but they’re now has been a change seen in this. Yes, it is true that there has been a rise in rates off the back of three increases to the ‘Bank of England’ base rate, however, there are still some affordable deals available.
Is 2022 the year to invest in new properties?
Getting into the property market this year may be a gamble as it comes with its own set of pros and cons. The good news is that due to the availability of low-deposit mortgages, it will be easier than before for buyers to obtain a home loan. However, it is seen to be unlikely that property prices will be more affordable. Even though many property experts have predicted slower growth in prices of properties, none have forecasted an actual fall in prices.
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