2022 UK Property Market Predictions
The past two years have been extremely tumultuous for everybody affected by the Covid-19 pandemic. All industries were hit hard by the virus, and under guidelines created by the government, many businesses and economic sectors faced huge losses and restrictions. Throughout 2020 and 2021, the property market faced a frenzy that was ignited by the pandemic, sparking disruptions and dramatic changes in short succession. Over the last 18 months, the property market has faced extreme highs and lows. As we enter a new year, We Buy Any House have delved into the property market predictions of 2022; discussing the lasting effects of the pandemic, and how to make the most of this year if you are intending to buy and sell property!
How did the housing market change throughout the pandemic?
During the initial months of 2020, the housing market was brought to a halt due to the initial phases of lockdown. Under advice deriving from health experts, scientists and the British government, the entire UK came to a standstill in order to prevent the spread of Covid-19. Lockdown generated a huge cause for concern for a large majority of people, and homeowners were no exception. Any plans to buy and sell property faced instant delays that had no end date in sight, and for many people, their property investments and plans faced an unprecedented amount of uncertainty.
After almost three months of lockdown, the UK economy began to resume a certain amount of normality, as industries were allowed to open under strict government guidelines. Throughout the summer of 2020, the demand in the housing market reached an all-time high. The stamp duty holiday meant that prospective buyers could save up to £15,000 on their next property- and due to the extension of this holiday the property market steadied all the way into 2021.
Unfortunately, as we reached the end of 2021, house prices in the UK rose by almost 9.8%- which is a record high since 2007. The average price of a UK home by the end of 2021 stood at £276,091- which is over £24,000 more than the biggest increase since 2003.
What is set to happen as we enter 2022?
Due to the increased demand in property that occurred during 2021, property prices are set to remain somewhat unpredictable. Although they may not increase at the extreme rates of the last two years, typically accurate predictions of house prices are set to become a lot more complicated. Statistics gathered by property experts at the Express show that in 2021, over 1.5 million homes were bought in the UK, due to financial schemes such as the stamp duty holiday and government help to buy schemes which were widely used as many citizens were forced to work from home. This ultimately created an imbalance between supply and demand- which has transcended into 2022 and caused uncertainty in accurately predicting house prices. According to the experts at Halifax, the sudden surge in house prices is thankfully set to end as of 2022- however, there may be a slight increase in house prices as the year progresses. The mortgage lenders say that even though house prices increased over 6% in 2020 and 8% in 2021, after the uncertainty and tribulations caused by the pandemic over the last two years, the property market is still somewhat recovering from the adverse effects of the Covid-19 pandemic and the chaos it instilled throughout the past two years.
What will happen to interest rates in 2022?
Throughout the last few weeks of 2021, The Bank of England made the decision to increase interest rates for the first time in over three years- which came as an unexpected surprise for many. The decision was said to be made amid the growing concern regarding inflation and will inevitably place increased financial pressure on households who have variable-rate mortgages. Despite the rapid spread of the new Covid variant Omicron, which has aided the surge in living costs due to the strain on the economy, the Guardian newspaper reports that Threadneedle Street’s monetary police committee (MPC) had a majority vote to raise interest rates to 0.25%- after sitting at a historic low of 0.1%. Because of this, your home loan will be considerably more expensive in 2022, and if you are intending on coming off a ficed deal in order to find a new mortgage deal, the rise in interest rates could cause your monthly repayments to soar.
How will the 2022 property market affect first- time buyers?
For first time buyers in 2022, the property market may seem a bit of a whirlwind. Statistics shown by Forbes suggest that in 2022, around 45 million millennials aged between 26-35 are set to buy their first home- which is a positive as it will enable the property market to stay healthy and competitive. Despite the fact there is a lot of uncertainty due to the Omicron variant and the potential restrictions that could be implemented, the property market has proven time and time again throughout the pandemic that is resilient through challenging times. The growth in house prices is set to be sustainable, so if you can afford to buy a home you should definitely think about going ahead with it this year.
If you’re looking to become a homeowner this year, then you may be eligible for government support. Deposits of 5% can be used in the mortgage guarantee scheme, which will see big mortgage lenders help with properties up to £600,000. The scheme is not just accessible to newly build homes or first-time buyers either or will run until the end of 2022.
When is the best time to buy a house in 2022?
As always, the best time to buy a property is during the spring months. This is due to the fact that there are typically more properties on the market. In terms of a month by month analysis, March as proven to be a good month to buy- as the days are longer, the weather is warmer and there tends to be more house hunters on the market. Additionally, most people want to be moved and settled before July or August rolls around- as this is the time in which they go on holiday.
This article was written by a quick house sale company We Buy Any House. If you’re wondering “how can I sell my house fast?”, head to the We Buy Any House website for more information relating to all property related enquiries.
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