02 Mar 2022
While January marked the beginning of a new year, there has been no such change to the ongoing trend regarding house prices, with the rise continuing to accelerate. The property market has in fact made its strongest start to a year since 2005, with annual house price growth rising to 11.2%, according to the UK’s largest building society, Nationwide.
Nationwide has also detailed that the average price of a home reached £255,556 in January, an increase for the sixth month in a row. The annual growth rate accelerated 0.8 percentage points from 10.4% the previous month, reaching its highest level since the start of last Summer.
Following a strong start to 2022, the question is whether this upward trend is likely to continue…
According to reports at the end of 2021, the housing market was on track to record the highest level of sales since 2007, with an impressive 1.5 million properties sold during the year. In addition to this, the continued increase in house prices is showing no signs of relenting, shown by RightMove’s recent report that asking prices for homes coming on to the market in Britain rose by a record 2.3% in February.
So, how much longer can we expect this prolonged peak to last? Personally, I don’t think we’ve seen the end of this ‘buying boom’. While the majority of those desperate to move will have done so, there are still a whole host of buyers primed to place offers as we go into the New Year. Indeed, research by Zoopla suggests that more than a fifth of households plan to move over the next 18 months.
I think we will continue to see a steady stream of families ‘head for the hills’ as the pandemic pushes more people to reassess what they require from their home, linked to a reduced importance of being based within a commutable distance to the workplace. As an aside, it will be interesting to see how Government’s react to this mass migration, as there is a renewed importance attached to implementing adequate technology and digital infrastructure to ensure that these more remote, picturesque areas remain connected.
As predicted within our end of year review , we have already seen an increase in mortgage rates with the Bank of England increasing its base rate to 0.5%, following an extended period of time when it remained at 0.1%.
This will make it more expensive to borrow money once again. As for house prices, the bad news for many is that I believe they will continue to rise. While we may have come to the end of the ‘frenzy’, there is still a notable shortage in certain property types, which will naturally drive up the asking price.
After an intense year or so, and without the range of incentives from governments and lenders on offer, I’d expect to see a more steady market as 2022 progresses – although I’m sure I said the same about 2021. Whatever we face over the next 12 months, our team are ready to offer their support and guidance.
If you are looking to buy or sell your property, give one of the friendly, experienced Residential Property team at Harding Evans a call on 01633 235145 or 02922 676819 – or get a quick conveyancing quote at www.hardingevans.com/services/residential-property
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