As we stumble into 2022, there is a certain degree of uncertainty about how things will play out in the property market this year. Before the Omicron virus variant emerged, sources were confidently predicting that the availability of homes would increase early on in the year, now that the market surge caused by the stamp duty holiday has abated. Although we may still see a rise in early 2022, the experts are obviously now less confident in their predictions.
According to Property Wire, Supply is one of several useful measures they will use to assess the trajectory of the UK property market In 2022. Here are the other factors and how they might impact the market this year:
Continued house price growth
Sellers were starting to become more active towards the end of last year. According to Knight Frank Estate Agents, the number of UK sales instructions in the last two months of 2021 rose by 7% versus the average for this period between 2015 and 2019. Market valuation appraisals – one of the leading indicators of housing supply – were up by 10%.
Ability to respond to uncertainty
The main impact of lockdown on the market were the levels of uncertainty that it brought with it. Home buyers and sellers needed the confidence to plot their next move without the prospect of any disruption to their plans and this really affected the market.
Buyers who are able to act quickly this year will benefit the most from any unexpected changes and Property Wire suggests that for those who are more cautious, spring will be a better time to sell.
Whatever happens, demand is still very strong at the moment. The number of new prospective buyers in the UK during the final two months of 2021 was 63% higher than the average between 2015 and 2019.
Another key factor which could impact market growth this year is of course the cost of borrowing and experts predict this could cause demand to slow later in the year:
“Normalising interest rates are a sign the economy is getting stronger but as mortgage rates also normalise, this will inevitably dampen demand and price growth. However, it should be remembered that the current base rate of 0.25% is below the level of 0.75% in March 2020, which was still considered historically low at the time.”
Property Wire predicts that these will not make too much of an impact and will serve more as a ‘dab on the brakes’ than bringing the market to a grinding halt. Although there are some concerns about the rise in inflation which could reach as much as 7% this year. Pile this on with the predicted rise to our cost of living and demand for property could very well decrease, causing prices to fall.
International Travel and Overseas Buyers
The potential return of international travel will also affect the property market as overseas buyers begin to turn their attention towards the UK once more.
Although many travel rules have been relaxed, experts predict that due to seasonality and the erratic path to recovery in different parts of the world. International demand may only recover more noticeably in the second quarter of the year, unless of course any new, dangerous variants emerge in the meantime.
As long as these factors remain relatively stable, then Property Wire suggests that the property market will remain strong over the next 12 months.
Ready to make your move in 2022? Why not give us a call to see how we can help with a free, no-obligation quote? If you need to store some stuff during the sale or the move, we have secure, stone-built storage facilities right here in the centre of Bridport. We can help you to pack your things and put them straight into storage for you until you’re ready to deal with them, taking all the stress out of moving for you. Give us a call to find out more.