Since the effective shut down of the market in the 2020 lockdown, the residential property market has gone from strength to strength. Changes to lifestyle choice brought about by the lockdowns are cited as a driver for the increases in prices, with gardens, sea views and countryside becoming the trend and pokey city flats falling behind. Nevertheless, increasing prices has been seen across the board.
Commentators have long forecast a dip in the market, never more so than in recent months given the increases in interest rates, inflation and the cost of living crisis.
The events of this week, with mortgage rates jumping up and some lenders pulling out of the market, is widely expected to impact the market. Some analysts, as of this week, are suggesting 10-20% drops in house prices.
We will learn the outcome of current events in the coming weeks and months. During 2022 thus far the market has sustained, although agents are reporting fewer enquiries at present. The latest house price data shows July having a 15% increase in average house price in the South East year on year. Predictions are for sustained strength at the higher end of the market where buyers are less susceptible to the cost of living squeeze and borrowing but a weakening at the lower end.
In their mini statement, the government has announced the removal of the lowest band of SDLT plus additional relief for first time buyers. Time will tell if this measure buoys the market.
With surges in build costs recently, the developer market is increasingly competitive. Interest in residential development sites remains strong, with developers tightening their profit margins.
Forecasts are difficult but the wide expectation is for a more volatile market going forward. Property valuation is more important than ever. Graves Jenkins provide a wide range of residential valuation services including valuations for: site appraisals, accounts, settlement, Shared Ownership sales and staircasing, leasehold extension, Help to Buy Loans and Affordable Housing assessment. Please contact Tom Neal phone email for details.
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