We’ve seen big rises in house prices over the past few years, as pandemic-inspired lifestyle changes and the Stamp Duty Holiday encouraged more and more of us to move home.
Understandably, rising interest rates and big increases in household bills have now led to a slowdown in the property market. As 2023 begins, there are plenty of headlines proclaiming that UK house prices are forecast to fall: but the big question is, by how much?
We Oakland Estates, the Ilford estate agents have looked at a range of housing market forecasts to see what the experts are predicting for the property market this year.
What happened to house prices last year?
Prices rose for the first eight months of 2022 as the home-buying boom of 2021 continued. Land Registry figures show that in the 12 months to October 2022, average house prices rose by 12.6%.
More recently, updates from Rightmove, Halifax and Nationwide have recorded month-on-month falls in property values.
What can we expect from house prices in 2023?
Rightmove predicts that average house prices will fall by 2 per cent this year, while Nationwide predicts a 5 per cent drop.
Home buyers will no doubt welcome these price reductions, but a shortage of properties coming onto the market makes it unlikely that we will see a property crash. In November, the estate agent trade body Propertymark reported that its members saw an average of 33 properties listed for sale per branch. This compares to an average of 51 sale properties listed before the pandemic.
If, as Rightmove predicts, we see a fall of just 2 per cent, that leaves prices at a higher level than the figures recorded during the home-moving boom of 2021. Rightmove has also said that in the next year, some areas may ‘outperform’ average price forecasts.
Will higher interest rates affect house prices in 2023?
Economic issues at home and abroad have driven up interest rates, resulting in more expensive mortgages. In December, the Bank of England raised the interest rate to 3.5% (the highest level since 2008) as part of an ongoing battle to prevent double-digit inflation.
However, some experts believe that inflation may be close to – or may even have reached – its peak. According to the consumer platform Which? Some of the cheapest mortgage deals have now begun to dip below 5 per cent.
This is good news for buyers, as it shows that the market is beginning to stabilise. However, the Bank of England hasn’t ruled out further rate rises. We’ll know more after 2nd February when the Bank meets to discuss whether a further rise is needed.
What are your plans for this year?
Our estate agents in Barkingside, Ilford have seen a busy start to the New Year, with realistically-priced flats and family homes still proving popular with homebuyers.
Are you planning to move this year? Why not give our friendly sales teams a call? If you are looking for an affordable mortgage deal, we can put you in touch with a mortgage broker who can help.
Give us a call at 0203 972 7341 or email info@oaklandestates.co.uk.
Properties for sale in Barkingside and Ilford
Properties to rent in Barkingside and Ilford
Don’t forget to follow our socials for the latest property market advice and listings:
https://www.facebook.com/Oakland-Estates-1426149597689066/?fref=ts
https://twitter.com/OaklandEstate
