Will House Prices Continue to Rise in 2022?

In more than a decade or so it appears that house prices have an impenetrable shield against any and all outside attacks be it from Brexit to the global drive of Covid19 lock downs and hits on the economy. Just when you think the news and current climate will suddenly cause a crack in the property market, it continues to drive forwards adding %’s to the average house price and the distance between first time buyers and their ability to walk over the threshold.

Housing market has had the best start to a year in nearly two decades!

Is it just all down to supply and demand? The population of the England continues to rise (currently at 55,550,000), approximately 250,000 to 350,000 added per year yet, this figure is somewhat higher then the approximate 200,000 to 250,000 new homes built each year. Though with the average household size in the UK is 2.4, then we can say the stock being built each year is more than adequate to cover the growing population. It would appear that in deed the supply is the issue that is not covering the demand, new builds will not accommodate all people’s requirements and it is the middle ground, middle class, of property that is scarce.

It the recent year or so of the covid19 situation we have seen city office workers given the chance to work from home which has fuelled the desire to leave the premium priced central urban locations to those property away from it all (London saw some decreases in house prices during covid19). The need to live next to main travel routes is replaced by a desire to have extra bedrooms, a small pad with low maintenance is not so appealing as a large gardens with your own veg plot and the ideal location goes from a stones throw away from the office to being that perfect rural / seaside location.

Rightmove themselves forecast an increase of property prices in 2022 with their feedback on the hectic market of the last 18 months:

This is because we’re still seeing a huge number of home-hunters looking to move, and not enough homes available to buy, so the imbalance continues to push prices up.” source Rightmove

Zarah Sultana MP Tweet

Zarah Sultana MP Tweet

 

Inflation and interest rates increases are in full swing now which could effect the house price index especially if the pinch is going to be felt by a growing volume of the population. The on going attack from the current government to punish everyday working people continues, the rich to get richer and the middle class to dissolve down to poor working class status. Fuel bills are forecasted to rise from around £1,250 to £2,000 annually yet Rushi Sunak has looked to hand bankers a multi-billion pound tax cut.

Councils buying up lower end housing stock for their private rental sector is also causing a lack of homes for sale especially at the lower end of the market. A further push against people owning their own homes (apartments to typical three bed semis) whereas we see a growing chronic shortage of larger properties.

My predictions for 2022 housing market in England:

There is much disdain for the current government from their handling of covid19 to illegal immigration, the prime minister has a more or less vote of no confidence from many. Yet those who could replace him, them from fellow conservative MP’s to the shadow government, do not leave people with any further optimism in fact probably less than the shower currently in charge. From changing of human rights acts to involvement in the so called conflict with Russia regarding Ukraine, there is a lot of tension and should patience wain from the paying public then we could see a dampener on the housing market especially urban locations. Higher demand, larger and better location property outside of prime city hotspots between £400,000 – £1,000,000 will survive and either maintain or increase in value.

If the chains of covid19 (despite a chalk and cheese approach across Europe) are released and it is back to business as usual then a mini boom could occur benefiting commercial real estate and certainly small to medium sized businesses. This will bolster the property market and give a small 5% year on year increase.

Further lock downs on future (predicted) strains of covid19 could see a collapse of small to medium sized businesses (especially if furlough is not re-introduced). This would cause an influx of defaults and thus repossessions so lower house prices and to what negative % will depend on the volumes hitting the market.

Summarise:

  • Rural / Seaside location larger properties to increase
  • First Time Buyer property to increase
  • Premium city property to level
  • Luxury City property to level/increase

 

Title image: Pixabay

Christopher Walkey

Founder of Estate Agent Networking. Internationally invited speaker on how to build online target audiences using Social Media. Writes about UK property prices, housing, politics and affordable homes.

You May Also Enjoy

Breaking News

Freehold and Leasehold Reform Act-lessees can control their own destiny

Matthew Pennycock, Minister of State for Housing and Planning, has made a Parliamentary Statement regarding the future progress of the Freehold and Leasehold Reform Act 2024. The Government have formally recognised the “significant complexity of the task” and that the legislation was rushed in at the end of the last parliament and as a result…
Read More
Rightmove logo
Breaking News

Rightmove’s weekly mortgage tracker 22/11/24

The current average asking price of a typical first-time buyer property is £225,340. For someone taking out an average five-year fixed, 85% LTV mortgage, the average monthly mortgage repayment on this type of home is now £1,104 per month if repaying over 25 years, compared with £1,138 per month a year ago (when the average first-time buyer property asking price was…
Read More
Estate Agent Talk

The Architecture Of Attention Behind Social Media Addiction

In the digital age, social media platforms have revolutionized how we connect, share, and consume information. Behind their sleek interfaces lies a sophisticated architecture of persuasive technology.  These platforms employ intricate design patterns and technical elements to capture and hold user attention. From subtle visual cues to complex algorithmic systems, every feature serves a calculated…
Read More
Breaking News

2025 Predictions for the Private Rental Sector

Allison Thompson, National Lettings Managing Director, Leaders Romans Group (LRG) “As we approach 2025, the lettings industry is entering a phase marked by stabilisation and opportunity. Rental inflation has slowed to an average of 3-4% for new lets, reflecting the effects of affordability constraints; renters’ budgets are beginning to limit how much rents can rise.…
Read More
Breaking News

Response to Matthew Pennycook’s Statement on Leasehold Reform

Yesterday, Secretary of State Matthew Pennycook made a Ministerial Statement on the future of leasehold reform. Responding, Mark Chick, director of ALEP and a Partner at Bishop & Sewell LLP said: ALEP welcomes the ministerial statement which puts in place a timeframe and some objectives for the implementation of the Leasehold & Freehold Reform Act.…
Read More
Estate Agent Talk

Essential Garage Storage Solutions for Small Spaces

Maximize your garage space with practical storage ideas that keep your items organized and accessible. If you’re dealing with a smaller garage, smart solutions can make a big difference in keeping your space neat and usable. 1.  Wall-Mounted Storage Wall-mounted storage is an excellent way to save space and keep your garage organized, especially in…
Read More