Property Market in 2022
We’ve arrived in 2022 and many will be anticipating what’s to come for the property market in 2022. Last year was rather frantic with demand for property at an all time high, Stamp Duty Tax – Waiver to end!, very low interest rates and cheap mortgages.
Property traders and first time buyers will find it easier to source property in a less frantic market, especially with the current Omicron pandemic upon us.
The way in which people work has changed dramatically thanks to the pandemic and this is one development that looks to be here to stay.
This means the demand to move into larger properties, ideally those with room for a home office, which are found outside of cities, is likely to continue growing.
At the same time, with rumours of further lockdowns circulating, if these do happen it could also see those able to work from home being able to save more money, which could then be used for property purchases.
On the other hand, for millions, buying a house could be completely out of the question, even more so than in the past 18 months. With no extra government support currently for employees or businesses impacted by the virus, many will see their incomes squeezed to breaking point.
Rising inflation, which hit 5.1% in November 2021, is putting extra strain on our finances and it could lead to fewer house moves, pushing activity back to a more normal level.
It is combined with a period of historically low interest rates, only raised to 0.25% (previously 0.1%) in the latest Bank of England’s decision.
But while borrowing remains relatively cheap, making it more affordable to take on a new mortgage, it’s unclear just how long this will last for. The Bank of England has said it expects base rates to be hitting 0.75% by the end of 2022.
Consumer confidence, due to rising prices on everything from food and travel to energy and mortgages, could also take a knock and this may slow down the housing market in 2022.
A major factor in the price rises of the last 18 months was the stamp duty holiday. Unless something similar is announced, which isn’t expected, 2022 should be a relatively normal year in terms of house prices.
What are your thoughts on the property market in 2022?