UK housing market forecast for 2022? Busy, but less frenetic

Posted on 9th of Feb, 2022

The UK’s housing market is likely to return to more normal levels of activity in 2022 but will still be busy, with strong buyer demand carrying forward into next year and a rebound in the number of homeowners apparently getting ready to sell, according to Rightmove.

The property website said that following a “frenzied” 18 months, the market was heading for a “less frenetic” period, with a more even balance between buyers and sellers as more homes are put up for sale and higher interest rates take some of the heat out of buyer demand.

It said one sign of a return to more traditional conditions was its finding that the market had experienced its usual “December dip”, with the average asking price of a home falling by 0.7% – or £2,234 – over the past month.

However, this UK-wide figure disguises regional variations: in London and Scotland typical asking prices have fallen by more than that – by 1.6% and 3.5% respectively – but in other regions such as the East and West Midlands, they rose by up to 1.6% over the past month.

Separately, UK Finance, the bank trade body, said a strong year for sales would make 2021 a record year for mortgage lending.

It predicted that gross mortgage lending would peak this year at £316bn – up 31% on 2020 – then fall back to £281bn in 2022 before increasing to £313bn in 2023.

However, it added that mortgage arrears were expected to be 26% higher in 2022 than this year, hitting 102,000, compared with an estimated 80,800 in 2021, while home repossessions were forecast to climb by 267% to reach 7,700 in 2022, compared with an estimated 2,100 this year.

Its data follows a string of surveys that have depicted a property market that is continuing to defy many expert forecasts. Last week, the Halifax issued figures showing that average UK house prices rose by 3.4% in the three months to the end of November, the highest quarterly rate since late 2006. Rival lender Nationwide said prices continued to climb in November and were now 10% higher than a year earlier.

Original article: https://www.theguardian.com/business/2021/dec/13/uk-housing-market-forecast-for-2022-busy-but-less-frenetic