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Gumersalls News

Property Market Boom Continues In 2022

by | Feb 18, 2022 | News | 0 comments

The active UK property market has continued to thrive in the first month of 2022, The Guardian reports. The building society Nationwide reports that average house prices have continued to rise for the sixth consecutive month, reaching £255,556.

Robert Gardner, Nationwide’s chief economist, said: “Housing demand has remained robust. Mortgage approvals for house purchase have continued to run slightly above pre-pandemic levels despite the surge in activity in 2021 as a result of the stamp duty holiday, which encouraged buyers to bring forward their transactions to avoid additional tax.”

He added: “Indeed, the total number of property transactions in 2021 was the highest since 2007 and around 25% higher than in 2019, before the pandemic struck. At the same time, the stock of homes on estate agents’ books has remained extremely low, which is contributing to the continued robust pace of house price growth.”

However, as the UK grapples with the steepest rise in the cost of living for 30 years, experts predict that eventually this will impact on the housing market. The Evening Standard reports that first time buyers in London may be particularly hard hit by the economic turbulence.

The Standard explains that when mortgage rates rise, as they have done recently, there is normally a corresponding drop in house prices. However, the momentum for buying property that gathered pace during the pandemic shows no sign of abating, and there remains a shortage of available housing stock.

This means that buyers will be faced with the prospect of higher deposits, and larger monthly mortgage repayments. Although mortgage rates are still relatively low, the financial squeeze caused by rocketing inflation and energy bills may mean that challenges are ahead for those looking to take their first step on the property ladder this year.

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