UK’s housing market is to slow dramatically in 2022 as borrowing costs rise and household budgets come under mounting strain, property experts have predicted. After a year of booming prices driven by stamp duty holidays across the UK and changes in the types of properties being bought and sold, forecasters typically suggest house price growth of between 3 and 5% next year. The most recent figures from Nationwide building society showed annual price growth running at 10%.
In London’s wealthiest boroughs, however, price rises are expected to outstrip those recorded this year and could beat the figure for the UK as a whole.
The property website Rightmove has predicted house prices will rise by 5% nationally and 3% in London. Zoopla, a rival site, expects 3% next year and forecast 1.2m transactions, down from 1.5m in 2021 but in line with the average number of transactions over the last five years. Robert Gardner, the chief economist at Nationwide building society, has not put a figure on how much he expects prices to move in 2022. He said: “The outlook remains extremely uncertain. The strength of the market surprised us all in 2021 and could do so again next year.” - Guardian
Borrowing costs, however, are still lower than before the pandemic, and analysts believe any future rate increases will be limited because it appears far from over.
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