Monitoring the housing market is very important for many, particularly those doctors and dentists who are looking to purchase their first home or who are investing in buy-to-let properties. Our monthly Property Price Update gives you a summary of what the experts are saying.
This article does not constitute advice. Professional advice should be taken prior to acting on any part of it. Your home may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it.
What’s going on in the UK Property Market?
During the first month of 2022, annual house price growth increased from 10.4% in December to 11.2%, a monthly change of 0.8%. It was the strongest pace since June of last year and the strongest start to the year in the last 17 years.
The average house price in January was £255,556, up slightly from December’s £254,822.
Despite worries about how the housing market would perform in the new year, housing demand has remained strong. Mortgage approvals remain slightly above pre-pandemic levels even after the Stamp Duty Land Tax (SDLT) holiday ended. The SDLT holiday was the reason for 2021 bringing in a record number of property transactions – 25% higher than 2019. However, there aren’t many homes on the market, which is what is contributing to the strong pace of house price growth.
Predictions for the year
As always, it is quite difficult to predict how the market will perform in a given year. But according to experts, it is likely the housing market will slow down in 2022.
Homes are starting to become hard to afford thanks to house price growth outpacing earnings growth and deposits and monthly payments are starting to skyrocket. Combined with the pressure cost of living increases is putting on the average household, the lack of affordable homes available will pretty much ensure a market slowdown.
With inflation hitting 5.4% in December, more than twice the Bank of England’s target of 2%, and no end in sight to the factors contributing to inflation such as the energy crisis, consumer confidence has plummeted.
COVID impact
One piece of good news, however, is that many do not believe the Omicron variant will have a significant impact on economic recovery. That does mean that interest rates are expected to rise even more over the next few months. Unfortunately, this will impact mortgage rates and very soon consumers will bear the brunt of the increases.
Check back next month
There’s never been a more important time to keep an eye on the market and the changes from month to month, so be sure to check back monthly for all the updates on the UK property market.
Figures quoted from Nationwide House Price index January 2022.
Mortgages for Doctors and Dentists
Always remember to visit our site monthly for your regular update on the nation’s property prices.
If you’re planning to buy or sell property this year contact an advisor for personalised advice.
At Dental & Medical Financial Services, our experts are dedicated to helping our clients select the right mortgage deal for your needs. If you’re ready to take the first step toward home-buying, get in touch with us today.