House Prices Are Falling in 2022
As always August ushers in the summer holidays and for the first time since the beginning of the pandemic, people are once again able to go on a sunny getaway again without worrying about travel restrictions.
You may well ask- “what does that have to do with prices for houses?”. Well, usually people will delay moving until they have returned from their summer holidays. Therefore, it stands to reason that – because of fewer properties for sale and fewer homeowners planning to move – there tends to be a seasonal drop in house prices around this time of the year. And things are no different in August of this year as witness the decline in house prices.
Over the past couple of years, the average price for homes in Great Britain has fallen by almost £5,000 to £365,173. This represents a 1.3% drop which brings it on par with average seasonal drops in August during the past ten years.
Property expert Tim Bannister says this is not surprising as the summer holidays are in full swing again and the housing market is returning to its normal seasonal patterns after two busy years.
Some estate agents are recommending that sellers hold off putting their homes on the market until September. They have pointed out that after a prolonged period of many people’s lives being restricted in terms of travel and holidays, it was felt it would be in the best interests of their clients to market their properties outside the month of August in particular so that the maximum number of buyers could be engaged when properties are launched in September.
Want to Move House by Christmas?
Christmas time is another seasonal event that is already affecting the way some people are pricing their homes. At present, it takes about four and a half months or 136 days to complete a sale and with Christmas on its way, sellers who wish to celebrate the festive season in their new home this year will be hard-pressed to find a suitable buyer for their existing home quickly. This means that we will see some houses being priced more competitively. Kariba Properties offers housing at an affordable rate.
Have Rises in Interest Rates Affected House Prices?
Fresh in the minds of many potential home-movers will be the 6th consecutive rise in interest rates this year, this time rising by 0.5% to a rate of 1.75%. Although they don’t have a significant impact at the moment on the number of homeowners wanting to move, the effects will most likely filter through gradually during the rest of this year.
Right now there is a mismatch between the number of homes available and strong levels of buyer demand that will be the most important factor influencing house prices outside of the seasonal trend.
Will House Prices Continue to Fall During the Rest of This year?
While buyer demand has eased off compared to an exceptionally busy 2021 market, enough of an imbalance exists to prevent any significant price falls for the rest of this year.
Traditionally the autumn months are busy periods for the housing market with potential price rises as people prefer to move into a new home before the festive season starts. As we head into December prices will tend to cool down again.