House Prices Go Down For The First Time In 2022

The pandemic-era travel restrictions are gone. This is the first summer holiday season after the pandemic when people will be able to travel to their favourite sunny getaway without any kind of restrictions.

You must be wondering what is the relationship of all this to house prices. The thing is that most people who are planning to move usually plan to move once the summer holidays are over. It also means that there are fewer choices on the market as there is lower demand, and this results in a seasonal drop in house prices.

The August summer season this year is behaving exactly the same and it is the first time of the year when prices have gone down.

In Great Britain, the average asking price for a home currently stands at £365,173 which is almost £5000 less or a drop of 1.3%. This drop is in line with the average drop in prices witnessed in August over the past decade.

Tim Bannister who is our in-house property expert says that the fall in prices is all right and is due to the summer holidays effect. Also, the past two years have been really busy and the housing market this year seems to follow the expected seasonal patterns.

There are also real estate agents who are recommending people to not put their homes for sale and wait until September. Kariba Properties is one of the best estate agents who is always helping to guide you to sell your house with a good profit.

Jordan Yorath who is a partner at the Monroe Estate Agents based in Leeds is also recommending the same. He says that people were dealing with a lot of restrictions on holidays and travel for the past two years and this is why homeowners should wait until the month of September to list their properties on the market.

It should allow them to increase their reach as that is when buyers are expected to come back to the market. He also says that their agency has been making preparations for the remaining year and from September onwards should see a good number of listings.

Planning to Move in by Christmas

Christmas is also a seasonal event that is affecting the pricing of homes. Currently, the time taken for closing a property sale is around four and a half months or 136 days.

Home sellers looking forward to celebrating the festive season in their new home would want to find a suitable buyer quickly and it should result in some competitive house prices.

Effect of Interest Rates on House Prices

The interest rates have continued to rise. The rates have risen 6 times continuously going up from 0.5% to 1.75% and it will always play in the minds of potential homeowners.

The rise in interest rates is likely to filter through during the remaining part of the year but as of now, the rise in interest rate doesn’t seem to have any effect on the number of people looking to move.

While seasonal trends always affect house prices, currently the biggest influencing factor is the mismatch between the number of available homes and strong buyer demand.

How the House Prices Expected to Move This Year?

2021 was an exceptionally busy year and the buyer demand is a bit lower as compared to the high levels of 2021 but the prices aren’t expected to fall considerably due to a mismatch between the demand and supply.

The housing market has always been busy in the autumn months leading to a rise in prices as people want to move into their new homes before the year-end. As we move into the summer and festive season, prices are likely to go down again.