Predictions, on the one hand, sometimes come true, and on the other, they don’t. The property market estimate for 2021 was quite pessimistic, yet see what occurred! There was a boom, and it’s still going strong. Looking ahead to 2022 and the different factors that could affect the housing market, the forecast is for it to remain stable, if not somewhat higher than in 2021. This is something that property specialists, especially Sittingbourne estate agents, are looking forward to. Properties for sale in North Kent and elsewhere in the region are likely to do well as a result of the region’s economic boom.
We take a look at some of the factors that may have an impact on the housing market.
The epidemic shifted people’s priorities in terms of where they should stay. With individuals being restricted to their houses and working online as a result of the lockdowns, more spacious housing became a trend, with additional rooms for office space and an outdoor area being a requirement, whether for a garden or a place to relax. As a result, many individuals have relocated from congested city areas to the suburbs and rural areas.
People are now more wary of confined environments such as apartment complexes, particularly since the breakout of the highly contagious Covid-19 virus. As a result, the need for more large independent housing began to grow. Despite the fact that the lockdowns are finished, and some individuals have returned to their offices, the healthier environment of separate and larger housing remains appealing. As a result, the housing market is more optimistic.
When supply is insufficient to fulfil demand, both the requirement and the price grow. This is comparable to the real estate market. Demand significantly outnumbers supply, resulting in a stampede for property and, as a result, a rise in prices.
Unexpected savings: Because of the lockdowns, which forced the closure of so many facilities, spending on non-essential items like random shopping, entertainment, eating out, and vacations were limited. This resulted in some unexpected savings, which came in handy for some folks who were trying to buy their first home. Price-to-earnings and repayment-to-earnings ratios: The furlough programme guaranteed a significant amount of the employee’s salary. As a result, while taking into account the repayment/income ratio, affordability was achieved.
Prospective buyers have benefited from the 95 percent loan-to-value mortgage scheme, which the government has implemented. Other low-interest mortgage offers have emerged, making it easier for customers to take advantage of them and pay the needed deposit.
- Return on Investment: Professional investors will hunt for opportunities in “developing locales,” where demand is expected to increase over time. At the same time, they will look for properties in such areas that are reasonably priced. As a result, their return to yield will be guaranteed.
- Foreign investment: The immunisation campaign was a success, and some international travel restrictions have been relaxed as a result. Foreign investors have traditionally been drawn to the UK housing market, and this trend is expected to continue for the rest of this year and into 2022.
House price inflation has been spreading across the United Kingdom, with the exception of London, which has stayed relatively constant. The impact of the SDLT vacation was not as noticeable in London as it was in the rest of the country due to higher pricing levels. However, with a return to normalcy insight, the London housing market appears to be on the mend. This will be beneficial to the real estate market.
With the Stamp Duty Land Tax vacation fading out and closing on October 1, 2021, there is likely to be a drop in property purchases.
Lower incomes: As the furlough programme expires at the end of September 2021, monthly incomes are likely to fall. Furthermore, until the economy stabilises, unemployment is likely to rise. This will have an impact on property purchases.
Low-interest mortgages: While this in and of itself is enticing to purchasers, keep in mind that the lower the mortgage interest, the greater the property price. As a result, cheap financing plans may result in extravagant house prices, deterring potential buyers.
With the free movement of people between the UK and the EEA (European Economic Area) being restricted, there is expected to be a decrease in the demand for properties in those locations.
With the above advantages and negatives affecting the UK housing market, it is impossible to make a definitive prognosis. However, it appears that the real estate industry will continue to thrive. The “bricks and mortar” investment has proven to be resilient in the face of all storms thus far, and it appears that this trend will continue. However, only time will tell, and we eagerly anticipate what the property market will deliver in 2022.