Is 2022 A Good Time To Invest In The UK Property Market?

Is 2022 A Good Time To Invest In The UK Property Market?

The future looks good, but that may be for homeowners who invested prior to the pandemic than for investors who are looking to invest in homes for the rest of 2022. The old adage is buy low and sell high may be from the stock market, but it applies to the real estate market as well.

You want to be able to buy at the right price so that if any downturn occurs, you will not lose a lot of money. So far, the predictions for the UK real estate market through 2025 look good.

While you may not make a lot of money, 2022 is still shaping up to be a good year to invest in flats, homes, and terraced properties. Even rental income looks to remain strong in the short term.

UK House Price Predictions For the Next 5 Years

So far, 2022 has been a surprise year as it has surpassed the 5.6% estate price increase for different homes in the country. The first half of the year saw great financial success in terms of rising home values and prices.

The last half is now predicted to add another 3.5% growth on both of those items. That is a total of 9.1% increase over 2021. The next few years’ predictions may not be as strong as this year’s performance.

But factors look good for 2023 as an additional 1% increase is forecast for next year, with a 2% forecast for 2024 and for 2025. In the year 2026, the forecast is for an additional 3% increase over the previous years.

There are no figures for 2027 as of yet. But the future is hard to predict, and it remains to be seen if these predictions come to pass, fail to be met or surpass the predicted increases.

As for rental income, the prediction is for landlords to see a cumulative increase of 17.1% in rental prices over the next 5 years, which includes figures for 2022. The per year increase is- 4% for 2022, 3.5% for 2023, 3% for both 2024 & 2025, & 2.5% in 2026.

So right now, it is good news for investors if they want to invest in property in the remaining months of 2022. One reason for this increase is that demand for rentals outstrips the supply of rental homes.

Is A UK House Price Crash Coming

Nothing lasts forever, and it is hard to predict the future. Some experts have said that it is possible a huge housing crash could come in the next several months.

The factors these experts rely on involve the government and tax cuts. Although those tax cuts action has been rectified, the experts making this prediction have not changed their minds.

Other experts say that if the supply is greater than the demand, then values can drop immensely and cause a crash. But they are also hedging their predictions and state that it won’t happen in the next several months.

The latter experts feel the UK is in a housing bubble fueled more by demand than by actual home value. Given that in 2021, homes, etc., sold for an average of £22,000 above the actual list price, there may be cause for concern.

Right now, demand remains very high, so there is nothing that will fuel a crash unless that demand disappears rather quickly. Another factor in this possibility is if the Bank of England raises interest rates again.

Right now, it is sitting at 2.25%, and if it goes higher, many people may not be able to afford their monthly mortgage payments. This will impact homeowners who won’t be able to find anyone to buy their homes.

Is It Time To Invest In Property

This will depend on who you talk to. Some experts think this is a good time to buy as home values are predicted to rise for the next 4 years. It is better to buy now, so you do not spend more money next year or the year after.

If you wait for the bust, it may never come, and you lose out on some potential profits due to the failure of the bust to appear. Some experts also point to the fact that right now, it is a seller’s market.

That means that there is more demand than there are houses for sale. Owners can name their prices and expect to receive offers far above that asking price. However, the end of October seems to be the benchmark in this situation.

At that time, the Stamp Duty holiday comes to an end, and there will not be as many buyers rushing to meet that deadline. Some experts expect housing prices to fall in the post-deadline era, which makes that a better time to buy than pre-November 2022.

If you are looking for an investment property, it is better to wait till you see if the market dips a little before making a purchase. When it comes to investing in property, it is not just location that is important. Sometimes it is when it is the right time to buy.

If you can afford to wait for a buyer’s market, then a delay may be an option. You want to get the best price, and overpaying is not in the best interest of any investor.

Some Final Words

Is 2022 the best time to buy right now? If all goes according to the predictions, then the answer is yes. You should not wait till prices increase next year to buy your home or investment property.

If you are not sure when is the best time to buy, then call our office. Our company has over 10 years of real estate buying and selling experience. We can help you study the facts and figures to see when is a good time for you to make your next purchase.

Give us a call today so we can help you more quickly.