In the coming years, the UK housing market will likely change dramatically. This is primarily due to various factors, such as Brexit and changing demographics. With that being said, it’s difficult to predict what will happen with British housing prices in the next few years. We have seen a sharp rise in properties being bought by international investors and funds in the last few years, meaning that the future of housing prices could be very different from what they are now. Here is everything you need to know about what will happen to house prices in the UK.
House prices are expected to fall in 2023
One of the most reliable indicators of where the housing market is heading next is the Halifax House Price Index. This is a monthly survey of the British housing market where they look at the average house prices of different regions. There has been a slow but steady decrease in average property prices in the last few months. The expectation is that this will continue over the next few years. The Halifax House Price Index data shows us that average property prices are expected to fall by around 10% from now until 2023.
The Bank of England base rate will increase.
The base rate is the interest rate that the Bank of England increases or decreases based on the health of the British economy. The base rate has increased by 0.75% to 3% in 2022. This will likely slow down the rise in housing prices in the next few years. This means that the best fixed-rate mortgage in the UK is expected to be 6%, increasing the cost of borrowing for homeowners across the country.
Demand for home buying will fall.
The number of people buying property in the UK has been rising for the past few years, but it is expected to slow down over the next few years. When the interest rate increases, the cost of mortgages will go up. This will mean that more people will not be able to afford to buy a home. This will likely reduce the number of people buying property in the next few years. This could have a significant effect on the British housing market. It will be difficult for the housing market to grow when more people rent than buy homes. If the number of people buying homes decreases enough, we could start to see a significant reduction in the value of British property. If the number of people buying homes continues to decline, we may see the value of British property fall below the current average price.
Lenders will tighten the criteria.
With the rise in property prices, more and more people have been able to borrow money to buy homes. This has led to a rapid increase in the number of people taking out mortgages. Lenders have been incredibly lenient when approving mortgages in recent years. However, lenders will likely tighten mortgage criteria over the next few years. This is likely to cause a decrease in the number of people taking out mortgages. This will make it much more difficult for people to get a mortgage. If you want to improve your odds, it can be beneficial to work with an expert mortgage broker to give you the best chance of success in this changing market.
All in all, there are plenty of reasons to believe that the UK housing market will change in the coming years. It’s unclear exactly how things will change, though, and it’s difficult to predict what will happen with British housing prices in the next few years. With that being said, house prices will likely fall, and fewer people will be able to get a mortgage. Whether or not this is a good thing depends on who you are and your personal situation.