Latest: House Price Crash News

Monday, May 16 2022 Add a News Blog Article

May 2022 R.I.C.S Report

1/3 of Estate Agents Think House Prices Will Be Lower

"Turning to the outlook, contributors envisage prices rising further both in the near term and over the year ahead. On a twelve month basis, a net balance of +62% of respondents foresee prices continuing to increase, broadly in-line with last month’s figure of +65% for this series, but a little more moderate than the +78% reading posted back in February."

Posted by Data Dave @ 03:05 PM 0 Comments

The Guardian gets bearish

How long can UK house prices defy gravity?

House prices have been supported by low borrowing costs, so rising mortgage rates, combined with other increases in living expenses, could tip the balance.

Posted by Data Dave @ 04:30 PM 1 Comments

Halifax HPI: Average Price £286,079 +1.1% MoM +10.8% YoY

Rate of house price growth still expected to slow as incomes squeezed

At the current rate of growth, it raises the prospect of a typical home hitting £300,000 by the end of this year. However, as outlined above, such a prospect remains unlikely given the forecast economic conditions.

Posted by Old Man George @ 07:45 AM 0 Comments

MPC May Report

BOE Raises Rates to 1%

We expect inflation to fall back next year and be close to our target in around two years. We may need to increase interest rates further in the coming months. But that all depends on what happens in the economy. In particular, we will be watching closely what is likely to happen to the rate of inflation in the next year or two.

Posted by Admin @ 02:56 PM 0 Comments

A litany of political and regulatory failure… Britain’s housing crisis

An overview of the political and regulatory failures that have created Britain's housing crisis.

Posted by researcher @ 08:11 AM 1 Comments

Rightmove April 22 House Price Index

"Homes selling faster than ever in spring market frenzy"

This fastest-ever speed of sale means that 53% of properties that sell are now selling at or over their final advertised asking price, the highest percentage we have ever measured.

Posted by Admin @ 07:04 PM 6 Comments

High levels of buyer and seller sentiment continued unabated in March

OnTheMarket April Sentiment Index (March Data)

"Many of those buyers who hesitated and didn’t make a purchase last year are finding it difficult to afford what they were considering buying previously, such are the price differentials and gains in value over the last 12 months. What’s more, despite double-digit growth in many parts of the country, asking prices continue to rise; our data showed a £12,517 jump in average asking prices between February and March 2022 alone."

Posted by Data Dave @ 09:14 AM 0 Comments

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UK House Prices Graph

The UK average house price is now £276,755. 

  • As of February 2022 the UK Average House Price is £276,755.
  • The House Price Index [HPI] now currently stands at 145.2
  • Property prices have risen by 10.90% when compared to the same month last year and have increased 0.50% when compared to the previous month.

Source: Land Registry

uk average house prices property prices national graph

UK House Price Index

Source website Period covered Average house price Monthly change (%) Annual change (%) Official releases
LSL Property Services & Acadametrics (England and Wales) Apr 21 £341,462   0.70   11.7 April 2021 (PDF)
Halifax House Price Index Apr 22 £286,079   1.10   10.8 Apr 2022
Office for National Statistics [O.N.S] Feb 22 £277,000   0.70   10.9 Feb 2022
Zoopla / Hometrack Mar 22 £249,700   0.50   8.30 Mar 2022
HM Land Registry UK HPI Feb 22 £276,755   0.50   10.9 Feb 2022
Nationwide House Price Index Apr 22 £267,620   0.30   12.1 Mar 2022
Rightmove ‘Asking’ Price Index Apr 22 £360,101   1.60   9.90 Apr 2022

 

House Price Index - Greater London

Source website Period covered Average
house price
Monthly
change (%)
Quarterly
change (%)
Annual change
(%)
Archive /Graph Peak average
house price
Change since
peak (%)
Official releases
HM Land Registry UK HPI Sept 21 £494,673 2.00 N/A 2.20 Tick £530,409
(Jan 16)
6.70 July 2021
Nationwide House Price Index Q1 21 £482,576 N/A 4.8 6.20 Cross Current Quarter (Q1 2021) March 21
Rightmove ‘Asking’ Price Index Sept 21 £638,285 0.40 N/A 0.80 Tick Sept 2021

House Price Predictions

If you have discovered other or revised predictions that you’d like added to this list then send an email to us with all the information for each column and also a link to a website that contains the information so that we can verify the data.

This table is now sorted by the date that the prediction was made.

Source website Analyst Photo Date prediction made Amount predicted Region Time Period Evidence Notes
SP Rating SP Rating Photo of David Orr 2022 Overvalued by 50% UK Not Stated Tick
”SP Rating has stated that London and the South East of England is overvalued by 50%. They further the statement by saying the rest of the UK is overvalued by 20%”

 

uk house price prediction

The outlook at the start of 2021 in terms of restrictions imposed by Covid-19, seems similar to that of March and April of 2020. After further easing of restrictions in 2021 we could therefore see what was experienced after the March lockdown ended in 2020 i.e. a surge in house prices. This was caused primarily by buyers scrambling for more space, both house and garden. 

Flats and maisonettes could stand to make the smallest gains in 2021 whilst larger, detached properties with bigger gardens could again stand to see the most gain.

 

The data also shows that for 10 years average house prices in the UK were above the long term trend line but to date have spent a further 10+ years below it.

 

The data shown in the graph after Q4 2020 has been ‘forecast’ by continuing long term trends and further price rises. It shows UK average property prices could reach £275,000 by the end of 2022, nearly a 15% rise.

UK House Prices to Earnings Ratio

This is calculated by dividing the house price for a region by its earnings. That ratio then serves as an indicator of relative affordability. 

 

A higher ratio indicates on average that it is less affordable for people to purchase a house in their region. On the flip side a lower ratio indicates higher affordability in that region. 

 

Whether something is ‘expensive’ can be very subjective and affordability then plays a key part. Bear in mind, ‘expensive’ to one person might not be expensive to another, so that’s why it’s important to break the earnings ratio down by geographical region. It also highlights regional purchasing power. 

 
uk house price to earnings ratio

The chart shows the average multiple of a person’s non taxed pay that’s required to purchase a property, in that particular region. For instance earning £25,000 per annum where a property costs £150,000 would give an earnings ratio of 6. The UK average is 6.2 as shown on the far right.

 

London has the highest multiple at 10.6 and the lowest region is the North of England at 4.2 closely followed by Scotland at 4.4.

 

By comparison over 20 years, from Q4 2000, this ratio has increased dramatically. This means house prices have risen faster than wages have increased, making property across the UK on average more expensive, relative to what people earn.

Have High UK House Prices Put Buyers Off?

The number of sold properties is down on previous years as shown in the chart but this could be a direct cause of the pandemic. However with interest rates being so low, [the Bank of England base rate is just 0.10%], this means that the cost of servicing a mortgage has actually been downtrending over recent years and is now about bang on the historical average.

uk property sales volume
average house prices for first time buyers

Are First Time Buyers Priced Out?

Of course for first time buyers there is the issue of saving for a deposit. This however isn’t always saved from earnings. Bank of Mum and Dad plays a huge part as 40% of people in 2018-19 received help with a deposit. 

This should actually come as no surprise, being that a 20% deposit is 104% of a first time buyers annual income. 

First time buyers have a below average ‘earnings to property prices ratio’ of 5.2 and  purchase less expensive properties than former owner occupiers. [data for England only]

In short, property has become more expensive relative to earnings over the last 20 years making it harder for people, who need to save for a deposit, to get on the property ladder. Once on the ladder though, the costs of a mortgage are at the historical average mark, meaning property ownership isn’t any more expensive than in previous years. 

This could be taken as a clear indicator that the property market is not overheated. Research conducted by hottubbreakaway.co.uk has shown a 230% in UK demand for holidays since the pandemic. Pushing landlords to reconsider the buy to let model for the buy to let for holidays model. Will this local demand push prices up even further in tourist hotspots.

Home ownership rates are at a 3 year high but still down on 2003 highs of 70.3% meaning there could be room for movement.

Prices increased 7.3% last year but are still down on 2007 highs meaning further growth could be possible plus property prices still remain well below the long term trend.

Interest rates are at a historic low meaning the cost of servicing a mortgage is ‘cheap’ and mortgage approvals are up, which is a good indicator of forward-looking demand. 

Our latest articles include where to buy gold bullion or coins to hedge a house prices crash or inflation. What the best crypto wallets are much more. 

Give us your thoughts? Can you see further house price growth this year or is a looming house price crash on the horizon?