Experts are always trying to predict when property prices are going to rise and fall and have been expecting that prices will drop this year with some people in the property world claiming that the market could see as much as a double digit drop by the end of 2023.
Here we take a look into some of the current property market, what has happened so far this year and the upcoming forecasts to see what we could possibly expect for the coming months when it comes time to sell property online.
House Prices in 2023 So Far
At the beginning of the year, a lot of research suggested that residential house prices could fall by around 11% in 2023, but the economy has fared better than many in the industry expected and has so far avoided the recession which they forecasted.
For the first half of the year, the UK house price index shows that the average prices have fluctuated slightly, starting at £290,000 in January, dropping by 1% in February and a further 1.5% in March. They then increased a little by 0.5% in April only to fall again by 0.4% in May and a slight increase again in June of 0.7% which means there has only been an overall decrease of just under 1% from January to June.
What is Affecting the Housing Market?
There are a number of different factors that have and are currently affecting the housing market and will likely continue to do so in the coming months. These include;
- The cost of living crisis which means people have less disposable income and are therefore less likely to be able to afford to get on the property ladder or move home.
- High interest rates are making mortgages more expensive and less affordable for a lot of buyers because higher rates mean they can’t afford to borrow as much.
- Job security might seem irrelevant but in the current economic climate, companies of all types and sizes can unfortunately experience serious and rapid declines resulting in job losses and redundancies. This means that buyers are less likely to make such a big financial commitment such as buying a home or moving to a new property if they don’t have job security.
In an environment where households have less to spend, are unable to borrow as much and have worries about employment, house prices must react accordingly.
What Might Happen in the Remaining Months of 2023?
Whilst what is going to happen to house prices over the coming months could be anyone’s guess, a lot of leading experts are expecting a few things to happen, including;
- That interest rates should reach their peak and finally begin to fall
- House prices begin to stabilise and more homeowners will be boosting their homes value before selling
- The market as a whole will start to go back to ‘normal’
If these do occur and the market begins to shift and change for the better then it should slowly make it easier for buyers to find a mortgage and buy a new home or get on the property ladder.
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