It was a great year 2021! We came out of one variant and headed into another. Talk of further lockdowns followed. The first time in three years that the interest rate rose was officially announced a few weeks back . To curb inflation, more rate hikes are expected this year. The stamp tax holiday was a success because it kept property transactions buoyant but also contributed to the current inflation. After a few years of hard times, the London rental marketplace appears to be making some progress. This happened despite the fact that there is a healthy rental market elsewhere.
What are the 2022 predictions?
Inflation is likely to remain an issue as many countries struggle to deal with the supply shortages that were largely caused by the pandemic. Inflation was measured by the Consumer Prices Index (CPI), and it rose 5.1% between November 2021 and November 2021. This is one of the biggest increases in the past 20 years. It means that interest rates will continue to rise to reduce inflation. According to the Office of Budget Responsibility (OBR), rates could rise as high as 3.5% in 2023, which is worrying considering that the current rate of 0.25% is it. This is likely to signal the end of an era of record low interest rates.
Rightmove anticipates that the housing market will be more balanced between buyers and sellers in 2021 than in 2021. The lack of housing stock was a major reason for price inflation. Rightmove predicts house prices to rise by 5% nationally this year, but it is difficult to argue with the fact that the fundamental numbers remain strong. The number of homeowners requesting to have their homes valued by estate agents rose 19% compared to the same time last year. The November data also shows that buyer numbers are up 41% over 2019 and 3% over 2020.
We will not know how the market will develop until the government clarifies how long it will allow people to work remotely (for those who are able), or if there are any additional restrictions in January/February. At the time this article was written talks of an end to restrictions.
Manchester is still a strong region for growth in 2022. Birmingham is expected to be a major winner, mainly due to its hosting of the Commonwealth Games 2022 and the HS2 Project.
Rob Dix and Rob Bence from The Property Podcast suggest that Nottingham, Liverpool Derby, and Manchester are the best areas to invest in the UK in 2022.
They then make bold predictions about property prices rising between 6-8%, which is higher than any other official predictions such as the Rightmove prediction. They expect London’s market to grow by only 4%. For more information, visit their podcast.
Making predictions is fun. No one can predict the future with any certainty. However, getting the opinions of many experts in the industry about what’s likely for 2022 will keep your informed and help you to take action if necessary.
