‘Difficult news to stomach’ – house prices won’t drop until summer 2022, predicts expert
Martin Roberts discusses the rise in house prices
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New research from national estate agent Keller Williams UK suggests that house prices could remain elevated until summer 2022. House prices have surged over the last 18 months thanks to the stamp duty holiday and changing buyer sentiment. Demand outstripping supply and increased demand has meant that homes are now selling incredibly quickly for thousands of pounds.
After the tapering of the stamp duty holiday, many experts predicted that house prices would drop.
However, despite the threshold reduction, house prices have remained surprisingly elevated.
The stamp duty threshold has been reduced from £500,000 to £250,000 until September 30.
The threshold will then return to the standard amount of £125,000 on October 1.
Keller Williams looked at how the seasons impact house prices and market demand over the past 36 months.
Their analysis revealed that house prices are unlikely to drop until at least June 2022.
The estate agent research shows that the UK housing market follows a predictable cycle.
Over the last three years, in September, October and November (autumn) house prices have sat at £240,000.
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This time of year tends to be busy which explains why house prices are still high today.
As the UK property market hits the winter months (December, January and February), the average house price increases even more.
Over the past three years, house prices have averaged £243,998 in winter.
As the weather heats up and gardens begin to bloom in spring, house prices rise again to an average of £245,000.
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Usually, the summer months indicate a decline in house prices.
Over the past three years, the average house price has been £237,980 – the lowest price for the whole year.
With the UK already experiencing surging house price growth this summer, the data suggests prices will continue to increase until summer 2022 at least.
CEO of Keller Williams UK, Ben Taylor, said house prices could continue to rise for the rest of the year which is “difficult news to stomach” for buyers.
He said: “The stamp duty holiday has spurred an incredible run of upward house price growth and despite many predicting a market slump, we’re yet to see any let up.
“Season trends suggest this could be the case for the rest of this year and much of next as the market tends to perform at its best during the autumn, winter and spring seasons.
“For buyers, this is difficult news to stomach, especially those who are hoping to move sooner rather than later.
“But it will no doubt be welcomed by sellers who should continue to secure a very good price when entering the market.”
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