A little look at why we think 2022 could be a good year to purchase a home.
The previous 22 months or so have without a doubt been a sellers’ market. UK house prices have grown at the fastest pace in 15years, with the average home valued at a huge £20,000 more than the previous year. But there have also been considerable opportunities for buyers, thanks to SDLT breaks, favourable borrowing conditions and mortgage lenders bringing out competitive products to win business.
Here are 4 reasons to be hopeful about buying a property in 2022.
1 – Interest Rates Are Still Very Low
Despite the recent rise in interest rates, to combat soaring inflation, interest rates are still very low. Any future rises are expected to be small and incremental.This is good news for borrowers, who tend to gain if interest rates are low. This could be a good time for people to lock in low interest rates on fixed-rate deals, before further rises occur.
2 – The Supply And Demand Imbalance Should Narrow
There is a chance that this should start to narrow as the market starts to cool down slightly, returning to normality after a few years of being supercharged. It seems highly unlikely that demand will be as high as it has recently been, which should in turn make it easier for buyers in terms of competing for properties, while more sellers might be encouraged onto the market thanks to the current growth in house prices.
3 – Most First Time Buyers Still Have A Stamp Duty Holiday
Amid the hype of the stamp duty holiday, it was easily forgotten that most First Time Byers will pay no stamp duty on their first home. This has always been the case ever since Chancellor Phillip Hammond moved to exempt First Time Buyers acquiring homes worth up to £300,000 from paying and SDLT way back in 2017. This will not be changing any time soon so id one less thing for First Time Buyers to worry about.
4 – More New Homes On The Market
There are many issues in the construction sector due to Covid, Brexit, supply shortages and labour difficulties, but you don’t need to travel far before you come across a new build project. So despite some ongoing issues and challenges there is plenty new sites popping up.
The government has a long-held target of reaching 300,000 new homes a year by the middle of this decade. This should encourage the government to accelerate current and future house – building programmes. This was also mentioned in their recent Budget, with plans for a major regeneration and investment in brownfield land and sites.