What are the top 5 property market predictions for 2022 that investors should keep an eye on?
say 2021 has been the UK property market's busiest year since the financial
crisis of 2007/8. With the property market in the UK changing constantly
it can be difficult to predict what will happen next. As ever, predicting
property trends isn't an exact science, but worry not! This blog has 5
predictions for the property market in 2022 that investors should keep an eye
on. Learn how these predictions could affect your investments.
1 : The property market will be busy, but
to Rightmove, the UK’s housing market is likely to return to more normal
levels of activity in 2022 but will still be busy, with strong buyer demand
carrying forward into this year and a stable number of homeowners getting ready
website said that following a “frenzied” 18 months, the market was heading for
a “less frenetic” period, with a more even balance between buyers and sellers
as more homes are put up for sale and higher interest rates take some of the
heat out of buyer demand.
world currently struggling to fight off yet another Covid variant, the economic
impact may be hard to predict, and the market could become more volatile over
the next few years. This means that prices could rise and fall quicker than they
have in the past. Investors should keep an eye on the market trends and
consider their investment exits. Volatility can present both
opportunities and risks, so it will be important to stay up to date with the
latest property strategies and news in order to make well-informed decisions
2 : Average property prices will remain
all predictions last year, 2021 broke all records on the average house prices.
During October, average house prices across the UK stood at £268,349, according
to the latest available data released by UK Finance.
this was a slight dip of 1.1% against September, this was to be expected as the
temporary stamp duty holiday came to an end.
biggest problem the housing market faces is still a huge imbalance between
supply and demand, putting upward pressure on house prices. Furthermore,
costs of materials and labour have risen, rules and regulations are restrictive
and there is a backlog of planning applications. All these have a major
impact on the housing market and average house prices. With not enough
housing available, prices are likely to remain strong for the foreseeable future
and increase further, especially in popular locations.
are looking to invest in property in the next few years, do your research and
spread your risk across projects. If you are investing in crowdfunding
projects, learn about the developer and project.
3 : A strong rental market with rental
to the English Housing Survey, nearly one in five households in England live in
the private rented sector – that equates to over 4.4 million households
nationwide. 17 per cent live in the social rented sector and 65 per cent are
property prices continuing to rise, home ownership is becoming
increasingly difficult for many. Some experts predict that the UK will become a
nation of predominantly renters by 2045, with 55% of the population living in
the rental sector.
with property prices, rent prices are also predicted to rise over the next few
years. This means that landlords can expect to see higher profits from their
investments. But it also means that tenants will likely face higher rents
when looking for a property to rent.
in recent years the regulations have tightened, with an increase in the
obligations that every landlord must abide by. These include anything
from fitting smoke alarms and carbon monoxide detectors to issuing annual
gas safety certificates and ensuring that electrical devices are safe to use,
all of which impact rental yields.
government is now proposing to bring the required Energy Performance
Certificate rating from E to C forward to 2025. Many properties are not
up to or cannot meet this standard, especially Victorian and older properties.
If the government is not forthcoming in financially supporting landlords to
make these changes, rental prices will increase further. No doubt many
will leave the market, which means rental properties will be harder to come by
and become even more expensive.
are planning on becoming a landlord in the next few years, then it is important
to factor in these changes when setting your rental prices. For those of
you investing into crowdfunding opportunities, this presents an opportunity if
you are looking for cashflow.
4 : Interest rates will go up
Covid-induced lull, summer 2021 saw a surge of
competitive buy-to-let mortgage deals, with many lenders increasing
maximum loan to value (LTV) amounts from 75 per cent to 80 per cent. This means
that potential investors do not have to raise quite such a hefty deposit to
secure a mortgage. In the buy-to-let arena, lenders started to reduce
interest rates and offer fee-free options. Despite talk of inflation and a
potential increase in the Bank of England base rate, interest rates on all
mortgages remain historically low.
though interest rates have remained very low, the Bank of England won’t wait to
tackle rising inflation, despite the ongoing Covid situation. How the new
strain, but also Brexit (longer-term), will impact the economy and inflation is
a big unknown. But the general census is that inflation and interest rates
will go up.
are looking to increase your property portfolio, it would be wise to consider
your finance options now. In parallel, there is still time to revisit
your mortgages and secure a fixed rate deal as quickly as possible.
5 : Investment into property through
crowdfunding will continue to grow (faster)
investors not wanting to purchase an investment property themselves, there is
an alternative. Property Crowdfunding is growing quickly and allows you
to invest in property at your own level and pace. There are many benefits
to accessing the property market this way.
crowdfunding, you can access multiple projects to invest in. As an
approved investor, you can diversify your investments across multiple
projects, spreading the investment risk. Depending on your appetite for
risk, you can choose to invest in debt projects (fixed returns over a fixed
period of time) or equity projects (projected higher returns, with higher
risk). You can also invest into certain projects using your pension
and/or ISA allowance, allowing for tax free returns.
crowdfunding, investors become part of a like-minded community where they can
learn from other investors and the developer.
above has left you with a taste to get on the property ladder, access property
investments or learn more about property crowdfunding, come and join the
growing crowdfunding community ==> www.simplecrowdfunding.co.uk
investments carry risk and returns are not guaranteed. Remember to always
do your own due diligence, read the information provided and ask questions.
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