House price rises ‘ are set to stall next year’
HOUSE price growth will be brought to a standstill next year, as the share of first- time buyers in the market dwindles, according to forecasts.
The property market has made a fast recovery since lockdown, Hamptons International says and predicts a two per cent rise this year. But the economic fallout from Covid- 19 will be mostly felt in 2021, it fears.
Even assuming a trade deal agreed with the EU and a vaccine becoming available in the first half of next year, with no full second lockdown, Hamptons expects house prices across Britain to remain flat in 2021.
As the economy recovers, analysts forecast house price growth to accelerate to 2.5 per cent in 2022 and 3.5 per cent the year after.
Prices in the North- East of England will rise by four per cent in 2022, followed by Scotland at 3.5 per cent. Southern regions, where affordability remains tight, will see the weakest price growth in 2022, it said.
Aneisha Beveridge of Hamptons said: “While some economic recovery should have taken place to cushion the withdrawal of Government support, we still expect the housing market to slow next year.” Meanwhile, a separate report from Zoopla predicts that existing homeowners with a mortgage will overtake first- time buyers as the biggest demographic in terms of their share of sales.
Zoopla says first- time buyers will make up 33.9 per cent of the market this year while existing homeowners will be 35 per cent.