Falling home prices in the spring could signal the end of the market frenzy

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“The rate of growth that we have known since the summer of 2020 could not continue indefinitely and a return to more stable bases would be good news, especially for first-time buyers.”



Based on deals struck between buyers and sellers ahead of Christmas and over the New Year period, house prices are expected to rise 0.2% in February before falling 0.9% in March and 0.8% in April.

Homebuyer activity at the start of the year was strong, according to Rightmove and Zoopla, with record numbers of valuation inquiries and property searches suggesting the pandemic-driven “race to space” continues to unfold, but it remains to be seen how much of this early moving activity translates into sales.
Reallymoving thinks rising interest rates and worries about inflation and the rising cost of living may already be impacting consumer confidence.

Reallymoving captures the purchase price that buyers have agreed to pay when they search for property transfer quotes through the comparison site, typically 12 weeks before completion, allowing it to provide a forecast of the price of the move. real estate over three months.

Reallymoving CEO Rob Houghton commented: “Decreases in the average home price in March and April could signal the start of a slowdown in the real estate market, but the rate of growth we have seen since the summer of 2020 may not continue indefinitely and a return to a base more stable would be good news for first-time buyers in particular.

“As income growth fails to keep pace with the cost of living, concerns about the inevitable squeeze on household finances will make some people think twice about moving and be reluctant to take on more debt, that’s why the shortage of homes for sale across the board could be an ongoing issue in 2022 – especially as many who would have sold this year have stepped forward to benefit from the fee saving. stamp. Much will depend on the volume of new listings we see hitting the market this spring and how quickly lenders increase the cost of fixed rate transactions.

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