The discussion of property, specifically amongst those looking to buy in London, can be a heated one. However, the crux of most debates is related to whether house prices will drop in 2023. Whilst no property prediction can be certain, there can be a strong forecast made for how house prices will rise and fall over the next year.
What Did The Industry Forecast Say At The Start?
There’s been a prediction over the next two years that house prices will fall significantly. More specifically, at the beginning of the year, property experts Savills predicted that house prices in London could drop by 10% by the end of 2023 (Savills, 2023). Savills also stated that this prediction is supported by previously seen patterns of prices increasing due to high housing demand and then buying decreasing due to this increase, which then drives prices down.
Are Property Prices Following These Predictions?
The end of 2022 was a worrying time for those looking to see an increase in their property value. There was a significant and fast drop in property prices which made the market tumultuous for buyers. This was partially due to the steep rise in interest rates, which made both banks and borrowers panic. The banks tightened their lending criteria, making mortgages more difficult to get. So this resulted in more property being available as fewer people were buying, which drove the prices downwards.
This recovered at the beginning of 2023, and the drop in property prices slowed, especially in London. From January to April, the prime London property market stabilised, with little to no exponential increase on last year.
How Do London Property Prices Compare To The Rest Of The UK?
As previously stated, London prices are different to the rest of the UK. Property tycoons and industry leaders predict a 7% decrease in house prices across Greater London (Savills, 2023). However, they are still predicting London to be the best-performing area in 2023 in the property markets, so, it wasn’t all doom and gloom.
In summary, the experts at Edwards Removals believe that if there is any drop in property prices in London and the rest of the UK, this will likely be a short term adjustment to the market. Therefore, it is important to have a long term mindset in mind.
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