Is the UK property market heading for a Crash in 2022? In a recent survey conducted by the House Buyer Bureau, they found that more than half of the estate agents polled were worried by the current market, with more than a quarter believing a crash was imminent.
Despite recent headwinds, UK property prices are continuing to rise and have just reached a record average price of £371,158. Many feel this is entirely unsustainable, causing them to ask, “When will the UK property market crash?”
According to newly conducted research, more than 1/4 of estate agents polled believe that we are most likely to see a significant market crash over the coming months, and it is hard to disagree with their views, given all the recent political and financial turmoil.
Why UK property prices are so high is a mystery, some believe that house prices have been deliberately pushed upwards to make people feel wealthier, making them far more likely to spend and borrow to help the country’s ailing economy. That’s all and well and good; however, when the property market experiences what some would prefer to call a ‘correction’ rather than a crash, it will leave many with their heads in their hands, uttering the words, “What have we done?”
Whatever the reason, the vast majority believe that the rise in house prices is unsustainable and some form of ‘correction’ was necessary. A new survey revealed that a significant number of agents can see a property market crash on the horizon, and more worryingly, it could happen in months.
The House Buyer Bureau surveyed more than six hundred estate agents to understand their professional feelings on the current and future outlook on the UK property market.
What the research shows
The survey results showed that more than half polled (55%) are worried about the current outlook for the UK property market, with just over one in ten (11%) offering a positive outlook for the coming months.
Even more revealing is that more than a quarter (26%) felt that a significant market crash would likely happen over the coming months, with a further 37% predicting there will at least be a downward turn in house prices and 27% seeing a flatline in house prices.
32% stated they had seen a slight decline in business from home sellers, with 10% seeing a more significant reduction in seller activity. However, almost a quarter (24%) did state that business had been on the up.
27% also revealed that buyer demand for the homes they were selling had remained robust, although 42% have seen buyer demand levels start to decline, with a further 43% stating that buyers are also offering less compared to the pandemic house price highs of the last two years.
As a result, 41% revealed that they are now advising sellers to adjust their asking price expectations in line with the lower level of homebuyer purchasing power being seen.
With tough times ahead, it’s hardly surprising that just 12% stated they would be lowering their fee over the coming months, even in an attempt to win more business.
When it comes to just how long agents believe these tough times will remain, 33% believe the market is in for a long-term period of adjustment, lasting beyond next year. 41% believe it will be a mid-term correction lasting throughout next year, with 26% hopeful they will return to business as usual by the new year.
Chris Hodgkinson, the Managing Director of House Buyer Bureau, said, “The market is holding firm for the time being, but the wider expectation amongst those on the ground is that a correction is on the way in one form or another.
We’re already starting to see early signs of this correction, with a good proportion of agents already noticing a decline in both buyer and seller activity and a reduction in the pandemic high house prices that buyers are willing to pay.
With many also fearing a mid to long-term period of muted market activity, it certainly looks like the sector is in a tougher year in 2023.”
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