House price dip forecast as report shows East Anglian market slowing down
- Credit: PA
Experts are predicting a dip in house prices, as a key housing market report shows sales in East Anglia are slowing faster than anywhere else in the country.
Some 13% of property professionals in East Anglia expect prices to fall in the next three months – the highest percentage in the country – a newly released Royal Institution of Chartered Surveyors (RICS) report said.
The same report found that the East Anglian housing market had been the worst in the country over the past month.
Nearly 70% of respondents saw new buyer demand fall in June, while 36% saw a fall in sales. For both measures, this was the worst in the UK.
One surveyor from Colchester who responded to report commented: “Definite cooling off of the market, air of caution from buyers.
“Still demand for competitively priced properties and starting to see some reductions in values of those on the market in order to generate interest.”
The report comes as Capital Economics, a research consultancy, forecast that house prices in the UK would fall by between 5-10% in the next 18 months.
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But other recent forecasts from Savills are more optimistic.
For the East of England, the projection shows that prices will rise by 6% in 2022, before falling one-and-a-half per cent in 2023.
Frances McDonald, a research analyst at Savills, said: “When looking at the East of England as a whole, the number of sales in the first 26 weeks of 2022 (roughly to end of June) were still 16 per cent above the same period in 2019, but 14 per cent below the same period in 2021.
"You have to remember that the start of 2021 was exceptional as people were rushing to beat the stamp duty deadline.
"But the top end of the market remains much stronger with £1m+ sales across the East of England still 6 per cent above 2021 levels in the first 26 weeks of 2022 and a huge 104 per cent (more than double) where they were in 2019.”
Tim Dansie, director of Jackson Stops in Ipswich, which specialises in high-end property, said: "I'm sure there will be price alterations because the market can't go on forever, but the interest rates are so incredibly low that they keep the market fairly level.
"It's never going to be as dramatic as back in the early 90s when interest rates went from just under 10% to close to 17% in just a matter of months."
Oliver Johnson, a partner at Framlingham-based Clarke & Simpson, said: "I think it'd be pretty foolish to say that this market is going to forge on given the income indicators.
"I don't see any radical price correction coming, I just think it will be a slower burn compared to the manic market conditions we had during 2021 and the first part of 2022."
Mr Johnson said he had seen a property sell for over the guide price just a week after going on to the market. But other customers had decided not to buy due to rising interest rates and fuel prices.
"Maybe those on tighter budgets are thinking, 'actually maybe we'll stay put and see where we are in the spring'," he said.