The estate agent Savills is forecasting a major drop in the average price of a house in the UK during 2023, which will mark a huge shift for the market after more than two years of consistent price growth.
According to its analysis of the market, average house prices will fall by as much as 10% next year, which is also expected to be when interest rates hit their peak. Despite this though, the estate agency is suggesting that the rate of the slowdown within prime housing markets will be less steep and that these will produce higher prices across the five-year period of its forecast.
Savills is also stating that next year will see the gap between those with the cash or equity to be able to buy outright and other buyers in the market grow wider, with this being reflected in the prime and mainstream property markets. The average property price in a prime location such as the centre of London will go down only 2% next year and be 13.5% higher within another four years.
Furthermore, there is expected to be a drop in buying and selling, due to first-time homebuyers struggling to afford to make a move. Lucian Cook from Savills stated that although the market had remained largely unaffected by other economic pressures until now, the situation had changed during the autumn when the Bank of England started to raise rates.
Specialist lenders are likely to be more important to those with CeMAP mortgage advisor training from next year.
