The number of house sales set to take place before the end of this year is being tipped to reach its highest level for 14 years, with 1.5 million mortgage completions forecast.
The September house price index published by Zoopla also suggests that the overall value of completed new home sales will hit £473 billion before the end of 2021, which would set a new record and represent a rise of £95 billion on the total for 2020. Zoopla is predicting that the boom in house sales will slow down a little next year, but it is also arguing that above-average demand in the market will prevent any serious drop-off.
This demand currently stands at up to 30% higher than the average for the past five years. Unfortunately, it is not matched by the supply, which Zoopla pointed out is likely to keep house prices at a high level. However, the company is also arguing that prices will remain within the reach of the average buyer, even if lenders put rates up from their present low levels.
According to Mortgage Solutions, the Zoopla index states that:
“Our projections assume mortgage rates will reach 3% by the end of 2022 – the highest level since 2015 but still low by historical standards.”
The index suggests that pandemic-related factors like the need for greater housing space will continue to drive the market.
Advisors with CeMAP training will likely welcome a healthy market with affordable prices for buyers, so it is to be hoped the index is accurate.