London lettings and estate agent, Benham and Reeves, claim that before the end of 2022, house prices will increase by an additional 5%. This is estimated to add a further £14,320 to the average property value bringing it up to £300,717.
The new research suggests that the current cost of living crisis and soaring interest rates are to blame and will continue to impact the market.
Property price increases across England
Benham and Reeves predict that the biggest price increase will be seen in London. With a significant boost of £26,896, property prices across the capital are expected to rise to £564,816 on average.
Kensington & Chelsea was labelled as the London borough with the highest price increase of £68,103. This is then followed by Westminster (£47,222), the City of London (£41,519), and Camden (£41,493).
Outside of the capital, the South East is predicted to experience price increases of £19,526. This will boost the average price to £410,039. The increase in the East of England will be £17,724, followed by the South West (£16,116), West Midlands (£12,306), and East Midlands (£12,296).
On the opposite side of the spectrum, some of the smallest end-of-year price increases are expected to be seen in the North East (£7,896), Northern Ireland (£8,453), and Scotland (£9,612).
Director of Benham and Reeves, Marc von Grundherr, concludes: “We keep waiting for house prices to plateau, but it’s just not happening. The pandemic-inspired boom in demand and value has supercharged the housing market to such an extent that it seems even a cost of living crisis and soaring interest rates can’t stop it in its tracks.”
“So much so that house prices are likely to keep on climbing as the year plays out and in some areas, this will equate to quite a significant increase in property values.”
“As for if and when prices will finally fall – it’s hard to predict. But if this coming winter is going to be as tough as most are suggesting it will be, we might find that moving home is pushed to the very bottom of most people’s to-do lists and property values might, therefore, start to decline.”