The demand for U.K. residential properties has nearly halved year-on-year from the four weeks leading to 20th of November according to property site Zoopla.
The governments mini-budget on 23rd of September is thought to be the culprit as it led to financial markets selling off bonds and rumours of a housing market crash began to be whispered.
The 44% drop compared to the same period in 2021 is partially down to fewer mortgage deals available as many lenders pulled deals off the table as they suspect the volatility in the economy is set to continue. Many buyers are also holding off showing interest or placing offers on properties until job security is solidified and wages settle.
For those that bought a house since the start of September, they have paid on average 5% lower, in some cases more, than the sellers asking price. Sellers desperate to get out of the buyer-seller circuit are having to reduce their asking prices just to remain attractive in the current crisis.
The uncertainty in the buyers market is resulting in many people having to stay in their rentals and fork out additional costs as rent prices soar as competition for rentals spikes. Property site Rightmove released a study that showed that London rental prices had risen 16.1% year-on-year, the highest growth on record.
Future predictions for the housing market are varied. The Offie for Budget Responsibility expects prices to drop by 1.2% near year and 5.7% in 2023. However, Panetheon Macroecnomics suggest 8% and Nationwide, one of the country's largest mortgage providers, predicts prices could drop by as much as 30%.
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