The latest Savills’ forecasts have shown quite a dramatic change in expected price changes for 2022 and 2023.
As the table below shows, in their revised forecasts for 2022, Savills have pretty much doubled expected price growth for this year, with prices expected to continue at double digit growth for Yorkshire and Humber, Wales and the North East, with the Midlands and Scotland close behind, rising at 8.5%.
Expectations for London appear to be better than they have been – around 3.5% growth, while price growth everywhere else is expected to exceed the long-term annual average of around 3% for the third year in row.
Cost of living crisis
However, with the cost of living crisis hitting the country and latest data suggesting that we are heading into a recession at some point over the next 12 months, it’s not a surprise that the growth this year is just taking away from originally expected growth for 2023.
And in fact, that’s the most interesting change with the forecasts in that Savills expect the increased growth they have forecast for this year to be dissipated in 2023, with a slight fall in property prices.
Few people, especially buyers and sellers, should be concerned about property price changes on an annual basis.
However, very few people, especially buyers and sellers should be concerned about property price changes on an annual basis. What’s more interesting – and to some extent reassuring – is that Savills’ five-year forecasts hasn’t really changed that much.
So, despite all the doom and gloom we are reading about ‘bubbles bursting’ and dreadful times ahead, it’s clear that, just like during the pandemic, the long-term expectations for the housing market are still looking pretty good!