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Prime property prices will 'trend upwards' in 2022

Prime property prices will 'trend upwards' in 2022
Karolina Grabowska via Pexels

Mortgage advisers have been urged to help their clients make a prime location purchase "promptly" if they have the means to do so, as prices will keep trending upwards. 

According to Craig Tonkin, head of sales for central London estate agency Bective, big-ticket property prices will continue to rise throughout 2022, driven partly by demand.

He said: “We expect the upward trend of house price growth seen throughout 2021 to continue well into next year and so this is the really the predominant concern for those considering a big-ticket purchase.

"There is a severe shortage of good quality housing stock available and we’re also seeing mortgage applications continue to increase as buyer demand levels remain robust."

But while applications were held up in the pipeline throughout 2020 and 2021 as the pandemic forced lenders to work remotely, Tonkin said most banks and building societies are now turning things around quickly.

"While a further increase in property values may be a concern in the short term, those with the financial means to make a purchase should be able to do so fairly promptly", he added.

His comments came after Bective compared its activity in the prime market in 2019 with 2020. 

Although the UK endured six weeks of lockdown restrictions in March to June 2020, the rest of 2020 performed relatively well considering the disruption, making up for the lower volume of transactions during the six weeks of lockdown, he said.

Rob Pratt, lettings director for Bective Notting Hill, added: "It's fair to say that actually, the pandemic impact on the prime rental market was fairly muted both in terms of the number of rental applicants and the level of stock reaching the market."

While the pandemic was "always going to interfere with market activity" Pratt noted the last quarter of 2021 had seen the most prestigious parts of the housing market return to "pre-pandemic levels", with plenty of interest from people relocating from abroad. 

The comments echo those made by eSurv in October, when the company issued its latest house price growth index. 

While there had been a slight 'retreat' in some areas, such as the North-East of England, which saw a 6.3 per cent drop in the annual rate of growth over October, other areas fared better. 

According to Richard Sexton, director at eSurv, London properties have still held their own, despite a trend towards people moving out of the Big Smoke.

He said: "In terms of property types, it’s worth noting too that, while the pandemic drove a race for space, the price of flats in September staged a small recovery with the largest gains in flat prices being seen in Prime Central London and in Hammersmith and Fulham."

simoney.kyriakou@ft.com