The second half of 2020 saw an acceleration of house price growth that has followed through to the beginning of this year. The average UK house price has since increased by 9.8% over the year to March 2022, down from 11.3% in February. Some wonder if this trend is the beginning of the end for the constant rise that has supported the property market since the beginning of the pandemic in2019.
Mish Liyanage, CEO of property group Mistoria- boasting a diverse portfolio of over1,000 properties in the North West- explained that the pandemic led to a bullish marketplace. She commented that the lack of spending opportunities during lockdowns helped households create a large cash reserve, leading to extra funds to spend on property.
The positive for future property growth is that demand seems stable. Looking at Greater Manchester, developers can see a vast amount of people driven towards the city in hopes for work following the number of jobs being created.
However, with the increased prices, both professionals and students are seeing themselves priced out of property in city centres. This has caused a demand for shared housing equivalents. This is further explained by the higher rents in the private housing market as demand has increased. Because of this, investors may find an heightened amount of refurbished property, converted from flats and houses to fully fledged HMOs- short for ‘house in multiple occupation.
Property advisors are suggesting investors searching for property to expand their horizon to commuter towns with direct transportation connections to the city. Combing the low-cost entry prices in these towns with the rising interest in HMOs means investors will be getting a foothold in these up-and-coming developments and gaining higher yields and capital gains in the long run.
It is understood that house prices are settling, with an increase of 0.3% between February and March 2022 compared to last year’s 1.6% during the same period. However, this is still a 0.9% rise following the previous months in 2022.
This should convey to investors an opportunity to invest with the steadily stabilising marke tas the overall price of property is set to level off instead of dropping to previous years rates. There should be no reason to worry as property is still the investment people turn to for stability and passive income, and that does not seem to be stopping anytime soon.