Is A House Price Drop On The Way?
There is a lot of talk about an impending housing price correction…
Prices have been growing rapidly in recent years, but we are now seeing a slowing — and even a decline — in certain locations.
Halifax reports that prices declined 0.1% in July, cutting the annual rate of rising from 12.5% to 11.8%.
Rightmove reported a decline of more than 0.1% for the same time period.
But, in view of such big recent gains, is this tiny drop truly symptomatic of a broader correction ahead?
Summer price declines are not unusual and August is a month when many potential purchasers have other things to do. It’s tough to know for sure if a correction is beginning; it’s just guesswork as there’s no way to foresee the future.
Despite the current cost of living woes, the property market fundamentals remain robust. Excess savings accumulated during the pandemic, strong demand, low-interest rates, and changes in working practices all continue to support the market.
Not to mention the historically low levels of available property for sale.
> And, while buyer inquiries are down 4% from 2021, they are still up 20% from 2019.
BUT
> In 2019, estate brokers had 39% less inventory than in 2019.
As a result, the supply-demand imbalance persists. Whatever happens, successful long-term property investors will always find opportunities that provide them with strong, consistent returns.
