Home PropertyDelaying your property sale could cost you thousands as house prices predicted to drop

Delaying your property sale could cost you thousands as house prices predicted to drop

by LLP Editor
12th Aug 21 12:20 pm

The latest research from the homebuying platform, Yes Homebuyers, has highlighted a potential drop in UK house prices over the coming year and analysed exactly what the pounds and pence impact will be for homeowners and sellers.

Recent projections from the Office for Budget Responsibility (OBR) have suggested that UK house prices will fall by -1% by Q4 2022.

While this may sound marginal, it could well be a best-case scenario for UK homeowners as the stamp duty holiday and furlough scheme both come to an end with the difference between selling today and selling this time next year bringing a significant hit to the wallet.

Yes Homebuyers has analysed the OBR data to calculate the impact that such a price drop would have on UK house prices and has discovered that delaying a house sale for a year or so could result in a loss of up to ยฃ5,000.

It comes as no surprise that the impact of a -1% price drop would hit hardest in London. If the OBR projection is correct, by Q4 2022, the average London house price will be ยฃ487,438; a loss of ยฃ4,924, or ยฃ615 every quarter.

In the South East, a -1% price drop would bring the average price down to ยฃ333,582, a loss of ยฃ3,370, while in the East of England, prices would drop by ยฃ3,026.

House values will decrease by more than ยฃ2,000 in the South West (ยฃ2,749), West Midlands (ยฃ2,119), and East Midlands (ยฃ2,080), while dropping by more than ยฃ1,500 in the North West (ยฃ1,801), Wales (ยฃ1,795), Yorkshire & Humber (ยฃ1,780), and Scotland (ยฃ1,636).

On a local authority level, itโ€™s the boroughs of London that are going to see the most severe price drops. Nowhere will be hit harder than Kensington & Chelsea where the average house costs more than ยฃ1.3 million. A -1% price drop would, therefore, result in a loss of ยฃ13,210.

In the City of Westminster, prices would fall by ยฃ9,027, Camden would see an ยฃ8,058 fall, and prices in the City of London would decrease by ยฃ8,003. Elsewhere in London, namely Hammersmith & Fulham, Richmond-upon-Thames, Islington, Wandsworth, and Hackney, prices will fall by more than ยฃ5,000.

The only local authority area to feature in the top 10 and not be found in London is Elmbridge, a district of Surrey so close to the capital that it borders the aforementioned borough of Richmond.

Matthew Cooper, Founder & Managing Director of Yes Homebuyers, commented: โ€œThe housing market has enjoyed a real boom since early 2020. But, what goes up must come down, and house prices are no different. They are currently so inflated through high demand and lack of supply, that it would take a miracle for them to remain this high for any extended period of time.

โ€œThis means weโ€™re facing an inevitable drop and those looking to sell their home would be wise to act quickly instead of waiting. With some house purchases taking up to 500 days to complete, it could even be that time has already run out to sell for a high price on the open market.

If you want to sell your home quickly in current market conditions, a quick sale platform such as Yes Homebuyers could be your best bet of doing so. The only other option is to tough it out in the current market where sales are dragging on for an extremely long time and an impending house price drop could be far more considerable.โ€

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