Property market 2023: Drop in sales far more likely than drop in prices – Property Reporter

Chestertons’ forecast predicts that prices across England and Wales will drop by around -1% in 2023, compared to a drop of -3.2% in London. The capital will then lead the recovery in 2024, with prices rebounding by 9%, compared to a smaller increase nationally.

The agency doesn’t believe that prices will fall substantially as it thinks the strong underlying demand for homes combined with fewer-than-expected forced sales will cushion prices. Instead, it expects that many homeowners will adopt a ‘wait-and-see’ approach for the first half of 2023, which will reduce the number of property sales that take place. It is anticipated that this lack of activity will cause a high degree of ‘buyer frustration’ in the second half of the year which, when released, will support the rapid price growth they expect in 2024.

Sebastian Verity, Head of Research, explains: “We expect 2023 to be characterised by a slower property market during which around 25% fewer properties will come onto the market and change hands compared to a ‘normal’ year. The government is actively working with mortgage lenders to avoid additional stress on borrowers so we believe the number of forced sales will be relatively small and the lack of supply, combined with the strong underlying demand for homes, will ultimately insulate the market from any dramatic falls in prices.”

Matthew Thompson, Head of Sales, adds: “We are already seeing signs of supply tightening across the London property market, with a -30% drop in the number of people requesting valuations of their properties in the last three months of 2022. As supply and activity continue to fall going into 2023, we believe this should counteract the majority of the downward pressure on house prices.”

Chestertons expects that London’s prime property market will outperform the mainstream market

The original article can be found here