By next year (2023), property prices are likely to fall significantly in London due to rising mortgage rates. According to Savills’ predictions, prices of properties outside central London will decrease by 12.5% next year with a further 1% reduction by 2024. It is predicted that even after 5 years, property prices will not fully recover and will remain 1.7% lower than current levels.
Property owners in London and the South-East are likely to be affected the most as they tend to have the highest levels of debt. However, prices across the UK are only expected to drop by 10%.
Leading economists such as Paul Dales, have predicted that London prices will fall 15% over the next 18 months, primarily due to high borrowing costs.
People are struggling to buy a house in London because of the recent increase in mortgage rates due to the recent ‘mini-budget’ policies of the previous Chancellor Kwarteng (although, the current Prime Minister Sunak and Hunt have already reversed the effect of the mini-budget).
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