CrowdProperty has noted the resilience of the housing market despite the cost-of-living crisis, after average prices increased by 1.8 per cent last month.
According to the Halifax House Price Index, a typical UK property now costs £294,845, which equates to an annual growth rate of 13 per cent – the highest since late 2004.
“The supply-demand imbalance continues to be the reason why house prices are increasing, with demand remaining strong while the stock of available properties remains extremely low,” CrowdProperty said.
As a result, Rightmove has revised its 2022 price forecast up from five per cent to seven per cent annual growth expected by the end of the year.
However, CrowdProperty cited Russell Galley, managing director at Halifax, who predicted that this could change in the coming months.
“Increased pressure on household budgets from inflation and higher interest rates should weigh more heavily on the housing market, given the impact this has on affordability… So while it may come later than previously anticipated, a slowing of house price growth should still be expected in the months ahead,” he said.
And analysis from the peer-to-peer property development lender noted that in inflation-adjusted real terms, the current market is probably closer on average to 9.8 per cent below 2007’s peak prices and equal to 2004 levels.
Looking at different regions in the UK, CrowdProperty found that the greatest house-price inflation is being seen outside of London.
Northern Ireland has seen the highest rise, with an increase of 15.2 per cent, making an average property worth £187,833.
This compares to London, where an average property costs £547,031. It is still the most expensive place to purchase a home in the UK, but house price inflation lags behind the rest of the country at 7.1 per cent.
CrowdProperty also highlighted the current push towards more eco-friendly housing, which is supported by government initiatives. It said this trend has a “clear” impact on property developers, with double or triple glazing, low energy lighting and dual flushes to reduce water usage being installed in many properties as standard along with loft and cavity wall insulation providing further energy efficiency.
“According to research from Zoopla, the growing ‘green home movement’ also sees 74 per cent of new home buyers claim that it is important that their home is built with minimal impact on the environment,” CrowdProperty said.
“Developers are increasingly employing modern methods of construction, which see the offsite build of ready-made walls, floors and even entire rooms that are then transported to site, as a way of controlling waste production and limiting noise and dust pollution on site (the complex funding of which CrowdProperty pioneered with the market’s first dedicated modern methods of construction finance product).”