You are here: Home - Mortgages - First Time Buyer - News -

New Year house prices forecast to drop after Christmas peak

Written by: Samantha Partington
House prices are forecast to begin falling gradually in the New Year after reaching their peak this month, according to the Reallymoving House Price forecast.

Reallymoving, which provides quotes for homemoving services, predicts that house prices will fall by 1.2% in January and 2.5% in February.

Before the decline in prices begins, the average price paid for a home will reach a new of high of £352,239 before falling to £343,312 by February 2021.

Reallymoving has based its prediction on analysis of 30,000 conveyancing quotes which provide an early snapshot of the short-term housing market.

For example, the forecasted data for December 2020 to February 2021 is based on registrations for conveyancing quotes from September to November 2020 respectively which typically take around three months to complete.

The firm’s analysis also found that the proportion of first-time buyers in the market fell by 12% in the last six months compared to the same period last year.

Rob Houghton, chief executive of Reallymoving, said: “Our prediction of a New Year change in fortunes for the housing market has been further strengthened by the latest data which clearly shows price growth entering a downward trend in January and accelerating in February.

“The mask is beginning to slip on the two-tier housing market of recent months, which has seen activity from equity-rich homeowners who are less affected by the pandemic, concealing problems at the lower end of the market where first-time buyers have benefited little from the stamp duty holiday and faced considerable challenges securing higher loan to value mortgages.”

“The kind of growth we’ve seen over the last few months was never sustainable. Despite positive vaccine news, which will certainly boost confidence that the end of the pandemic is now in sight, there are significant challenges for the housing market to overcome in the short term, including the end of both the stamp duty holiday and the furlough scheme on 31 March, which is likely to result in further downward movement in prices over the first half of next year.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Everything you wanted to know about ISAs…but were afraid to ask

The new tax year is less than a fortnight away and for ISA savers or investors, it’s hugely important. If yo...

Your right to a refund if travel is affected by train strikes

There have been a wave of train strikes in the past six months, and for anyone travelling today Friday 3 Febru...

Could you save money with a social broadband tariff?

Two-thirds of low-income households are unaware they could be saving on broadband, according to Uswitch.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week