Will 2023 be a buying opportunity?

There are lots of negatives for house prices going forward: rising mortgage rates, rising school fees, rising cost of living, an economic recession. The press have been full of it since interest rates started going up. But the oldest and most important dictator of price is supply and demand and this is going to continue to trump everything else as we move into 2023.

I think we all know that Covid kick-started an exodus to the southern counties from London in late 2020 and the throttle has been fully open ever since. However as we approach the end of 2022 with rising interest rates and the cost of living crisis foremost in everyone’s mind, are we going to see a sharp downturn in prices (or a crash as has been widely spoken about)?

The quick answer is no, it will be more a case of the brakes being applied and maybe a slight dip.

There has been so little supply over the last two years that the latent demand has still not been satiated and there are still plenty of buyers looking for their family homes. However we are seeing the beginnings of a small correction, the days of buyers scrabbling to secure a house at 25% over the asking price are over, and going forward bids will be more considered. The best-in-class houses will still attract a lot of interest if they are priced sensibly, but other vendors may have to curb their expectations and either drop their asking price or accept a lower offer.

Mortgage lenders are being tricky and mortgage valuers are often downvaluing properties, so buyers need to build in a bit of wiggle room to counteract this. Cash is still king and so buyers who do not need financing will always be preferred. The number of fall-throughs has increased from an already very high 30%.

All of this indicates that going forward there should be some good opportunities for buyers who can react quickly and are ready financially.

In the last 3yrs, over 75% of the properties we have bought for our clients have not been advertised on the internet. The benefits of instructing a buying agent based in the area you are looking who has expert knowledge, good local contacts, an excellent track record and a close relationship with all the local agents, is paying huge dividends in the current climate. We continue to get fantastic testimonials from our clients who have experienced the high level of professionalism and bespoke service that Stacks provides. In 2023, local knowledge and contacts are going to be more important than ever.