It’s changes in the rental market which will have the biggest effect on property prices in the next year or two. An obvious one is the rise in interest rates. Around half of landlords have a mortgage one at least one of their let properties, and those who only own one are most likely to owe money on it. If their payments more than double, they will either have to hike rents (if they can) or sell (again, if they can find a buyer). Less obvious is the need to upgrade their properties’ Energy Performance Certificate. Rental homes must have a rating of C or above by 2025; currently only 30% have, and the other 70% will have to spend, in many cases big bucks to bring them up to the new standards. Most of those I’ve asked have only a vague understanding of this, the average estimated cost is £10,260 and the deadline is looming. Many are likely to bail out.
“Halifax index shows UK house price drop accelerates”
So gentle subsidence, rather than a crumble to rubble seems to be the predicted pattern for house prices. There have been what seem, with the great gift of hindsight, inevitable ‘market corrections’ every few years (1989-92 and 2008-10).
