Property and rent price rises speed up as low stock and inflation grip households
The pace of property and rental price rises in the UK has sped up, according to the latest figures, as a cost of living crisis shrinks household budgets.
Rents in the UK rose by three per cent in the year to June, up from 2.8 per cent in the 12-months to May.
House prices increase 12.8 per cent in the year to May to £283,000, up from 11.9 per cent in April, the Office for National Statistics revealed today.
The average cost of a home has jumped by £32,000, more than the average annual wage of £31,252.
“It is hard to see how there will be a property crash when the shortfall in property stock remains a constant problem. Though rising interest rates are tempering buyers’ enthusiasm, in historic terms borrowing costs still present reasonable value,” managing director of London-based property finance specialist Advias, Edward Checkley, said.
“Looking forward to 2023, should inflation not fall and interest rates continue to rise, property values may see a correction to compensate for additional finance costs,” Checkley continued. “However, this may not be the case if inflation eases and interest rates remain relatively attractive. We may see short-term corrections in regional locations, where buyers fought over idyllic property and areas during the pandemic.”