Rents and capital appreciation will both rise next year - but to a significantly lesser degree than in 2021.
That’s the verdict from Hamptons which is the first of the major agencies to give a 2022 market forecast.
“We forecast that rents will rise by an average of 2.5 per cent in 2022 across Great Britain, following an increase of 3.0 per cent this year. Growth will be dictated by what happens to peoples’ incomes in 2023 and 2024” explains Hamptons.
The agency predicts growth is likely to be slower in the capital, particularly in Inner London where rents may not return to pre-pandemic levels until the middle of 2022.
“We are forecasting overall rental growth in London of 0.5 per cent this year, with pickup to 1.0 per cent in 2022 and 1.5 per cent in 2023. Rental growth is then expected to accelerate to 3.5 per cent in 2024.”
It adds that the regions outside London, where affordability is less stretched, will see stronger growth. Rents seem set to move in similar directions, with no significant North-South divide.
“The South is likely to see marginally stronger growth, with rents here forecast to rise 14.5 per cent by the end of 2024.”
Meanwhile Hamptons anticipates house price rises of 3.5 per cent across Britain next year. Growth will be strongest in the Northern Regions, alongside Wales and Scotland, where affordability constraints are lower.
Specifically, next year Hamptons expects the North East to record the strongest price growth l of six per cent followed by Scotland, Wales, Yorkshire & the Humber and the North West at five per cent.
London will continue to see the weakest growth at just one per cent.
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