Economists expect growth in UK home prices
British home prices will continue to accelerate over the next few years. The growth will be attributed to low borrowing costs, supply shortages, and people’s demand for larger space, a Reuters poll of analysts showed.
Economists expected house prices to climb 6.0% this year, 3.5% in 2022, and 3.0% in 2023, well beyond inflation projections.
Millions of Britons were forced to work and study at home in the past 17 months as the government enforced lockdowns and restricted travel to contain the coronavirus pandemic. The current situation is seen to boost demand for more living space as people adapt in a new setup.
However, the cheap cost of borrowing will sustain how price affordability.
The Bank of England cut interest rates to a record low of 0.10% and restarted its bond-buying program, lowering the mortgage payment for a home.
According to property website Rightmove, the average asking price for a home is 337,371 pounds ($461,962) this month. The figure is more than 10 times the average British wage.