Greycoat Real Estate on Probability of Housing Crash
Greycoat Real Estate on Probability of Housing Crash
The UK’s inflation rate and the cost of living have been on a gradual upward trajectory, affecting property prices significantly. According to Greycoat real estate experts, property prices started to fall in July, the fastest since the global financial crisis.
However, things are improving in terms of mortgage approvals, which increased in June, albeit still below normal levels. The key to this is the 13% rate hikes from the Bank of England. Greycoat adds that the share of world share prices of UK homebuilders has had a good month, boosted by Britain’s inflation rate, dropping to its lowest level in 15 months.
The Real Estate agency says home prices have stayed resilient, and the housing market remains overvalued, with a 16% gap between the price of a house and what the fundamentals can justify. Greycoat Real Estate affirms that we expect more of a slow puncture than a crash, and house prices may fall by 10% from last year’s peak, and this is not a crash.
For a crash to happen, there must be a surge in unemployment. The UK government has been so reliant on the rate of mortgages, and if mortgages go any higher, we may have a housing problem. It may not be a crash, but a crash-like event, says Greycoat Real Estate.
If mortgage rates go much higher than it is, that would become a problem because people are already stretching themselves quite far, Greycoat finally adds. It’s, however, promising as we are moving into the part of the year, which is traditionally calmer for the housing market.