Demand will continue to outpace supply well into next year.
That’s the view of the Reallymoving House Price Forecast, based on an analysis of over 18,000 conveyancing quote forms.
The service expects annual house price growth of 2.3 per cent in January as another strong year begins.
Reallymoving captures the purchase price buyers have agreed to pay when they search for conveyancing quotes through the comparison site, typically 12 weeks before they complete, enabling it to provide a three-month residential property price forecast.
It says the shortage of stock is backed up by low interest rates - and the likelihood that any increase in rates will be small and slow.
Rob Houghton, chief executive of Reallymoving, comments: “Transaction volumes are unsurprisingly down since the end of the stamp duty holiday but the outlook for the housing market in early 2022 is positive.
“The most intense phase of the post-pandemic boom has now subsided bringing about a brief autumn lull, but the fundamental supply and demand imbalance continues to support prices and, while the threat of interest rate rises will give some buyers pause for thought, thanks to stress-testing by lenders most homeowners will be able to absorb small rate rises over an extended period of time without too much trouble.
“House price inflation for first-time buyers has been lower than for upsizers and downsizers, meaning first-time buyer activity levels are reassuringly high at around 54 per cent of all buyers – an encouraging sign of market health.
“An anticipated surge in new listings in the new year will drive activity, boost transaction levels and help existing sellers to complete chains.”