Halifax HPI: “Sellers scrambling to the auction house before expected crash”, say experts

by | Jun 8, 2022

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Following the Halifax May House Price Index published this morning, which revealed that house prices increased by 1.0% in May, nine mortgage brokers and estate agents share their thoughts.

Andrew Montlake, managing director of the UK-wide mortgage broker, Coreco“The property market is out of sync with economic reality. Everything suggests prices should be coming down and still they rise, if not at quite the same rate as April. However, the house price boom and sellers’ stranglehold on the market will soon be over as inflation takes hold and people’s confidence and spending power are hit for six. Soaring inflation, rising interest rates and the very real prospect of recession ahead will hit demand while lenders are becoming ever more cautious, which will restrict what people can borrow. The rate of price growth will almost certainly slow during the second half of 2022 and into 2023. Few can deny that there is now a phenomenal economic storm blowing in and the lack of supply may not be enough to protect prices.”

Imogen Sporle, Head of Term Finance at London-based Finanze: “Activity in the housing market is dropping, as inflation hits confidence and wallets. We are almost certainly past peak sellers’ market, with vendors becoming increasingly flexible with price. We have seen some sellers scrambling to the auction house to sell their properties before the expected crash. If lenders are being more cautious and factoring in higher living costs, we are not yet seeing that. Property prices look set to drop off, especially if the jobs market starts to creak. Demand may, however, be propped up by overseas investors purchasing properties to let out. By the end of the year, we expect house prices to revert to what they were pre-Covid, with potentially a further decline in 2023.”

Ross Boyd, founder of the always-on mortgage comparison platform, Dashly.com: “Double digit house price growth as inflation approaches double digits is madness. It may be that we’re seeing a last rush of buyers get into a new home before the storm hits. The current rate of price growth, though slowing, simply cannot continue and the second half of the year could look significantly different to the first. With bills soaring across the board, households are battening down the hatches and that will hit bricks and mortar.”


Joe Garner, managing director at London-based property developer, NewPlace: “Though we are still seeing strong demand for our live properties, during the second half of the year our projected sales start to flatline as the cost of living crisis bites and buyers become cautious of making the wrong move at the wrong time. Serious, pre-qualified buyers are still keen to complete and are willing to match that desire with strong offers, as much as 5% above asking price. Both the number of serious and even window shopping buyers does seem to be dwindling, though. Lenders are not only being more cautious but stock levels are reducing even further. If the jobs market starts to weaken, we are likely to see an impact across the full spectrum of transactions from first-time buyers to downsizers. We feel there may be a potential reduction of 10% to 15% in house prices for second-hand transactions, particularly at the higher end of the market as the impact of the cost of living crisis and shaky jobs market create uncertainty and fear. New build property prices are likely to stabilise and stay at current levels as supply remains low in a post pandemic environment.”

Graham Cox, founder of the Bristol-based broker, SelfEmployedMortgageHub.com: “I believe house prices will fall by 5% this year and possibly even more in 2023. Property prices are already coming off their record highs and transaction levels are falling. Mortgage costs, fuel, food and energy prices continue to soar with no end in sight. Throw in National Insurance and tax hikes, the terrible events unfolding in Ukraine and the autumn energy cap increase and it’s a recipe for economic disaster that we won’t see the full effects of until the winter. There is nowhere for house prices to go but down.”

Charles Yuille, managing director of Bath-based independent mortgage broker, Willow Brook Mortgages: “The surreal growth in the property market during the past two years, highlighted once again in April, is about to be hit by very real economic forces. As the cost of living crisis accelerates and interest rates rise to curb the highest inflation we’ve seen in decades, the rate of price growth can only start to cool. The level of price growth we have seen during the pandemic simply cannot continue and will almost certainly drop off during 2022. However, the phenomenal lack of supply will ensure prices stabilise rather than collapse.”


Rhys Schofield, managing director at Belper-based Peak Mortgages and Protection: The housing market definitely seems a bit less frantic but it’s still buoyant with house prices continuing to rise, if not at the same pace. The prospect of an impending crash or bursting of the bubble may make good headlines but is detached from reality. There are significantly fewer properties than would-be buyers who want them and the alternative for many is renting. If you think supply in the sales market is bad, rents are skyrocketing and supply in rentals is even scarcer. All this drives ever more people to try to buy a limited amount of housing stock, which will support prices whatever happens.”

Amey Hellen of Derby-based estate agents, Boxall Brown & Jones: Right now, the market is still really strong and there are plenty of buyers for each property. On some occasions, we have had over 20 viewings for one property in less than 24 hours. It is certainly still a sellers’ market. Vendors are holding out for their price and, more often than not, they are achieving the asking price or offers over. Lenders are always cautious but no more than normal. Purchasers who are on a good salary with at least a 5% deposit are having no issues with finance at the moment. As there is still a shortage of houses generally, the demand will remain strong even if economic conditions worsen. I think that prices at the end of the year will be similar to how they are now as demand is still so strong.”

Lewis Shaw, founder of Mansfield-based Shaw Financial Services: “It’s a certainty that the Bank of England will continue to raise the base rate, which is its only hope of getting a handle on the current inflationary beast and, if we’re lucky, tip us a minor recession. If the Government and Bank of England don’t start to get a grip on inflation and keep drip feeding policy and making marginal rate increases, there’s a real risk rates will need to go far higher, causing a deep recession. If that happens, we would see house prices fall, repossessions increase and unemployment rise.”


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