As house prices reached an average of £250,000 last month, according to the Nationwide, it’s left analysts wondering just when exactly the cooling off period is going to begin. 

Certainly, even Christmas approaching hasn’t put that many buyers off. Knight Frank’s research though may be worth a look at. They’ve found that come April 2022 there will be more housing supply. That, combined with increased mortgage interest rates should slow things down a bit, they suggest. And yes, the Bank of England did hold their base rate last week, but that hasn’t stopped lenders from already beginning to increase mortgage interest rates. 

Lenders already increasing interest rates

HSBC, NatWest and Nationwide increased rates while the Skipton Building Society removed all of its three-year fixed rates the following day. The number of sub-one per cent fixed rate deals with a 40 per cent deposit are falling rapidly: from 131 to 116 within the past two weeks, and more going daily. 

Last week Leeds Building Society put up rates on mortgages at loan-to-value ratios of 80 and 85 per cent. Having said that, the majority of the interest rises aren’t huge. High street lender Barclays raised its two years fixed rate last week from 0.86 per cent to 0.91 per cent.

Bank expected to raise rates to 1 per cent by end 2020

Meanwhile, the Bank of England does expect to raise its base rate from 0.1 percent by a further per cent – but not until the end of 2022. And that’s according to the Bank’s own Inflation report. It also means that for a typical borrower ie £150,000 over 20 years, it means an additional mortgage payment of £71 a month.

Pandemic preferences and price rises

Meanwhile, the desire for more space sees new entrants into Knight Frank’s list of the most popular locations to move to. Leeds, for instance, made the top 10 for the first time, while Cornwall nudged Richmond-Upon-Thames down a peg. When it comes to property price rises, homeowners in both Liverpool and The Wirral saw the value of their properties increase by 21.6 per cent during the pandemic.

For those still keen to sell, James Cleland, head of Knight Frank’s Country business, recommends January as the time to put their property on the market. Buyers, will still be around, he insists and there won’t be the supply of property that’s anticipated come the spring.

Zoopla’s Head of Research Richard Donnell said the best place to sell right now, according to the portal’s research, is in Wellingborough and Nuneaton. 

“It’s less than two weeks for a property to go from on the market to under offer,” he said. “But it’s fair to say that all regions across the UK have got a time to sell of less than a month.”

Donnell also said the market was very strong in both the Midlands and the North of England. That’s because in both areas housing remains affordable and “there’s almost very few limits on how much people can bid up the cost of housing.”