As of August 2022, house prices in the UK are the highest that they have ever been when compared to median income.

Prices in the north-west may have remained lower than most of the country, and especially the south, but they are still rising faster than ever before.

Whether this is a good thing or not will depend on who you are asking, and what your own personal circumstances are.

Because we are based in in the city, we have seen first-hand the effects of Liverpool house prices rising.

Read on to find out what are the advantages and disadvantages of rising Liverpool property prices, especially concerning property owners who may be looking to quickly sell their house.

Are house prices going up?

Yes, house and property prices are increasing and have been since 2020. The rate that house prices have been increasing by is largely dependent on their location.

When you look at annual price increases, the north-west is the region with the 7th highest annual price growth at 6.2%, behind:

  1. East (9.7%)
  2. East Midlands (9.3%)
  3. South East (8.9%)
  4. South West (8%)
  5. West Midlands (6.6%)
  6. London (6.3%)

When you look closer, the overall average property price in Merseyside (the majority of which were semi-detached houses) was £201,926. This is a 16% increase from 2019 prices which topped at £174,080.

Of course, in some areas within Merseyside prices are considerably higher than average. As would be expected, this is especially the case for more affluent areas such as Caldy, Formby, and Hightown, yet prices have also been rising quickly in some more unexpected areas too like St Helens.

It may feel like house prices are rising uncontrollably, however, at the time of writing, property prices are beginning to slow. Year to year house prices are down in June 2022 when compared to May 2022, likely due to incentives that were pushed in 2021 to help keep the housing market strong following the pandemic.


Benefits of rising house prices

Homeowners benefit the most from house prices rising. They have the option to either release equity from their property by remortgaging, or sell their property and take advantage of the inflated value.

Releasing equity is a great way to raise funds to renovate a property, which in turn will increase the price of a property even further.

If higher property prices stick around, then this can lead to an influx of new-build properties on the market as companies have an incentive to capitalise on higher profits. This may offer more people the chance to get on the property ladder if they are able to purchase their own property.

Negative effects of rising house prices

Young families and first-time buyers are disadvantaged the most by rising property prices as it becomes more and more unaffordable for them to move into their first home.

With higher prices, lenders require a higher deposit to satisfy their loan-to-value ratios. This means that previously affordable properties may become unaffordable for some, and even for people who can get a mortgage, they will have increased debt as their mortgage payments will likely be higher.

If people cannot buy their own homes, then they may have to rent. And if there is a large number of tenants seeking rental properties in an area, then the price for rent will increase as demand outweighs supply.

What will happen to house prices?

There are many variables that will dictate what happens to property prices. In 2022, we are potentially heading towards a recession which could put a stop to the trend in rising house prices over the past few years.

Then there’s also the rapidly increasing cost of living to consider which means that most have less buying power than previously. Combine this increased cost of living with a recession and you have high interest rates, unaffordable mortgages, and less money to go around which will reduce the demand on housing. If demand for housing decreases, then prices will also decrease.

It is worth noting that a recession is not set in stone. Yet even without a recession, for many people housing may still become unaffordable soon. And now that we are past a surge in demand for housing during and post-covid, we will reach a point where demand will slow. Just how much this will impact house prices is uncertain.

A great offer on your property from EasySale

Whether you need a quick sale to salvage your property chain or want to capitalise on increased property prices, here at EasySale we can quickly buy your home for cash.

We offer up to 85% of market value and can get sales completed in under a week, freeing up cash for you which may be needed during the increased cost of living crisis.

Get in touch with our team and we will reply within 24 hours with our free valuation that you have no obligation to take. What have you got to lose!

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