In 2022 there is a raft of mainstream media articles about the property market and the challenges around homeownership for a first time buyer. While it may seem like these struggles are only present in the UK market, in fact, it’s the case across the globe as Millennials navigate through record-setting house prices.


With so many statistics and opinions floating around, you may be thinking – is 2022 a good time to buy my first home? While many experts have their views on how the property market will perform over the next few years, without a crystal ball, no one can predict this with certainty. With that being said, a first home buyer who is ready to jump into homeownership should consider 2022 as the year to learn about buying a property. This blog will take you over a few key points and the latest statics on why we think this is.


What are the experts saying about the property market in 2022?

A recent study from Zoopla states that “buyer demand levels are still elevated more than 50% above the 5-year average, and this has put more upward pressure on pricing”. While that has been the case recently, there is growing evidence that the recent interest rate raises (in fact, four this year alone) are making mortgage rates more expensive. Coupled with rising costs such as income tax, energy costs, and petrol prices, this will likely put significant pressure on homeowners and result in more caution and may serve to act as a brake on property price increases. It is no longer realistic to believe that we will continue to see the double-digit growth of the past few years.

Another Zoopla statistic claims that “the average home across the UK has risen in value by 13% since the start of the pandemic, taking the average house to just under £250,000”. As we have mentioned, it is no longer realistic to believe that we will continue to see double-digit growth given the cost-of-living pressures being faced by many. The question is how far the property will slow and how this will impact the first time buyer and their aspirations to buy a property. 

There is no doubt that mortgage costs will be higher indeed Capital Economics have forecast mortgage rates to double from 1.8% in March 2022 to 3.6% in March 2023. However, these rates remain historically low, and news outlets stating this is the most significant percentage point increase ever seen sells newspapers. However, you need to keep perspective. We still enjoy a low interest regime.


What do I need to know about buying my first home in 2022?

What if the property market falls in price? Does this help the first-time buyer? We don’t believe it does. Even if property does fall in price, the rising mortgage costs will negate the fall. Perversely the amount required for a deposit may also increase as lenders become concerned about price falls affecting the assets security.

With all the gloomy stuff out of the way, let us walk you through what the first time buyer should consider in this property market. Often, when you hesitate buying a property, you may have to compromise on what you can afford, as when mortgage rates rise, so does the required deposits from lenders, meaning the home you desire may become out of reach. The forecasting from Capital Economics predicts inflation of 8.7pc in 2022, and this becomes a significant deterrent to keeping savings in the bank. In real terms, the value of a 10pc deposit on a typical first home would have fallen by £1751. Meaning waiting for the possible drop in housing prices is not worthwhile.


Why is 2022 a good year to get into the property market?

As a first-time buyer can you afford to gamble on a possible fall in price?. We have argued that any potential fall may be negated by the increase in deposit and borrowing costs. The government’s ‘Help To Buy’ scheme which has helped in the purchase of over 350,000 properties is due to end in March 2023. Time is running out to take advantage of the scheme which has been unquestionably an unmitigated success. Up to 40% of your deposit provided as an interest free loan for five years. You will have to act quickly as applications have to be submitted by the end of October to ensure enough time to exchange contracts prior to the 31st March 2023.  

When faced with the age-old question how will I know the right time to buy? We like to think back to Mark Twain’s famous quote, “Buy land, they are not making it anymore”. The United Kingdom is an island, and it will not get any bigger and what they build on it will not get any cheaper. Property is not often traded like stocks or shares, it is a long term investment, and a home is the centrepiece of your life. If the property market takes a tumble in the next few years, if you are investing in your long term future, this does not matter to the timing of buying a property as a first time buyer. 


Our property experts have curated an online knowledge hub with everything first-time homebuyers need to know about entering the property market, from thinking about homeownership right through to moving in.