There is a wealth of uncertainty at the moment, with one of the major worries for households up and down the country being the cost of living crisis.

The prices of everyday essentials have risen astronomically – everything from fuel to food and energy and a range of opinions have emerged on what will happen to the property market as a result.

Before you assume the outlook for the value of your home is going to be gloomy, there may be some light ahead in Brentford.

We ask: will the cost of living crisis affect house prices?

Where are we now?

In April the average price of UK property was up 10.8% on the same month last year, and the average cost reached a record high of £286,079, according to the Halifax.

The result of the longest run of increases since 2016, this property boom, fuelled by the Covid pandemic, and the first lockdown in particular, defied economic conditions.

As well as Covid, low interest rates, the stamp duty holiday and a desire to relocate to bigger homes with more space have all driven house price growth.

"Housing transactions and mortgage approvals remain above pre-pandemic levels, and the continued growth in new buyer inquiries suggests activity will remain heightened in the short-term," said Russell Galley, the managing director of Halifax.

"The imbalance between supply and demand persists, with an insufficient number of new properties coming on to the market to meet the needs of prospective buyers and strong competition to secure properties driving up prices," 

It isn't just the cost of living that is squeezing household budgets but also mortgage rates.

The gap between house prices and earnings continues to widen, reports the Office of National Statistics (ONS): the average cost of a home in England rising from 2020 that saw 7.9 times earnings to an average of 9.1 times earnings.

As a result, home buyers are struggling to build larger deposits, forcing many into staying in long-term rentals. Nationwide reports that seven in 10 have now postponed their house-buying plans for at least two years.

Where are we headed?

The market has started to slow, confirmed by the Halifax's monthly property index which states the rate of growth in April is down from March. "Even though there is a lot of caution about the future economic landscape, it seems that limited supply available on the market, coupled with steady demand growth, are still the overriding drivers of house prices," said the latest RICS Residential Market Survey. 

Despite this increasing financial tightening, industry experts still don't believe we are headed for a crash. 

At Leslie & Co. we do not expect house prices to fall in Brentford – but we do think that the rate of growth will start to stagnate.

Russell Galley, the managing director of Halifax states: "The headwinds facing the wider economy cannot be ignored. With interest rates on the rise and inflation further squeezing household budgets, it remains likely that the rate of house price growth will slow by the end of this year."

There is no doubt that your finances are under pressure this year, but one thing that we know from the last couple of years is predictions are difficult to make.

Rightmove's Tim Bannister commented: "With so many variables affecting house prices and affordability, it's a reminder that the market is extremely difficult to predict, and those looking to buy will be prioritising their own needs and what they can afford rather than waiting to try and time the market."

We understand that you may have specific questions related to your home and personal circumstances.

Our team is always available – call 020 3488 6445 or email [email protected].