Previsioni Parte Uno

In the twilight of September, a profound realization began to take hold within the realm of housing market prognostication—an unequivocal understanding that the trajectory of mortgage rates, akin to a tempestuous wind, possessed the potential to impose stringent constraints on the quantum of debt buyers could prudently secure. This emerging insight gained greater salience against the backdrop of the tumultuous aftermath that followed the unveiling of the mini budget—a seminal event that sent reverberations throughout the mortgage market, prompting lenders to expeditiously withdraw a staggering 40% of mortgage products from the once fertile marketplace. As if an ominous omen, the average quoted rate for a 2-year fixed mortgage, according to the venerable data purveyor MoneyFacts, audaciously breached the hallowed 6.0% threshold, casting a pervasive air of disquietude.

The ramifications of these tumultuous developments, their profound ripples coursing through the housing landscape, extend beyond the mere ebbs and flows of house prices and transaction volumes, tethered intricately to the capricious whims of mortgage rates across a litany of products and the duration of their meteoric ascent. Yet, one must cast their gaze deeper into the chasms of understanding, for the precipitous occurrences witnessed within the money markets throughout the halcyon days of Autumn in the year 2022, though not entirely without precedent, elicited gasps of astonishment. These sudden, vertiginous spikes in mortgage rates represent not a mere reflection of sanguine expectations surrounding the base rate in the fateful years of 2022 and 2023, but rather serve as an indelible testament to the labyrinthine uncertainties encircling the UK government’s very capacity to engender and safeguard financial stability in the face of an inclement economic tempest.

To assuage the perturbations sown by this tempestuous brew, the hallowed halls of governance resorted to a resolute transformation of personnel and policy, a panoply of measures and reversals aimed at restoring an ephemeral equilibrium. Alas, while these well-intentioned endeavors may, to some extent, alleviate the pressures borne by prospective buyers in their earnest pursuit of housing, the lingering specter of exigent affordability constraints looms ominously on the horizon, casting a long, inescapable shadow.

As we cast our gaze further into the haze of the future, guided by the steadfast predictions proffered by the esteemed Oxford Economics, a glimmer of hope begins to flicker amidst the murky labyrinth of mortgage rates. A gradual easing of lenders’ margins, both in the realm of variable and fixed rate products, emerges as a beacon of respite from the current elevated stratum. However, set against the backdrop of the anticipated trajectory of the illustrious Bank base rate, mortgage rates, like stubborn sentinels, are projected to maintain their lofty perch, soaring above the clouds of uncertainty throughout the tempestuous seas of 2023 and persisting unabated well into the annals of 2024. Consequently, mortgage affordability, already stretched perilously thin amidst the waning months of Autumn in the bygone year of 2022, shall suffer further tautening, far exceeding historical benchmarks, throughout the vestiges of the present year and the subsequent annum.

Thus, the fates weave a woeful tapestry of portents, heralding the advent of double-digit house price declines in the annus horribilis of 2023—an epoch beset by the trembling hesitation of discretionary movers, their hands frozen in a specter of indecision, whilst both nascent first-time buyers and sagacious buy-to-let investors curtail their once exuberant activities, crippled by the very same affliction of affordability pressures that bedevils them.

Yet, in this saga of affliction, the odyssey towards the distant shores of long-term horizons awaits, its vicissitudes inexorably tethered to the vagaries of mortgage rates, those elusive harbingers of destiny. It is within this realm that the elusive endgame, the grand denouement of our five-year forecast period, takes shape. With bated breath, we envisage a quelling of the tumultuous waters that beset mortgage markets, with a marked reduction in lenders’ margins over the course of the ensuing 12 months, and a gradual subsidence of the Bank base rate from its zenith in the very midst of 2024, its ethereal descent catalyzed by the assuaging touch of tamed inflation.

In this semblance of tranquility, a resplendent dawn emerges—an epoch wherein mortgage affordability, akin to a phoenix, rises from the ashes of despair. Conjunctive with the envisaged nominal price ebbs of -10% in the tumultuous year of 2023 (adjusted with perspicacity for the ethereal tendrils of inflation, amounting to a staggering -12.6%), the harmonious interplay of these factors bestows upon the housing market the grace to entice a resurgence of buyers, their resolute footsteps igniting a flicker of life within the marketplace, birthing a renaissance of modest house price growth commencing in the embers of 2024 and rippling onwards. And lo, a more pronounced resurgence awaits, a dramatic crescendo heralding the annum of 2026.

Yet, let us cast a discerning eye upon this tableau, for even as the fates guide us through this intricate dance of projections and prophecies, we must remember the delicate balance that besets such endeavors. The market resurgence anticipated within the hallowed confines of the Bank base rate’s potential return to 1.75% by the culmination of our forecast period shall pale in comparison to the veritable maelstrom of recovery witnessed in the market’s halcyon days from 2009 onward. Alas, with measured trepidation, we acknowledge that while the economic tribulations that envelop us bear less intractable fortitude than their predecessors of three decades past, the road to redemption shall be neither as protracted nor as fraught as the days of yore witnessed within the tapestry of the early 1990s.

Thus, amidst this intricate tapestry of forecast and foresight, we are compelled to invoke a profound reminder, a clarion call to the annals of prudence—if ever needed—that the events of the past, though etched within the annals of our collective memory, provide naught but a fragile guide, a whimsical beacon illuminating the swirling mists of the future. As we traverse these uncharted realms, our gaze fixated upon the future, we must do so with the utmost humility, cognizant of the ever-present specter of uncertainty that interweaves itself within the very fabric of our endeavor.

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