The UK lockdown which began in March brought a halt to the everyday activity of most businesses.
Although some companies were obviously harder hit than others, no industry was left untouched; including the property industry.
In May, when the lockdown was still in place but beginning to ease, Nationwide’s house pricing index noted UK house prices fell by 1.7% from April – the largest decline for 11 years.
Although this did of course bring cause for concern, the property market has been showing promising signs of revival.
The post-lockdown boom
Homeownership interest was fuelled by the pandemic-driven stamp duty cuts and the threat of another lockdown meant an increased desire for more spacious homes and gardens.
Although we have obviously not fully returned to how things previously were and we are still trying to figure out what the “new normal” actually is, it is fair to say that the property market is currently thriving rather than simply surviving.
Data from Halifax showed that house prices in the UK were at an average of £245, 747 in August, a huge 5.2% rise since August 2019.
UK housing prices have now hit a record high, post-lockdown.
The recent success in the market can be put down to the surge of pent up demand from those who were forced to put their purchasing plans on hold at the start of the year, along with the increased motivation to buy as a result of government incentives including tax cuts.
Where are housing prices rising fastest in the UK?
The South East and London more specifically remain enticing options for buyers and although London did not see their prices increase with the surrounding cities, the capital property prices remain the highest in the country at £475,100.
Is Britain’s house price boom destined to be short-lived?
There is an understandable concern for property developers that the UK housing market’s mini-boom will be heavily hit when the tax cuts end on 31st March and furlough ends on 31st October.
Although uncertainty in the market can leave developers wondering whether they should postpone their project plans, they should keep in mind that there is always an element of risk in the market and we can never truly know how the market will turn.
Figures gathered from completed housing transactions show that average house prices increased over the year in England to £252,000 (2.9%), Wales to £169,000 (4.8%), Scotland to £155,000 (2.1%) and Northern Ireland to £141,000 (3.8%), according to the ONS.
A steady increase for the country as a whole does suggest some stability, and the good thing about the spike in housing prices means that even if things do slow down when the tax cuts and furlough scheme ends, developers still remain in a lucrative position, even if housing prices return to the prices they sat at in 2019.
The lift on schools and the reopening of businesses in the past couple of months should provide a boost to the market and create more buyers.
Additionally, if the property market is showing signs of slowing down, this has a knock-on effect for example on contractors and suppliers for building materials which will help keep costs down during the building phase.
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