Halifax has reported that in November 2020, house prices increased by over £15,000 since June 2020, which is the biggest growth for five months since 2004, with the latest mortgage approval figures rising by 1.2%. Therefore this means that the yearly growth for property prices have increased by a whole 7.6%. The housing market seems to have been fuelled by a number of reasons, these including the stamp duty holiday until the 31st of March 2021, change of priorities/jobs following lockdown and the pent up demand of lockdown itself. Even though the economy is struggling heavily currently, the property market itself has been extremely strong. Originally it was thought that the market would struggle due to the recession, however it has been far from that, with the UK national average of a property according to Halifax being at £253,243.
It was originally thought that while the stamp duty holiday draws in, that those looking to put their property on the market would start to slow, however it seems that the change of priorities from a property completely outweighs the saving of a few thousand, when prices have gone up by more than that. There has been a notable increase for Evolution Properties with first time buyers purchasing properties which need a little bit of TLC, with the opportunity to add their own personal touch on the property to create it into a great first home. However it must be noted, as prices have increased, short term mortgages with lower deposit rates for these buyers are getting harder to come by, therefore have less money to put into work within the property.
When the Pfizer vaccine was released, there has been a noticeable increase once again, which for this time of year is noticeably busier than years before within the market. This could be due to Christmas this year being somewhat different than previous, therefore the increase agents would normally see in January, seems to have been brought forward. There seems to be a higher level of urgency to make sure a property completes by the end of March as well, to make sure there is some saving to be made, while it's still available.
There is a level of uncertainty of what the market will do in April, 2020, as there has not yet been a release from Government on whether the stamps duty holiday will be extended. Some are conspicuous that if the stamp duty holiday ends, prices of properties will drop, yet the market is still extremely strong and has completely exceeded expectations of what would happen following lockdown.
This has also been reflected in the rental market, with currently a larger amount of applicants compared to rental properties, meaning that the prices of the properties are also increasing, following the rest of the market. Landlords who are unsure about placing further properties on the market should feel comfortable currently, as due to the amount of tenants compared to properties, it is currently a Landlord's market. Homelet argued that in November 2020 the national average for the UK rental price was £974 PCM, which is a rise of 2.9% compared to last year. For those outside of London, the rental market increased by 5.6% from last year, creating an average of £828 PCM.
READ MORE: https://www.bbc.co.uk/news/business-55143223
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