Property Update – May 2021
“With demand and price at an unprecedented high, now is the time to act.”
By Jemma Holden, Managing Director
BUYER DEMAND MAKES HUGE JUMP
In the week following the Budget announcement, buyer demand spiked by 24% as people scrambled to take advantage of the stamp duty holiday extension.
Overall demand was also 80% higher in that same week compared to the same time period over the previous four years, due to a combination of the tax break and the ‘search for space’ triggered by the Covid-19 pandemic.
But the supply of new homes coming on to the market remains constrained, putting further upward pressure on prices, according to our latest House Price Index.
These factors contributed to annual house price inflation of 4.1% in February, more than double the rate of 1.8% recorded in the same month of 2020.
Unsurprisingly, the mismatch between supply and demand is continuing to drive house prices higher.
The typical value of a home is now 4.1% higher than at the start of the first national lockdown in 2020, with prices rising by an average of £8,907 during the past year or £750 a month.
February marked the fourth consecutive month during which house price growth was above 4%,
The continued search for space, combined with the stamp duty extension and mortgage guarantees, looks set to support activity levels and headline house price growth up to the end of Quarter 3, 2021.
However, after this marker, property prices will surely have to start coming back down towards the end of the year unless the economy has a boost in employment levels once everything re-opens and we get back to some normality.
Therefore, given the recent spike in demand for property, if you are thinking of moving home, now is the time to act.