It was never expected! No one could predict how it would end—boom or crash. The uncertainties surrounding the housing market due to the pandemic have left many homeowners with no other option than to fold their arms.
Surprisingly, the aftermath of coronavirus has brought a smile to investors’ faces, with housing demand reaching a record-breaking ten-year high. The average sales price for existing homes jumped to an all-time high of £329,100, marking a historic annual rate of 17.2%. March’s national price rise commemorates 109 consecutive months of annual gains.
Report from Rightmove
A report from Rightmove has revealed that the implementation of lockdown measures, accompanied by new government incentives, has led to a surge in housing demand, making this spring the strongest seller’s market in the past decade. Rightmove expects further price increases during the traditional spring selling season and suggests that “the current boom in the housing market is the largest we have experienced in the last decade.” Selling your property this Easter could be a significant opportunity.
Data published by the portal this week shows that the UK is currently experiencing an all-time excess demand compared to supply over the past ten years. The statistics indicate that this year’s demand is 34% greater than last year’s (considering this same period), pushing the market average price of homes to £2,484 this month. The trend further explains that homeowners are willing to sell, as agreements have been reached for two-thirds of the properties listed for sale.
Demand for Property
In the words of Lawrence Yun, the NAR’s chief economist, while consumers are facing rising interest rates, low affordability issues, and higher home prices, there remains a strong demand for homes in the market. He added that if there had been sufficient homes listed in March, sales would have been measurably higher. “The interest rate is still favourable despite the increase, and the economic forecasts look promising,” said Yun.
With more than 50% of adults vaccinated, the report shows that housing statistics and employment data signal optimism for more supply and robust demand in the housing market.
Rightmove’s Director of Property
Tim Bannister, Rightmove’s Director of Property Data, commented, “Concerns of a cliff edge for the housing market at the end of March have dissipated due to tax deadline extensions throughout the UK, except Scotland, and the high level of buyer demand resulting from the lockdowns.
“This high demand for property is expected to increase from April with new government guarantees enabling lenders to bring back 5% deposit mortgages. Although it may not be the perfect time to buy for some people adversely affected by the pandemic, the record buyer demand measured by Rightmove shows that now is the right time for many. Record low interest rates and the new focus on what homes need to offer after several lockdowns have led us to the highest excess of demand compared to supply in the last ten years. This strong seller’s market is favourable news for those looking to put their homes on the market as the traditional Easter selling season approaches.”
Bannister continues, “Many sales have been agreed in the last few months, and there is a shortage of homes available for sale. A higher supply to match the high demand for property would alleviate upward price pressure. Price rises will also be influenced by the strict lending criteria imposed by the Bank of England on lenders following the Mortgage Market Review in 2014.”
James Forrester, Managing Director of Barrows and Forrester, added that if you’re considering selling, now is the best time to do so because you’ll be able to take advantage of these favourable market conditions, which will reduce the time it takes to find a buyer.
