UK Housing Market Rebounds with ‘Mini Boom’ in July

September 11, 2020

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Article Summary

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  • As well as improving on pre-lockdown prices, July also saw an annual increase of 3.7% on property prices. House prices are now at their highest levels since 2016.

  • Buyer enquiries in July were a massive 75% higher than at the beginning of 2020. With 44% of the 92,085 listings added in the month after the market reopened now sold.

  • The government’s announcement of a stamp duty holiday has impacted demand for property, with Rightmove recording a 35% rise in the number of sales agreed in the five days following the news.

The UK housing market showed strong signs of recovery after the coronavirus pandemic in July. With Rightmove reporting house prices beating pre-lockdown levels by 2.4%. These new figures should come as a great assurance in the resolve of the country’s housing market for those who want to invest in property here.

 

Invest in property – All-round improvements

As well as improving on pre-lockdown prices, July also saw an annual increase of 3.7% on property prices. House prices are now at their highest levels since 2016. With the average price of a property listed in July reaching £320,265.

This growth has driven up by an unprecedented level of demand. Buyer enquiries in July were a massive 75% higher than at the beginning of 2020. With 44% of the 92,085 listings added in the month after the market reopened now sold. This is compared to 34% for the same period in 2019.

This fantastic performance is in stark contrast to the doom-and-gloom forecasts from the beginning of lockdown. It is a perfect example of the resilience and security of the UK housing market, showing there is no better time to invest in property. 

 

Stamp duty effect

At the beginning of July, Chancellor Rishi Sunak declared; stamp duty will be placed on hold for all purchases up to £500,000 until next March. A scheme previously suggested by property professionals as a way of boosting the market

It has worked. The government’s announcement of a stamp duty holiday has certainly impacted demand for property. Buyer demand is rising significantly. With Rightmove recording a 35% rise in the number of sales agreed in the five days following the news.

Those looking to invest in property are also eligible for the tax cut, but will still have to pay the extra 3% of stamp duty charged on additional properties. This will still mean huge savings and higher returns, something property investors should take advantage of.

 

Future positivity

This boom isn’t just a blip . Experts predict that this is actually the start of great things for the UK housing market.

Marc von Grundherr, director of Benham and Reeves, said, “Prices are up, enquiries are through the roof and sales are being agreed like billy-o, and that’s even before the effects of the temporary stamp duty reprieve have had time to kick in.

“Hold on tight folks, we’re in for a fast ride over the next few months. Prices will rise further as a consequence of this unprecedented demand.”

James Forester, managing director of Barrows and Forrester, also forecasts good things for the future. “While the market will return to a more familiar form of ‘normality’ as this demand levels out, it has truly defibrillated any fears of a downturn in home values.

“In addition to this, the government’s continued failure to address the UK’s housing shortage will ensure that even when buyer demand returns to normal levels, prices will remain buoyant due to the supply and demand imbalance.”

 

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