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What Happens Next In The UK Housing Market?

It is natural for people to question what happens next in the UK housing market. At David Harris & Co, we have helped many vendors and buyers in Finchley and surrounding areas. If you are looking for guidance on the local market, we are here to help.

 

We also stay in touch with what is happening across London, and nationally. When leading people in the UK housing market speak, we pay attention.

 

Richard Donnell is the Director of research and insight at Zoopla, and he recently conducted a Q&A session on their site.

 

Are you looking for information on what happens next in the housing market?

 

When asked what is in store for the housing market for the rest of the year, Richard said; “Recessions typically impact sales volumes more than house prices. The number of sales is already low by historic standards and we expect it to be 20% lower this year as a result of the housing market being shut for almost two months. We still believe that house prices will end the year 2% to 3% higher than at the start. There are a number of reasons why we don’t expect a major fall in UK house prices.”

 

Richard also said; “Firstly, house prices are rising at low rates and a jump in forced sales seems unlikely. Lenders are supporting existing borrowers and credit is still available for buyers seeking low loan-to-value mortgages. Secondly, unemployment is rising but it appears to be focused on the younger generation who are typically renters rather than homeowners. Thirdly and finally, mortgage regulations restrict borrowers’ ability to ‘bid up’ the price of housing – and therefore limit the downside for house prices.”

 

What will happen to house prices in UK?

 

Richard was asked what the current situation will mead for house prices in the rest of 2020. He responded by saying; “The housing market got off to a strong start in 2020. With lockdown restrictions now lifted, it has taken off again. Government has played a key role in supporting consumer confidence. House price growth is holding steady, with 16 of the 20 cities tracked by the House Price Index recording growth of 2% or more.”

 

Richard continued by saying; “Average prices are increasing at more than 4% per annum in Nottingham and Manchester. It’s also interesting to see the housing markets reigniting in London and south east England. They’ve had weak market conditions in recent years but improved affordability and the recent stamp duty holiday have had a knock-on impact on activity.”

 

The London housing market is facing a few additional challenges at this time. However, the stamp duty holiday is creating activity in the local market. While there has been some media focus on people moving out of London, driven by analysis from Rightmove, this is far from the full story.

 

There will be a significant amount of people unable to work from home, which means many people will not be in a position to leave the capital. There will also be many people and households who have no intention of leaving London.

 

While the employment opportunities on offer in London are integral to people living in the capital, London is so much more than a platform for work. Life in London, including areas like Finchley, offer so much, and there will always be demand for these areas.

 

If you have any questions about the housing market, or you need assistance, please contact David Harris & Co today.

David Harris

UK, Housing Market, Property, Home

19.09.20

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