This year began on a high for housing, with numbers of buyers, agreed sales and numbers of properties for sale all shown to be on the rise at the beginning of 2020, with house prices rising in parallel. For the first time in six months, the whole UK began to follow the trend previously seen in London and the South East, with figures in all areas continuing to move upwards for the second month in a row.
However since then, COVID-19 has made itself known, and uncertainty is now the term most used to refer to many things in life - especially in relation to anything to do with money.
So what does this mean for the housing market? How much might your home actually be worth? Will anything change dramatically?
Moving on hold, but not forever
Like many businesses, estate agents across the country have been forced to close their doors and work virtually. In conjunction with this, social distancing measures mean that moving to a new house has become more difficult than before. There are basic recommendations not to move if you can help it, but with the right social distancing measures in place and when you work with a reliable and responsible agent, it doesn’t have to be completely off the cards.
People still need to move house and it is not always possible to put the their life on hold. There are mortgages available, the Bank of England interest rate is lower than it has been in many years and with the government committed to protecting incomes, there are still many positives to see in the housing market if you’re looking to move or sell.
Price bounce-back on the cards
Whilst right now house sales are stagnating, once COVID-19 restrictions are removed it is predicted that prices will bounce back to where they were, and continue to rise – albeit less quickly than previously forecast.
The property market in the UK is fairly robust, and given the right conditions, should resume along the same path it was already taking. Processes put in place to support homes and housing during the pandemic could actually prove beneficial generally, with innovative virtual house viewing processes developed throughout lockdown and Government support for mortgages and limitations on forced sales helping to boost the market and get it going again. Mortgage rates are currently very low, and although a large number of mortgages were initially removed as an option by lending companies, these are starting to re-emerge – it’s a great time to apply for a mortgage if you’re hoping to move in the near future; and great news for current owners as there may well be a surge of interest from people who want to move.
The actual economic impact of COVID-19 remains to be seen, but it seems likely that the measures put in place to support people to stay in their homes and keep their employment will avoid any surplus of housing on the market due to people being forced to sell up. So, the supply stays the same, the demand is likely to be the same or higher, at least for a short time – and if interest rates stay low, the news could be good for home owners and house prices.
Overall, it’s impossible to say what will happen and when – but whilst the future may not currently be as bright as first expected at the beginning of 2020, it’s certainly nowhere near as dark as you might have thought either.