House Prices in UK Reach New High as Home Buyers Seek Dream Dwelling

House Prices in UK Reach New High as Home Buyers Seek Dream Dwelling

Home buyers have been pushing to get their dream dwelling despite that pandemic lockdowns appear to be a part of our past and not our future. It was during the global pandemic that many found their homes lacked the ability to fill their needs with the new lifestyle they were forced to adapt to or choose due to the circumstances. The desire for better accommodations to work from home, study, do fitness, and fulfill hobbies helped push strong demand onto the housing market.

Low interest rate mortgages and the stamp duty holiday also helped motivate hopeful home buyers to take action and purchase their home.

According to the Office for National Statistics (ONS), in March house prices grew in the UK at the fastest rate since August 2007.

The average house price grew by 10.2% in the year to March and by 2.1% from the previous month of February. The average property was recorded at £256,000 in March. This is an increase of £24,000 over the level recorded from March 2020.

In a breakdown of the regions, the highest annual growth rate was in Wales and Scotland with London still remaining the lowest in annual growth rate for the fourth month in a row. The lower growth rate for London could be a reflection of people choosing to move away from larger city areas and preferring rural communities during the pandemic and lockdowns.

Low interest rate mortgages have helped fuel the housing market demand along with the first buyer government scheme offering 95% mortgages that will run until the end of 2022.

The stamp duty holiday was originally set to close at the end of March, but was extended until June with a reduction in the tax discount and it completely ending on 30 September. The savings could be countering the higher asking prices and making the housing market still affordable to those that might be closed out once it ends.

Homeowners have been taking advantage of the low interest rates to move home, whether to upgrade to a larger property, downgrade, or to find their own pandemic lifestyle dream home. Other homeowners have chosen to stay put and take advantage of low interest rate remortgages and to release built up equity into cash. Many have then used the money to re-invest into the home and do kitchen rebuilds, upgrades, or improvements.

The housing market is being forecasted to stand on its own throughout the year, even as the stamp duty holiday comes to a close and interest rates begin to edge upward with the lowest interest rate deals expected to begin to disappear from offerings.

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