Housing Market Performed Last Year but Will This One Be As Strong

Housing Market Performed Last Year but Will This One Be As Strong

The housing market through 2020 showed resilience and surprised even the most optimistic of those offering forecasts back when the pandemic started to impact the economy. However, despite lowered interest rates that would be expected to attract home buyers, demand grew even stronger. The need for a pandemic lifestyle dwelling became more important as lockdowns occurred and it was obvious Covid-19 wasn’t going away anytime soon. Spaces for working at home, studying areas for the children, and other home life needs pushed action for first time buyers and home movers to buy.

According to Halifax, the past year ended with house prices gaining an average 6% over 2019. The UK average house price hit a record high in December of £253,374. 

Other factors contributed to the housing market’s positive outcome such as the stamp duty holiday that offered big savings to home buyers. The stamp duty holiday is due to expire at the end of March. Experts believe the tax relief was as much a motivator as the low interest rates available with mortgages as it helped put buyers into higher value properties than they would be able to afford without the savings.      

Russell Galley, the managing director of Halifax, remarked, “Prices soared as a result of pent-up demand, a desire among buyers for greater space and the time-limited incentive of the stamp duty holiday.

“With the pace of the UK’s economic recovery expected to be constrained by the renewed national lockdown, and unemployment widely predicted to rise in the coming months, downward pressure remains likely as we move through 2021.”

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