UK Housing Market Predicted to Have Stellar Year Not Seen in Over a Decade

UK Housing Market Predicted to Have Stellar Year Not Seen in Over a Decade

The UK housing market has been a bit of entertainment for those watching. It would have been the bet of the decade had someone offered odds on the market outperforming all expectations and actually thriving during a global pandemic. Yes, it has surprised, and not only has it surprised experts, but it continues to cause them to reissue forecasts as the demand pushes strongly onward and upward.

Property website Zoopla has recently issued a new projection that the housing market in 2021 will be the busiest it has been in 14 years. 

The housing market is expected to reach a level of homes sold at £461 billion for this year. That would be an increase of 46% over 2020 which experienced the start of the pandemic buying boom.

The Office for National Statistics (ONS) reported a 10.2% increase in the annual average house price for March. It is the largest annual growth rate since August 2007 which was prior to the financial crisis.

The reason for the buying boom is multi-layered. There are those taking advantage of low interest rates and the new government guarantees for mortgages offering an opportunity to buy with a lower deposit level. The stamp duty holiday set to decrease at the end of June and end completely by the end of September is also a factor motivating buyers. Perhaps the biggest motivator was the pandemic which pushed a desire to own a property that better suited pandemic and post pandemic lifestyle needs. 

The dream home wish list could include a private area to work from home, a place for children to properly study and learn, an area for home fitness, more greenspace and a garden for outdoor respite, an upgraded kitchen, and areas to provide entertainment at home opportunities such as board games, puzzles, streaming movies, online gaming, and hobbies.

Not only has the housing market benefitted from the buyers demand, but so have side businesses that are connected to setting up a new home or moving. 

Meanwhile, there are homeowners that have chosen to stay put and not move home. They are finding that upgrading and improving their existing home to be the right choice for them. Many are choosing an equity cash release remortgages to fund the improvements which in turn could in some cases increase the value of the property. 

The demand from hopeful buyers will continue to be strong say experts, but it is also expected that many will be shut out of the opportunity to climb onto the property ladder as asking prices increase and supply remains low throughout 2021.

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