Spring is traditionally a busy time in the English housing market, but other factors shape buyer activity too. Moving out of lockdown will likely inspire some moves, and the Budget 2021 measures have encouraged buyers to plan their next move.
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Zoopla says buyers have been busy
Information provided by Zoopla suggests there was a 24% spike in demand from property buyers in England and Northern Ireland in the days following the March 2021 Budget. With the stamp duty holiday being extended and the small deposit mortgage guarantee scheme introduced, there was positive news for buyers in the property market.
Zoopla points out buyer demand has been 13% higher than average levels across the whole of last year. Three-bedroom homes have been in particular demand since the Budget measures were announced.
The South-East of England has also seen a spike in demand for one-bedroom and two-bedroom properties since the Budget.
Demand outstrips supply
However, the supply of property is still not enough to meet demand. This is a key factor in why so many industry experts refer to the current situation as a seller’s market.
Gráinne Gilmore, Head of Research, Zoopla, commented: “The search for space is driving continued demand for family homes, which means prices for houses are rising faster than flats, and houses are also selling more quickly. The prospects for the housing market over the next year have improved on the back of Budget. The continued search for space, the stamp duty extension and mortgage guarantees will support activity levels and headline house price growth up to the end of Q2 2021.”
Gráinne concluded by saying; “Yet the pathway out of the lockdown, and the route to a full re-opening of the economy and unwinding of support measures, is unlikely to be simple or smooth. We still expect house price growth to moderate later in the year, but overall transactions are set to benefit from an additional boost following the stamp duty extension and tapering.”
Tahir Farooqui, CEO of private rental platform Canopy, said: “House buyer demand continues its upward surge. The newly announced tapered end to the stamp duty holiday has created a window of opportunity for hopeful buyers to benefit from slashed costs. Some will manage to seize it, while others will be left behind. However, it can’t be ignored that the tax holiday is causing artificial inflation of house prices across the UK, making homeownership further out of reach for many current renters. While 95% mortgages have been deemed part of the solution, the problem remains that hopeful buyers need to be considered creditworthy enough to secure a suitable mortgage in the first place.”