Property Market experts Zoopla has predicted that the current boom in the housing market is likely to surge to its busiest time in 14 years. The value of sales in the UK rose by 46% this year when compared with 2020 although London is still somewhat behind.
This prediction comes after March showed a house price increase of 10.2%, the highest growth rate since before the onset of the economic crisis in August 2007.
The surge has been contributed to by the various government backed schemes which have been designed to promote house buying, such as the Help-To-Buy scheme and the Stamp Duty Holiday as well as the new Government backed guarantees for mortgages. The surge in sales for new homes has also been credited to pent-up consumer demand from a long series of UK lockdowns.
Zoopla expects house sales to reach 1.52m this year which would place 2021 in the top 10 busiest years since 1959.
London is lagging behind the rest of the UK with demand being diverted to family homes outside of London to places such as Wales and Yorkshire. London’s house price growth is at 1.9% which is the slowest regional growth rate across the UK for the sixth month running. Homes in inner London are also taking around 2 weeks longer to complete (a total of 2 months) than the 2017 to 2019 average.
Central London boroughs that were particularly affected by the pandemic such as Westminster, City, Kensington and Chelsea and Hammersmith and Fulham have registered price falls for the third consecutive month.
Analysts do believe that as life begins to return to normal, London will bounce back to dominate the housing market once more.
“The pandemic has pushed London to the bottom of the house price inflation league, but as we face into what seems to be a solid recovery, there can be little doubt that it will soon be gaining places and rising up the table,” said John Eastgate, managing director at Shawbrook Bank.
“With solid fundamentals underpinning the property market even after the end of the stamp duty holiday, there’s a strong argument to suggest that our cities, London in particular, represent good value today for both homeowners and investors.”