How Long Will Housing Market Frenzy Last?

It is fair to say the end of year activity for the housing market was frantic. With the stamp duty holiday deadline looming, many people were keen to buy property before the end of the year, in the hope of enjoying the significant saving on offer.

At Williams of Petersfield, we have seen this heightened demand for ourselves in the local area. We’ve also stayed in touch with what the leading property portals are saying about the market.

Rightmove tips market activity to remain high for now

Rightmove predicts a 4% average house price growth in 2021 across the UK. The leading property portals states that in December 2020, sales were 53% higher than they were in December 2019. This is the case, even though many deals taking place at the time will not conclude before the stamp duty holiday ends.

Tim Bannister is the Rightmove’s Director of Property Data, and he said; “Our 2021 forecast of a 4.0 per cent price rise is more conservative than the unsustainable 6.6 per cent national average seen this year. There’s likely to be a lull in quarter two unless the stamp duty holiday is extended, but for many buyers its removal will not be make or break, though may lead them to reduce their offers to a degree to compensate for the higher tax, and indeed many sellers may be prepared to help to mitigate their buyer’s financial loss.”

Tim Bannister continued by saying; “First-time buyers will remain largely exempt, so in most cases will be no worse off. The maximum savings of £2,450 in Wales or £2,100 in Scotland are considerably less decisive than the £15,000 available in England for a house costing £500,000 or more, which does however only apply to a small part of the market.”

In November 2020, Rightmove said there were 650,000 sales agreed and in the pipeline. In December 2020, Rightmove states that there were still 650,000 sales agreed, and in the pipeline.

While the property portal believes there were around 130,000 completed or abandoned deals in this time, there was an additional 130,000 sales added. Therefore, moving one month closer to the deadline, there was no fall in the number of sales in the pipeline.

There will likely be a slowdown in the market

Rightmove expects the second quarter of 2021 will be slower. However, there is hope that affordable mortgage rates will allow for modest price growth.

Pandemic-related uncertainties have been around for nearly a year, and Brexit uncertainties for far longer, and record activity month after month has proved that movers are willing and able to act on their new or existing housing priorities” says Rightmove.

The property portal says demand has significantly exceeded supply in 2020. The number of properties placed onto the market for the year to early December 2020 was down by 0.6% compared to the 2019 figures.

However, the number of agreed sales rose by 8.3%. This means the number of available properties for sale in the UK is at a low level, a record-breaking low level.

At Williams of Petersfield, we aim to support the Petersfield community as much as we can, and we know this is an extremely trying time. A lot of people are looking for support and guidance, and if you have any property or housing related questions, we are more than happy to assist you, so contact us today.

Zoopla Insight Into Housing Market Changes

There is no denying 2020 has been a pivotal year in the housing market. The November and December lockdown period has caused many people to further re-evaluate what is important to them, but of course, the housing market has remained open at this time.

At Williams of Petersfield, we know people are looking for guidance and assistance. We work closely with local buyers and vendors, and we have a good feel for what is happening in Petersfield. We also stay in touch with what is happening across the country.

If you are looking to make an informed decision in the property market, we are here to help.

Zoopla are reaching out to buyers and vendors

Richard Donnell, the director of research and insight at Zoopla, recently answered a range of questions on the property portal site.

One topic of considerable interest was the growing gap in the housing market, and the general economy. There is a growing feeling that “we are not all in this together”, and this can be seen in the housing market activity of 2020.

With the House Price Index referring to increasing polarisation in the property market, it is natural people are keen to learn what this means, and how it is seen in 2021.

Richard said; “National measures of housing market activity, such as house prices and sales volumes, are strong. But this picture is not uniform across the UK. There is uncertainty in some parts of the housing market, with rising unemployment and stricter lending among the economic pressures taking their toll. You can see fewer sales in less wealthy markets, where people are more sensitive to economic headwinds.”

Richard also said; “At the other end of the spectrum, there’s more activity in wealthier markets where homeowners feel the recession less acutely. This is also tied to the fact that the housing market in London and the south of England has been quite weak in recent years so it’s bouncing back more than other markets.”

Will there be a long-term impact on the housing market?

When asked about the short and long-term effects of the second lockdown, Richard said; “The housing market is one of the bright parts of the economy, and the government has made sure that it remains open throughout the second lockdown. With people unable to get out and about as they normally would, the second lockdown will emphasise once again the importance of the home. People will keep re-evaluating their home and lifestyle. But despite the furlough and the mortgage payment holiday schemes both being extended, the economic pressures remain.”

Richard was asked what impact the second lockdown will have on house prices. He responded by saying; “It won’t have a significant impact on house prices because the housing market is still open for business. Headline house price growth will continue to rise towards 4% by the end of the year. However, it’s important to remember that there is significant regional variation. Everyone’s homes sit in different housing markets, and what happens to values reflects local supply and demand, as our House Price Index shows.”

At Williams of Petersfield, we aim to support the Petersfield community as much as we can, and we know this is an extremely trying time. A lot of people are looking for support and guidance, and if you have any property or housing related questions, we are more than happy to assist you, so contact us today.

Reliable Broadband Becomes Even More Pressing

With remote working becoming an increasingly popular factor in the housing market, we know people are expanding their property search. An area like Petersfield is likely to appeal to more buyers now, as there is a greater sense of freedom.

Of course, just because people have greater freedom to live further from their place of work doesn’t mean they have freedom from work. There is a need to have a suitable home office set-up, and this means broadband dependability is essential.

If you plan on selling your home, you must ensure your broadband is dependable, as it is a vital factor for buyers in the modern era.

Reduce internet speeds cause problems

A study by comparethemarket.com finds 36% of homes have reported reduced internet speeds. This comes at a time when 74% of households are using the internet more. If this extrapolated across the country, close to 10 million households will have suffered in this manner.

The study indicates more than one in ten respondents’ class their internet connection as “bad”. However, 84% of respondents haven’t yet switched or even considered changing broadband supplier.

80% of people struggling with their broadband say their work is negatively affected by these issues. 23% say they have been unable to work at these times.

Some of the most pressing concerns for users occur when:

  • Multiple users are online at the same time
  • When they have to use video calls
  • When they stream
  • When their service drops out regularly

Holly Niblett is the head of digital at comparethemarket.com, and she said: “The millions of people who rely on their broadband at home for a wide range of reasons – work, paying bills and keeping in contact with friends and family – know first-hand how frustrating and inconvenient a poor internet connection can be. We know from our own research that the COVID-19 lockdown has seen almost three-quarters (74%) of households increase their internet usage, yet many are stuck on inadequate and expensive packages that don’t meet their requirements.”

While there is frustration at broadband problems, only 16% of internet using households in the UK have switched or are considering switching.

There are many reasons to switch service

Of the people who have switched, the following responses have been found:

  • 48% switched for a faster and more reliable service
  • 44% of these movers have chosen to pay the same or less for a better service
  • 38% of people switching did so to ensure their broadband and TV package come from the same provider

Holly Niblett added: “In shopping around for a better deal, customers have access to a range of fast and affordable broadband packages that can cost less than their existing deal. When comparing broadband packages, customers should be mindful that many providers bundle broadband with TV packages, which can work out cheaper than purchasing the two separately.”

 

 

At Williams of Petersfield, we aim to support the Petersfield community as much as we can, and we know this is an extremely trying time. A lot of people are looking for support and guidance, and if you have any property or housing related questions, we are more than happy to assist you, so contact us today.