March 2020 update: Once the lockdown restrictions ease, activity levels will likely rise, possibly to levels in line with the usual busier seasonal periods in Q3 and Q4.
Sales agreed are currently 4% higher than pre-COVID-19 levels – despite prolonged market closures in Scotland, Wales and Northern Ireland
Increased levels of demand, and a reduced availability of homes for sale, is putting upwards pressure on house prices. Elevated levels of demand and less available supply of homes for sale, which are 15% lower than a year ago, means upward pressure on house prices – for example, the asking price of homes sold in June are up 7%* year-on-year.
UK house price growth to remain within the +2% to +3% range over the next quarter, with downward pressure on prices materialising later in 2020
According to this month’s UK House Price Index by Zoopla – the UK’s leading property resource, the surge in demand for property is expected to delay house price falls, pushing them towards the end of 2020. With an oversight of the market and increased sales levels across London offices I agree with this sentiment.
Housing demand moderates off of a high base
The spike in demand after the market reopened is beginning to translate into sales agreed, now that sufficient lag time has passed. Sales agreed have now rebounded to pre-COVID-19 levels.
Continuing demand is also driving much-needed new supply, as households searching for homes will then list their own homes for sale.
Demand for housing remains 46% above the levels of early March, but it has started to weaken over the last two weeks – falling 8% since 11 June. This is not surprising given the sheer strength of the initial boost in demand.
London city index – detailed view
Our full breakdown of price across Greater London indicates annual growth ranging from +2.7% in Hillingdon to -0.7% in Enfield
David Ross mentions “Estimated price growth is set to hold at 2-3% over the next 3 months. With limited higher LTV products available in the market and strong bidding taking place among buyers, the first-time buyer market will be squeezed tighter. This segment accounted for 25% of mortgaged sales last year.
“We’re entering a phase of supply and demand rebalancing, as reopened markets across England, Wales and Scotland look to replenish the missing 15% of stock compared to this time last year.
“With the winding down of furlough schemes and employment uncertainty still on the horizon, the economic effects of COVID-19 on the property market are yet to be fully realised.” Data ref (Hometrack House Price)
With accessible mortgage products plentiful, bank of England rates at a all time low and fantastic mortgage terms, its a savvy time time to buy. Investors or residential seekers alike whom may have been on the fence pre-covid 19 are making the most of these conditions and jumping into the ‘buyers market’. As the market changes so do the tactics needed to utilise it.
For advise on your investments purchasing or selling, do not hesitate to contact me.
Elliot Rainbow | elliot@ernest-brooks.com
The South Quay Building, 189 Marsh Wall, Canary Wharf, E14 9SHInstant valuation
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