What to expect from the Housing Market in 2021
-It is quite clear that 2020 has been an unprecedented year! In addition to its effects on the UK’s health system, the Coronavirus pandemic has caused major disruption to the UK’s financial system.
Many industries, trades and markets have seen significant downturns. However, one industry which has shown its resilience through the pandemic and which looks set to continue to grow next year is the Housing Market.
There are several reasons why the Housing Market has seen an upturn this year, with the most obvious one being that many people have re-evaluated their housing needs as a result of the recent lockdown restrictions.
For example, some people may have decided they need a bigger home to ensure they have adequate space so that they can work from home whereas some people who previously did not have any outdoor space have recognised the importance of having a house with a garden.
Interestingly, Rettie & Co. recently reported in their Newcastle Housing Sales Market Review Report for Winter 2019/2020, “that demand is strongest for quality family homes, and larger apartments with outdoor space, as households re-evaluate aspirations and requirements”.
With a challenging 2020 drawing to a close we list below some features which are expected to influence the performance of the Housing Market in 2021:
Demand looks set to continue
Although it is a positive news that a vaccination for Coronavirus is being rolled out across the UK, it is expected that whilst social distancing restrictions remain in place more people will continue to work from home for the foreseeable future.
This could therefore lead to more people continuing to buy bigger homes to ensure they have enough space to work from home effectively.
Alternatively, some people may look to downsize next year in light of the UK Government’s furlough scheme coming to end in March 2021.
It remains to be seen if there will be more people upsizing than downsizing however one thing that remains clear is that demand for properties will continue next year.
House Prices Look set to increase
It was reported in October 2020, that housing prices rose for to their highest rate in the last 5 years. Nicky Stevenson, managing director at estate agent group Fine and Country recently commented that “No part of the UK economy has flown over the Covid storm like the property market and the picture in September strengthened across the board”.
Prices rose by at least 3% compared with a year earlier in every nation and region of the UK, except Northern Ireland, which recorded a 2.4% increase.
With this steady rise in house prices continuing into next year it is now a more advantageous time than ever to attempt to sell a property on the Housing Market.
Stamp Duty Holiday is ending
As it stands the UK Government’s ‘Stamp Duty Holiday Scheme’ which they introduced in July 2020 will be coming to an end in 2021.
Under this scheme, buyers were not required to pay any stamp duty on the first £500,000 of a property purchase.
Although the UK Government has the discretion to extend this scheme no formal plans have been outlined to do this therefore, as it stands this scheme will expire on 31st March 2021.
It is anticipated that several buyers will still benefit from this scheme before it officially ends next year.
Contact
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If you require assistance on buying or selling property or require advice on any other property matters, please do not hesitate to contact us on 0191 243 8167.
