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 is the housing market. It also looks set to continue to grow next year.
There are several reasons why the Housing Market has seen an upturn this year. For example, many people have re-evaluated their housing needs because of the recent lockdown restrictions.
Many people may have decided they need a bigger home. This could be to ensure they have adequate space so that they can work from home. Or, other people who previously did not have any outdoor space have recognised the importance of having a house with a garden.
Rettie & Co. recently reported that “demand is strongest for quality family homes, and larger apartments with outdoor space, as households re-evaluate aspirations and requirements.” This came from their Newcastle Housing Sales Market Review Report for Winter 2019/2020.
As a challenging 2020 ends, we list some features expected to influence the performance of the Housing Market in 2021:
Demand looks set to continue
Although a vaccination for Coronavirus is available across the UK, people will continue working from home whilst social distancing restrictions remain.
This could lead to 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 as the UK Government’s furlough scheme ends in March 2021.
It remains to be seen if there will be more people upsizing than downsizing. However, one thing remains clear: 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. Northern Ireland was an exception, recording a 2.4% increase.
A steady rise in house prices will continue into next year. This means it is an advantageous time to sell a property on the Housing Market.
Stamp Duty Holiday is ending
As it stands the UK Government’s ‘Stamp Duty Holiday Scheme’, introduced in July 2020, will be ending in 2021.
Under this scheme, buyers did not pay any stamp duty on the first £500,000 of a property purchase.
Although the UK Government can extend this scheme, no formal plans have been outlined to do this. Therefore, this scheme will expire on 31st March 2021.
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, contact us on 0191 243 8167.
