Property price predictions for the rest of 2021
Sun 04 Jul 2021
If you’re thinking about buying or selling a home in the next few months, you will no doubt be wondering what the experts are predicting for the property market as we move into the second half of 2021.
The most recent reports on the UK housing market show prices are continuing to grow at record rates. The Nationwide puts the annual increase in prices to June at 13.4%, a seventeen year high. The boom in house prices was kick-started by the introduction last July of a Stamp Duty holiday on the first £500,000 of a property’s value, offering savings of up to £15,000.
Industry experts predict that the end of the scheme on 1st October could bring about a slowdown in the rate of house price increases as people bring forward their moving plans to beat the deadline. The end of the furlough scheme in September is also predicted to have an effect on the property market as more people face the prospect of unemployment or a reduction in hours.
However, it is not just the Stamp Duty incentive that has been driving the housing market. There are other important factors in play.
Many people have been reassessing where they want to live over the past 18 months with greater value being put on access to more space, both indoor and out, even if that means living further away from our workplaces. Estate agents report that the “race for space” is still very much fuelling demand.
The mortgage guarantee scheme, introduced by the government back in March, means that many first-time buyers are also able to enter the market now that they have access to 95% mortgages.
All this means that it’s unlikely that the current excess of demand over supply is going to change any time soon and, as a result, prices are expected to continue to grow through the rest of 2021. However, most analysts believe the rate of annual price growth will slow to around 4%.
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