The UK property market continues to show its resilience, with the latest Rightmove house price report indicating that a record level of demand has boosted property prices by almost £2,500 in one month.
Almost £2,500 property value boost in one month
Demand for UK property has hit an all-time high according to portal Rightmove, with demand outstripping supply at its highest rate in 10 years.
With the number of buyer enquiries up by 34% when compared to the previous year, the value of properties coming to the market has increased, on average, by 0.8% (+£2,484) in March alone.
Commenting on the report, Tim Bannister, Rightmove’s Director of Property Data said: “Concerns of a cliff edge for the housing market at the end of March have dissipated, partly due to the tax deadline extensions in all of the UK bar Scotland, but also because the already high level of buyer demand caused by the lockdowns has continued to surge since the start of the year.
“This demand will be further boosted from April by the new Government guarantees enabling lenders to bring back 5% deposit mortgages. Whilst it is unfortunately not the perfect time to buy for some people who have been adversely affected by the pandemic, the record buyer demand measured by Rightmove indicates that now is the right time for many.
“Record low interest rates and the new focus on what your home needs to offer after several lockdowns have led us to the greatest excess of demand over supply in the last ten years,” Bannister added. View Rightmove report…
Values boosted by Stamp Duty holiday extension
Chancellor Rishi Sunak announced a 3-month extension to the popular Stamp Duty holiday in the March 2021 Budget.
Homebuyers and property investors now have more time to benefit from the tax break that the Stamp Duty reduction provides. On residential properties, the extended Stamp Duty Land Tax threshold applies to properties under £500,000 until 30th June 2021.
After the deadline, some buyers will also benefit from an additional Stamp Duty holiday extension applied to residential properties under £250,000 from 1st July until 30th September.
The Chancellor used the 2021 Budget to announce the introduction of a 95% mortgage guarantee scheme. Additional information will be issued in April however, those who want to take advantage of the scheme should note that it is only available on properties under £600,000. Independent advice should always be sought when purchasing a property with a mortgage.
2021 outlook for UK property prices
The government’s extension to the Stamp Duty holiday deadline, record low-interest rates, and mortgage guarantees for first-time buyers are likely to indicate a sharp rise in property values throughout 2021.
Commenting on the outlook for the rest of the year, Bannister added: “The current annual rate of house price increase stands at a historically modest rate of 2.7 %, but we stand by our forecast for the year of 4% which we published in December.”
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