‘Content correct at time of publishing and subject to change’
July brought an unexpected 0.5% drop in house prices in the UK, after record highs just the previous month. 2021 has shown that despite this drop, house prices are actually up 30% from the previous market peak in 2007. Although the Nationwide House Price Index shows that the annual house price remained in double figures, 10.5% in July, this is still down from the 17-year high of 13.4% just the month before.
Additionally, the average UK house price has fallen by around £1000 in just a month. This slight fall has, however, been noted as a predictable result due to the great increase in prices over the year so far. This is due to house prices rising by an unsustainable average of 1.6% a month from April-June, which is six times the average monthly gain from the previous 5 years, pre-pandemic.
Changes in moving habits
What’s even more shocking to the housing industry is that house purchases over £500,000 have also increased by 37% according to the Land Registry Data. Although this could be down to the stamp duty holiday, it seems the general consensus is that most of these transactions are from people who would’ve moved regardless of the tax holiday.
A common theme emerging from the pandemic is that people have noticed that life is too short to be living in a home they’re not generally satisfied with. Hence, many people are now on the look for more suitable homes. Therefore, this seems to be the main reasoning as to why the housing market is constantly changing and evolving at such a rapid pace.
First-time buyer trouble
Even though the housing market is full of property that is being sold for more than their asking price, it does beg the question as to whether the fast-paced market could push out first-time buyers. There are now many more deposit-rich home-buyers on the hunt for new homes, which could mean that first-time buyers become bottom of the pile when it comes to choosing a buyer out of a sea of offers.
On the other hand, it isn’t just first-time buyers that may feel excluded in the midst of such a hectic market. Apartment/flat-owners may start to see a lack of interest in their properties due to the coronavirus pandemic leaving most people wanting outdoor space, should they have to spend another moment in lockdown again.
The housing market is currently ever-changing, so it is important to do your research so that you’re not entering the unknown without enough facts. If you need any advice on moving home, do not hesitate to get in touch with us over at Twin Pine Mortgages.