As the UK continues to ease out of lockdown, an ideal set of factors have blended together to help property sellers, including a post-pandemic surge in demand and the recently announced stamp duty holiday.
Buyers are also benefitting from record-low interest rates and are keen to move during the summer while the weather remains favourable.
As such, now could be a good time for sellers to put their home on the market to achieve a fast sale for the best possible asking price.
Since the reopening of the property market in mid-May, all findings have pointed to a resilient market as buyers are eagerly searching for their next home and sellers are keen to take advantage of this rise in demand.
People have had a lot of time to think during lockdown, and in many cases that included thoughts of moving to a bigger home with outdoor space, or a switch from the city to the country now that remote working has made central living or commuting less of a priority. According to Rightmove’s House Price Index, Britain’s housing market has enjoyed a post-lockdown mini-boom, propelled by the recent stamp duty cut, which has pushed asking prices to a record high.
The latest figures from the portal showed that the average price of a property coming to the market reached £320,265 in July, the highest figure since the site first launched its report in 2001. The figure was up 2.4% (just over £7,000) on the previous record of £312,625 recorded in March, just before the housing market was frozen due to Covid-19.
In the West Midlands, average asking prices reached £243,260, up 6.3% on the previous year, while the East Midlands has an average asking price of £241,749 – a rise of 1.4% since July and 6.3% year-on-year.
The aforementioned stamp duty holiday – which means buyers of all main homes worth up to £500,000 in England and Northern Ireland are exempt from paying the tax until March 31 2021 – has amplified what was already strong demand.
Rightmove said the change, announced by Chancellor Rishi Sunak in his summer economic update on July 8, had an immediate effect, with the number of home sales agreed between July 8 and July 12 increasing by 35% on the same period a year ago.
As the stamp duty holiday is time-sensitive, second, third and fourth-steppers, downsizers and buy-to-let landlords will be keen to act before the holiday ends on March 31 next year – meaning increased competition for UK property.
Even some first-time buyers of more expensive homes, who weren’t covered by the exemption of stamp duty for first-timers purchasing homes under £300,000, will now in all likelihood pay no stamp duty if they buy during this period.
So, while the release of pent-up demand has given the housing market its initial boost, the stamp duty holiday is set to sustain that momentum and aid the sector’s long-term recovery. However, there are concerns about a late surge before the holiday ends next year, which could leave lenders, conveyancers, brokers and surveyors unable to cope with the volume of demand.
Alongside the stamp duty holiday and various other initiatives that are encouraging buyers, purchasers are also enjoying record-low interest rates.
To safeguard the economy against the coronavirus, the Bank of England slashed its base rate from 0.75% to 0.25% in March 2020. Just a week later, the Bank’s Monetary Policy Committee, which decides on any base rate changes, cut it further to 0.1% – the lowest ever rate in the Bank’s 325-year history.
Of course, when interest rates are very low, borrowing conditions are improved, and so the change has been a major benefit to buyers seeking to secure a mortgage on favourable terms. As a result, the mortgage market has become very competitive.
While the number of 95% and 90% mortgages have fallen dramatically since the pandemic emerged, as lenders steered clear of riskier deals, there are signs that these are starting to recover. The recent extension to the Help to Buy scheme by two months will further encourage buyers who can no longer access higher loan-to-value mortgages.
For sellers, the above reasons, along with summer generally being the period where your home looks its absolute best, makes now a very good time to sell. By providing a clean and attractive home, setting the right asking price, and working with an experienced local agent, you can achieve a quick and easy sale.
Here at Centrick, we are working alongside the government guidelines to ensure a safe and seamless process for sellers across the Midlands. For more information on our services, please contact us today.
Additionally, to find out how much your home could be worth on the current market, check out our instant valuation tool.
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