Thursday, October 21, 2021
Real EstateUK

U.K. housing market ended strong in 2020 despite pandemic

U.K. housing market

According to the house-price index from the Land Registry, home prices jumped 8.5% year-over-year (YOY) in December

The U.K. housing market ended strong in 2020, despite a year ravaged by the pandemic and subsequent economic shutdowns.

Home prices jumped 8.5% year-over-year (YOY) in December, according to the house-price index from the government’s Land Registry, released Wednesday.

The average price increased 1.2% in December, compared with the previous month, bringing the average price of a property to £251,500, the data showed. At the same time in 2019 the monthly rise between November and December was just 0.1%.

In contrast to the usual seasonal slowdown toward the end of the year, we were still seeing a very active sales market [at the end of 2020], Nick Barnes, head of research at the estate agency Chestertons, said in response to the new government figures. Buyer demand continued to be fuelled by the stamp duty holiday and the desire to move to a larger property that provides a dedicated area for home working.

The report found that North West England saw the strongest price growth, where YOY price increased 11.2% to £183,727 in December.

The lowest annual growth was seen in London, where the average home costs £496,066, with prices rising by 3.5% in December 2020, according to the index. That’s significantly lower than the 7% year-over-year growth in November 2020.

Home prices in Wales rose to £184,195 in December, a 10.7% rise compared with the same time the previous year, the index showed. The average home price in Scotland’s reached £162,983 in December, a rise of 8.4% compared with December 2019.

Going forward, some are wondering if this growth is sustainable after government benefits come to an end and people look for work. Moreover, the stamp duty holiday is set to expire at the end of March, although it could be extended an additional six weeks.

The question is can this rate of growth be sustained as furlough drops off and unemployment rises, Matthew Cooper, founder and managing director of Yes Homebuyers, said in a statement. The property market is surely set to become less certain over the coming months and this will no doubt be reflected in both market activity levels and price growth.

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