Activity in the UK housing market picked up at the start of year, leading to a £2,500 jump in asking prices.
The current Coronavirus epidemic is likely to have an adverse effect on many sectors, including the housing industry. Experts are unsure on how badly the virus will affect the housing market, but almost all agree that it will negatively impact the industry.
Before the COVID-19 breakout, however, the UK was seeing a fresh housing boom, according to data from Britain’s biggest property portal, Rightmove. The statistics show that agreed sales had surged by 12% in 2020, compared to the same period in 2019. Rightmove’s website also had a record 152 million visits in January from hopeful buyers.
The data, which was released in February 2020, showed that the cost of property was also increasing rapidly. The average asking price for a home rose to £309,399 in February, which is only £40 short of the all-time record.
Since the beginning of the year, property prices have risen in every part of the country, except the East Midlands. The highest regional monthly and annual increase was recorded in Yorkshire and Humberside, where asking prices were a staggering 5.1% higher than last year.
Rightmove director, Miles Shipside, said:
There is a boom in buyer activity outstripping the rise in the number of new sellers, which we expect to lead to a series of new price records starting next month.
Buyers who had been hesitating and waiting for the greater political certainty following the election outcome may be paying a higher price, but they can now jump into the spring market with renewed confidence.
Many, however, have been quick to point out that Rightmove’s monthly figures are based solely on asking prices, rather than sale prices. This means that, often, the data is less reliable than Land Registry statistics.
What are the reasons for the housing market boom?
Many surveys have suggested that the UK housing market has seen a pick-up following December’s general election. Uncertainty before the election surrounding Brexit may have been putting people off buying. Many housing experts, therefore, predicted that a decisive election result could spark an increase in market activity.
In addition to the increased confidence in UK politics, a RICS survey has suggested that the relatively mild winter weather has made house hunters more active, compared to wetter and colder years.
Whether this increased confidence continues remains to be seen, as Brexit negotiations hit their key deadlines at the end of the year.
Chief economist at RICS, Simon Rubinsohn, welcomed the boom as a “much-needed development”, after new listings had hit a lull in recent years. He stated:
It remains to be seen how long this newfound market momentum is sustained for, and political uncertainty may resurface towards the end of the year.
But, at this point in time, contributors are optimistic regarding the outlook for activity over the next 12 months.
How can Percy Hughes & Roberts help?
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N.B – These figures and quotes are taken from articles dating from February 17th 2020. Percy Hughes & Roberts are following the coronavirus outbreak very carefully and understand this could have a detrimental affect on the UK housing market.