After a turbulent year for house prices, what can we expect in the upcoming months?
For the past year the house prices have been ever increasing, but is this set to continue?
There have been many factors behind the boom, ranging from stamp duty exemption to the demand or more people working from home and requiring more space. But what does this mean as we move closer to ‘normal’.
Whilst new comers to the housing market may have their fingers crossed for a crash in prices, that is unlikely to be the case for the next coming months. Chances are that despite growth set to continue we are likely to see the market settle and slow in any price increases. This is due to a number of factors.
End of Stamp Duty Holiday
The stamp duty holiday led to a surge in properties being brought in 2020 and 2021. Come October 2021 the Stamp Duty Scheme will come to an end.
According to Nationwide Building Society July 2021 recorded the first dip of 0.5% in the housing market which is largely because of the end of the stamp duty scheme
So, what do we think will happen come the end of the stamp duty holiday? Although it would mean a return of normal taxing, we suspect that the housing market will continue to thrive however, we may see a dip in housing sales in rural areas. Reason being is that during the last two years we have seen more people buying second homes to make the use out of the scheme, with this incentive no longer in place, fewer people will be investing in second homes. Aside from this, the need for homes is ever increasing and more people relocating to more coastal areas means prices could stay high.
With the furlough scheme coming to an end in October we could see a rise in properties available to the market place as more people lose their jobs and can no longer afford mortgages. If the interest rates also increase as they have been sitting at record lows to could make mortgages more expensive too. These factors together could slow the demand for sale properties as more and more people look to let, thus lowering house prices.
From both of these factors we can see that house prices are likely to remain strong but will slow. We won’t be seeing big jumps in property prices like we already have, however we are also unlike to see drops in house prices.
Are you looking to sell your property? Call Direct Moves, Weymouth for a free valuation on 01305 778500.