Property Market Update: What’s Been Happening In The UK Property Market June 2021
Phew! It’s been a crazy busy one for us and indeed most agents throughout the UK. The UK property market is continuing to enjoy a boom, with prices still rising in most areas, although with the first stamp duty deadline looming, prices may begin to plateau slightly. Meanwhile though, this has led to record house prices and a skills shortage in the construction industry.
Read on to find out more, with some of June’s key headlines:
Half-Price Homes Scheme Launched
First-time buyers could soon be benefiting from a 30%-50% discount on a home under a new government scheme.
The First Homes initiative is being aimed at local and key workers, including nurses, teachers and supermarket staff, and it will help them to get on the property ladder with a minimum discount of 30% on new homes that are part of the scheme.
The same discount would then be passed on to future buyers in order to keep the homes available to members of the local community at below market rate.
The homes will also be available with just a 5% deposit, as major high street lenders such as Nationwide and Halifax have agreed to offer 95% mortgages on properties purchased under the scheme.
The scheme launched in the Bolsover district of Derbyshire in early June, with further sites to be announced in the coming weeks, and an additional 1500 homes joining the scheme this autumn.
The government has also pledged to add a further 10,000 properties to the scheme every year as part of a major initiative to provide affordable homes to locals.
Click here to find out more about the First Homes scheme.
Average House Prices Reach Record High
The average selling price of a UK home reached a record high of £261,743 in May, and it’s predicted to continue rising according to one of Britain’s biggest mortgage lenders.
The report from Halifax says that the average house price has increased by £22,000 since May 2020 – that’s an annual increase of 9.5%.
This follows similar findings from Nationwide, which reported an increase of 10.9% across the same period.
And with the stamp duty holiday still in place, albeit on a reduced rate, until October, along with the traditionally busy summer period, there could well be further increases to come.
Over 50% Of Homeowners Live In Homes That Fail To Meet Their Needs
A recent survey by property listings website Zoopla has found that more than half of homeowners are stuck in properties which don’t meet their needs.
Most of those quizzed pointed to a lack of space either in the home, or outdoors, while over 25% said they live in an area that they don’t want to be in.
The study of 2,400 homeowners also found that the average person required a home worth an extra £125,000 in order to be suitable for their needs.
It was also revealed that people typically stay in their home for more than four years after realising it’s not right for them.
The coronavirus pandemic has led to many homeowners reassessing where they live, with extra outdoor space and office space being two of the key things people are now looking for from their next home, as they increasingly spend more time living and working in their properties.
Renting Now Cheaper Than Buying
Research by estate agents Hamptons has found that the cost of renting is now cheaper than buying for the first time since December 2014.
Prior to the coronavirus pandemic, buyers with a 10% deposit would be better off than renters by £102 per month.
By last month however, private tenants are better off by an average of £71 per month compared to homeowners.
Only four areas of the UK currently buck the trend – the North East, North West, Yorkshire and Humber, and Scotland.
The trend of higher rents is not expected to continue in the long-term though, with the gap expected to close towards the end of the year before reverting to normal in 2022 when the housing market is forecast to slow down again following an exceptionally busy few months in 2021.
Increased Demand Leads To Construction Industry Boom
Increased demand for home improvements, driven by the pandemic, has led to a boom in the construction industry.
However, a shortage of tradespeople means thousands of extra workers are required, with a report by the Construction Skills Network concluding that an extra 9,250 workers are needed by 2025, just in Wales alone, in order to meet demand.
It’s a similar picture across the UK as a whole, with construction work set to grow by 4.4% on average until the end of 2025.
If you are considering buying or selling, Next Move are your local property experts for the Peterborough area. Call us on 01733 641 642 or email [email protected] to chat with a member of our friendly and experienced team.