How will Covid-19 impact UK house prices
The government has issued strong guidance advising buyers and sellers to delay their purchases unless the property is vacant or they are contractually bound to continue a sale and both parties can’t reach an agreement to postpone. In effect, the housing market is now frozen.
Rightmove halts house price report for the first time ever
UK’s most used online marketing platform reported that they have to halt their monthly report. Rightmove director and housing market analyst, Miles Shipside said “Given the lockdown and pausing of key activities in the housing market, statistics on the number of properties coming to market, new seller asking prices, and new sales agreed are not meaningful,” “You do not have a functioning market when buyers can’t buy and sellers can’t sell.”
Zoopla forecasts transactions to drop by 80 per cent
Zoopla another popular online platform, said sales volumes are due to plummet. They forecasts a drop in transactions of as much as 80 per cent year-on-year in the individual spring months, and an average fall of 60 per cent across the quarter.
Homebuyers will be concerned by parallels between the current situation and the housing market crash that followed the financial crisis.
The pandemic has hit the property sector hard. In the seven days to 22nd March, buyer demand dropped by 40 per cent compared to the previous week, according to Zoopla. However, sales were still agreed, although this was down 15 per cent on last week, and it was 4 per cent lower than the same week last year.
Any signs of the “Boris Bounce” that injected momentum into the housing market earlier in the year have since decipated as a result of Covid 19.
Market predictions – London House prices forecast to drop over 11% this year as property sales dive and incomes are hit by the coronavirus lockdown
The housing market is expected to fall by up to a sixth as thousands of Britons lose their jobs.
The crash will be driven by the rental sector as the amount tenants can afford to pay plummets due to wage cuts and unemployment.
Yorkshire and East Anglia are expected to be the hardest hit with house prices dropping 16.5 per cent this year.
Next come the North-West and West Midlands with 16 per cent falls. The collapse in prices would take up to £38,000 off the price of an average UK home.
London and Outer Metropolitan are expected to drop by 11.25%.
This creates a huge opportunity for overseas investors to put their investment plans forward and act once the property market activities returns.
Data supplied by RICS
Reasons why Overseas Property Demand Is Up From Hong Kong
Hong Kong middle class buyers find it less affordable to buy property in the city but have high disposable incomes, and see property as a safe haven asset class
Source: Spacious Hong Hong
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