Factors that impact the UK property market in 2021
2021 has been a year of uncertainty, and the situation of the property market in the UK was no different. When Covid-19 struck in 2020, the real estate market across the world suffered, and so did the UK property market. Following this government rolled out many government schemes that boost the real estate market and the economy. But no one could predict the future of the UK property market. Some of the important factors that impact the UK property market in 2021 are discussed below.
Stamp duty holiday
Stamp duty holiday was introduced in July 2020 after the first lockdown in the UK. The stamp duty holiday temporarily suspended the stamp duty that a person has to pay while buying a property. The government introduced the scheme to revive the UK property market and boost the confidence of the buyer. Stamp duty holiday reduced a considerable amount of money while buying a property which encouraged more people to come forward to use the scheme and save money. Since the stamp duty holiday was a success, it has been extended till September 2021. So, if you’ve thought about getting a property in Wolverhampton, now is the right time to get in touch with estate agents in Wolverhampton to find the best property for you.
Covid-19 increased the work-from-home culture, and families started working from home. Each needed a private spot to work in, and it increased the demand for properties with large spaces. Initially, buyers preferred buying properties close to the city to be able to commute to work every day easily. As the scenarios have changed, all potential buyers are working from home. Buyers are looking at properties in the boroughs and suburbs that are much bigger and cheaper than properties in the city. People started moving from cities to the outskirts, which got them thinking, “how much is my property worth”. The best way to know the value of your property is through property valuation. If you want to buy a home in Wolverhampton, get in touch with agents for property valuation Wolverhampton.
As per buyer demand, there is an increased demand for properties with a spare bedroom that can be converted to a home office. Hence, people are looking for large properties with outdoor space, spare bedrooms, and a large garage space to accommodate their current lifestyle.
Mortgage guarantee scheme
Before the pandemic, it was easy to secure low-deposit mortgages. However, due to uncertainties and increased unemployment, banks and lenders made their criteria very stringent for mortgages, and the low deposit mortgages were hard to come by. Following that, the UK government established a mortgage guarantee scheme that helped buyers and investors secure a mortgage with 5 percent of the deposit. This announcement is expected to bring a boom in the property market. The scheme has increased the demand for homes and is touted to be the game-changer in the UK housing market.
Average price of the property
The price of a property is determined by the demand and supply in the real estate market. Availability of mortgages and the rate of interest also determine the sale of a property. Due to Covid-19, banks and lenders became very stringent about their lending criteria, affecting the housing market. With the criteria becoming stricter, the mortgages were low, and it affected the interest rates.
Apart from this, inflation and unemployment are also major determining factors that decide the average price of a property. There are also other factors like political uncertainty that Brexit brought in. Brexit hit the real estate sector hard and played a big role in the average price of the property.
These determining factors and more are expected to shape the UK property market in 2021