House price growth is close to three-year high!
The housing market is set to have its strongest December for more than a decade, as buyers rush to move home before the stamp duty holiday ends. New sales agreed remain 38 per cent higher than a year ago according to the Zoopla Index.
On 8 July 2020, the Chancellor of the Exchequer announced a temporary stamp duty holiday that cut the rate of stamp duty to zero per cent for all properties £500,000 or under until 31 March 2021.
For example, if you are purchasing a property that is £400,000 as a main residence, before the stamp duty holiday you would have paid £10,000, now you pay £0. For those purchasing over £500,000, for a purchase of £800,000 the stamp duty would previously have been £30,000. This will now be £15,000. So that is a £15,000 saving. This has injected momentum into the market on a scale not seen since before the Brexit referendum.
House price growth is running at 3.5 per cent, the highest level for more than three years, and 2020 is forecast to end with growth of four per cent, Zoopla said.
Richard Donnell, director of research and insight at Zoopla, said: “It has been a roller coaster year for the housing market which is ending on a strong note with demand and sales agreed still more than 30 per cent higher than this time last year.
The latest Bank of England figures show mortgage approvals at their highest level since 2007 while there were more deals in October than any month since 2016.
As we have seen a return of overseas buyers return to the London property market and as the economy recovers, we expect London’s market to return to its longer-term cycle. Since prices have risen by 53% in the city over the last ten years compared with an average of 10% in the north, we expect London to underperform northern regions. House prices in London will rise 1.5% in 2022 and 3% in 2023, putting four-year growth at 5.5%.
It is a great time to invest
The government remains keen to support the housing market as much as possible during COVID-19 restrictions and is actively encouraging lenders to offer favorable terms, to help home buyers and property investors secure their purchases.
As the market continues to boom house prices are going up due to demand, so if you’re considering selling your property, there is an opportunity to get more money out of it than normal, making it an excellent time to cash in on your investment and search for your next home.