The coronavirus pandemic made for a difficult 2020 for many and it looks set to impact much of 2021 too. As the vaccine rollout continues, the virus remains a threat to health and a source of uncertainty for the economy. The latter will be further complicated by Brexit this year.
The effect of the pandemic on the property market was difficult to predict last year, with a freeze on the market followed by a mini-boom.
If you’re looking to move this year, what will the market look like? Have we already seen an end to the mini-boom? And will restrictions allow you to move at all?
2020 was a challenging year for the property market
When the UK first entered coronavirus lockdown in March, the market was all but frozen and experts predicted a sharp fall in prices would follow.
When lockdown ended in July the sector experienced a mini-boom. The Guardian reported last year that average house prices were up by around £13,000 for the year and that June to November saw ‘the fastest five-month gain since 2004.’
The increase can be partly explained by pent-up demand and the Chancellor’s Stamp Duty holiday, due to end in March.
But the coronavirus pandemic also led to many re-evaluating what they wanted from their homes, opting to move to somewhere that fitted their new ideal. Open-plan spaces that allowed no peace for homeworking were out, and countryside locations with big gardens and outdoor offices became desirable.
While economic uncertainty is set to remain as long as the pandemic is with us, vaccine rollouts offer hope for homeowners in 2021.
Expert predictions for 2021 vary wildly
The mini-boom in the property market was still going strong towards the end of 2020, and while the first lockdown froze the sector completely, it showed far more resilience the second time around.
2021 begins with the country once again in lockdown but the market remains open.
The continued threat of large-scale unemployment and the end of the Stamp Duty holiday in March spells more uncertainty and that has led to difficulties in predicting exactly what the year will bring.
Many experts predict a fall in property prices this year. The end of the Stamp Duty holiday could also see sales fall through if they can’t be completed in time, and the Stamp Duty reinstatement makes continuing with the purchase impossible.
Halifax, the UK’s biggest lender, predicts a fall of between 2% and 5% according to a Guardian report. The Office for Budget Responsibility predicts an even greater fall for 2021, suggesting an 8% drop.
At the other end of the scale, property website Rightmove is predicting prices will rise in 2021, by as much as 4%.
The rollout of the coronavirus vaccine is expected to lead to a return to ‘normal’ life later in the year and forecasts are optimistic for 2022.
You can still move to a new home during lockdown
If you are due to move to a new home in the next month or so, you are still able to under current lockdown restrictions.
The government website confirms that people looking to continue with a planned move or view properties for a future move are permitted to do so.
Estate agents, removals firms, and valuers are open this time around, though you may find the process of moving different at the moment. Remember to adhere to social distancing guidelines at all times and be prepared for a change to normal processes to minimise the risk of spreading the virus.
When viewing a property, conducting a viewing, or visiting the office of letting agents, for example, remember to follow guidelines on face coverings and wear a mask unless medically exempt. Be sure to wash your hands regularly too.
You might be offered a virtual viewing in the instance. You should also be prepared for delays to a house move if you or any other party has to self-isolate.
Get in touch
Whether you’re a first-time buyer or a second-stepper, if you’re are looking to move to a new home this year you’ll have plenty to think about.
For many, the pandemic has shifted priorities. You might have permanently shifted to remote working and be looking for a property with a home office. Maybe lockdown has made you value open space, and you want a bigger garden or a more rural location?
Whatever the reason for moving, you’ll need to think carefully. Read Your guide to the cost of moving to a new house and then speak to us.
We can help you decide how moving to a new home fits into your current financial plan. Please email hello@fingerprintfp.co.uk or call 03452 100 100.
