Hamptons International released its Housing Market Forecasts report on 28 September. Below is a year-by-year summary of the key forecasts.
2020 - House prices set to rise 2.0 % across Great Britain, despite impact of Covid-19
After a promising start to the year, the onset of Covid-19 resulted in the housing market coming to an abrupt halt. But following its reopening in May, the strength of the market’s recovery surpassed expectations. By early June, there were more people looking to move home than at the same time last year. And following the July announcement of a nine-month stamp duty holiday, buyer numbers were up by double digit percentages in every region, with the largest increases in London and the South.
The market has been buoyed by pent-up demand that not only grew as a result of lockdown, but could be traced back to Brexit uncertainty and the EU referendum in 2016. Movers in the market today have put lifestyle above economic uncertainty. Many of these are households who have built up equity in their homes, are less likely to have lost their job and have the security of a financial buffer.
The latest data for September shows that the housing market has remained buoyant, with the average home selling for 99% of its initial asking price – a record high. And it’s these late summer sales that will form Q4 completions, which Hamptons’ house price forecasts are based on. The firm stated: “We expect house prices in Great Britain to rise 2.0% in 2020, up from 0.9% in 2019. Wales (3.0%) followed by London (2.5%), Yorkshire & the Humber (2.5%) and the North West (2.5%) will see the strongest house price growth in 2020.”
2021 - The economy will disrupt the housing market next year, but prices should stabilise
2021 will be challenging, with lots of uncertainties and economic deadlines ahead. Although the wind down of government support measures means that unemployment is likely to peak in H1 2021, the economy should have made up some lost ground, according to Hamptons, which also assumes that a trade deal will be agreed with the EU at the turn of the year and a vaccine becomes available in the first half of 2021.
