Covid-19 update

HM Land Registry latest price data


HM Land Registry published the latest price data on 26th March 2021 which can now be viewed on The Move Market.

We are now getting much more data that is related to transactions that have been agreed since the Coronavirus outbreak - one surprising thing that not many predicted was pent up demand causing a mini-boom in property prices and housing activity rising above normal levels.

This in part can be explained by many people 'needing' to move given they need more space to work from home that they had not previously anticipated.

In addition to the need to move being more urgent for many people, the Chancellor's annoucement of the stamp duty holiday has also boosted housing activity by quite a lot. Originally the stamp duty holiday was due to end at the end on March 31, 2021 but it now looks likely that it will be extended in the budget - to last for another three months.

We foresee a split in property values between smaller flats and larger properties - we expect smaller homes (especially flats) to lose more value than homes that can accomodate a home office.

It is still important to note that the negative impact of Coronavirus is yet to be fully understood with regard to its impact on property prices.

We expect a market price correction (falling prices) to more prominently show throughout 2021 as demand eases and the job market shrinks with many companies reducing headcount/jobs.

Over the next year we expect prices to fall by at least 5% - although we see potential for further downward pressure and prices may fall even further.

Valuations


The impact of Coronavirus is widespread and is affecting not just the health and well being of people but businesses profitability, jobs and house prices.

The full impact is yet to be seen but one thing that is certain is that people will have less money and lower job security over the next 12 months.

How negatively this affects the property market and prices that buyers are prepared to pay will start to appear shortly.

Generally, in economic slumps, house prices fall - this hasn't happened just yet though for a few reasons:

  • Property prices are typically published with a 2 month delay (i.e. say a person completes their sale and moves in January, the sale data will only be published by HM Land Registry in March).
  • Some property sales that completed in April and May, will have exchanged earlier in the year before the real impact of Covid-19 was known and so won't fully reflect the change in prices because of the virus.
  • Pent-up demand from people needing to move home urgently has caused an unexpected lift in property prices in some parts of the country.

What does all this mean?


The fall in prices hasn't happened yet in lots of places but is still expected to hit and when it does it could cause severe price falls.

Check back here regularly as we will update our valuations as soon as HM Land Registry publish more data.

Making an offer


Given the current economic uncertainty, property prices are likely to be weaker for some time, with more downward pressure up until the end of the year.

This doesn't necessarily make it a bad time to buy though. As long as you do your research and put in a good offer, you could end up profiting nicely once the virus passes and normality returns.