Even with the stamp duty holiday deadline nearing, the UK property market is remaining busy as home-hunters look for their next home.
Rightmove has just seen its busiest January on record. The property portal received more than 211 million visits. And the amount home-hunters spent on the site equated to 1.6bn minutes. This is a 44% increase compared to January 2020.
The busiest day of the month was Saturday 30 January. On that day alone, home-hunters spent more than 60 million minutes looking for their next move. There are even signs that new buyers are just now starting their search. In January, there were 7% more buyers contacting estate agents through Rightmove than in the same month the previous year.
Rightmove’s resident property data expert Tim Bannister states: “It’s clear that more people than ever before used the new year as a chance to start thinking about moving home, despite all of the challenges and worries that came with January, but we are seeing the effect of lockdown on the number of properties coming to market.”
Supply isn’t keeping up with demand
The number of new properties coming to the market is 21% fewer than January last year. The lockdown restrictions in place are causing sellers to be more reluctant to list their properties, leading to an imbalance in supply and demand.
With supply not keeping up with demand, this is putting upwards pressure on house price growth. However, more properties will likely come to the market once restrictions start to be lifted. And with the stamp duty holiday deadline nearing, there could be an increase in property transactions falling through.
Tim Bannister comments: “We’re starting to see fall throughs creep up a bit, though not by a substantial amount, a sign that some deals may be falling apart as they know they won’t complete in time to make the stamp duty holiday deadline, though this is likely to be in the groups set to make more substantial savings.”
“The start of February so far looks encouraging for activity, which points to some positive signs for the next few months and into Q2.”
The north of England in particular is expected to see strong demand and house price growth in the coming months. Regional towns and cities in the north are home to lower property prices, allowing homebuyers and investors to get more for their money.
Rental demand remains strong
In the second half of 2020, activity in the rental market surged. And that has continued into 2021. According to Rightmove, there are 14% more renters looking for their next rental property than last year at this time. However, new listings are down by 14% as supply also isn’t keeping up with demand in the rental sector.
Recent data from Zoopla has also shown that houses are letting 30% quicker than a year ago, shortening void periods for landlords. Average UK rents also increased by 1.4% in the three months to the end of December. And demand is particularly high for larger properties.
Change in property priorities
One of the biggest trends seen since the beginning of the COVID-19 pandemic has been a shift among buyers and tenants for larger properties and access to outside space. Additionally, as more people are working from home, many are looking for office space and high-speed broadband.
Many people living in smaller properties are still looking to move to greener locations with more space. This could keep the UK property market moving even after the stamp duty holiday comes to an end.