There had been an expected cool off in the housing market due to the stamp duty holiday deadline that ended the discount savings at the close of September. The tax holiday had been installed at the beginning of the pandemic to help motivate buyers and keep the housing market active. It worked. Many believe it was the push start that helped bring buyers into the market despite the pandemic, lockdowns, and restrictions.

The stamp duty holiday was due to end in March, but it was extended to the end of June. The deadline in June reduced the savings that would remain until the end of September. Leading up to the final deadline there was a rush to buy and complete the purchases to realize the savings. Afterwards there was a quiet in the market that marked the lowest gains for an October in years.

November would either reveal a continued cooling off resulting in an outlook that the market was slowing down naturally or it would reveal a rally showing that those that strongly desired the discount had taken action, but that even without the tax holiday buyers would be motivated.

November data released by Nationwide revealed double digit gains over November 2020 of 10% bringing the average house price to £252,687. 

The continued demand in the housing market is coming as a surprise to many experts as house prices continue to climb and push many out of the market, especially first time buyers. According to chief economist with Nationwide Robert Gardner, prices are now close to 15% higher than when the global pandemic took hold in March of last year in the UK.

Mr. Gardner remarked, “Activity has been extremely buoyant in 2021. Early indications also suggest that labour market conditions remain robust, despite the furlough scheme finishing at the end of September.

“If this is maintained, housing market conditions may remain fairly buoyant in the coming months, especially since the market has momentum and there is scope for ongoing shifts in housing preferences, as a result of the pandemic, to continue to support activity.”

Mr. Gardner added that there is some uncertainty in the market due to the newly identified Omicron variant of Covid-19 and how it could impact buyer demand and sellers. There is already a lack of available properties to choose from making asking prices acceptable to buyers despite the increases.

With continued low interest rates available from lenders and the pandemic still actively impacting consumers, the demand in the market could remain strong going into the next year. Low interest rate remortgages could keep homeowners staying put rather than moving due to the ability to substantially save money as well as turn their built up equity into cash and that could further limit starter homes coming onto the market for first time buyers. 

One thing many trend watchers in the housing market are certain of is that the demand for country living with more spacious indoors and outdoors available to buyers will remain strong over the desire for tight and highly populated city living.