The pandemic took a toll on the economy and that was of course expected. No one thought that lockdowns would find the economy booming. Yet, one sector of the economy did boom, and it was not expected. The housing market, which had already proved to be resilient during the turmoil of Brexit, again emerged as a surprise entry on the economic spreadsheet. The pandemic actually created a sort of perfect storm. 

More so for homeowners than home buyers, yet some benefitted, at least those that took a leap of faith and risk and bought early on.

A desire for more space pushed a demand for housing. It was nicknamed the race for space as people sought to find a dwelling better suited to their needs during a pandemic that required lockdowns. There was a strong desire for private space to work from home, more area for children to study, space for exercising and getting fit, and the top choice for many was a garden that allowed one to enjoy the outdoors with their children and pets.

Demand grew and did not waiver, not even when the process to shop and obtain a mortgage changed and slowed down due to restrictions. If not for the ability to shop online and view properties through live streaming with an agent, the outcome for the housing market would surely have been different.

Interest rates helped fuel buying. The Bank of England lowered the standard base interest rate to a 300 year historic low. Lenders began to offer their lowest ever interest rate deals. Borrowing was cheap and it meant buyers could get more for their expense. More area, more space, more upgrades, and more savings due to the government help of offering a property tax discount with the stamp duty holiday.

There were more people buying, even homeowners were moving home, but fewer properties were coming onto the market. Prices began to increase as the demand grew and supply dwindled. 

The average house price grew month after month and now cheap borrowing mattered little if you could not find a house you could afford despite the stamp duty holiday and lower interest rates. Asking prices grew and if a home buyer wanted a home they were going to have to borrow more or pull more from savings. Many turned to the bank of mum and dad to help fund their purchases when they fell short with what lenders would allow.

Homeowners that stayed put were offered low interest rates on remortgages. According to a recent report, the average homeowner that remortgaged to a lower rate saved over £400 per month. Some homeowners turned built up equity into cash and used the cash to upgrade and improve their current home rather than search out a different one for their pandemic lifestyle.

Many of those improvements increased the value of the home. 

Homeowners were able to live in an improved home with lower repayments and watch their property increase in value with their lower rate remortgage deals. With a fixed rate remortgage they had secured their savings for years to come.

Month after month as house prices increased, property values did as well. The unexpected need and switch in desire to leave behind the city and embrace the country lifestyle saw strong boosts in home values in areas that had been ignored for decades. 

Low interest remortgages and increased property values have been unexpected positives for homeowners due to the pandemic. Experts have forecasted a continued interest in the housing market, but perhaps a slowdown as more buyers are shut out. 

Those homeowners that stayed put and are ready for a remortgage due to their current mortgage deal ending or having already ended should not pass up the opportunity to shop for a savings. They could be substantial and they could put cash in hand if so desired. While the cash could be used for anything the homeowner desires, investing back into the property with improvements and upgrades could make their home sweet home the dream home so many others are searching for and can’t find or perhaps afford.