UK house prices rose at the fastest monthly rate in almost three years before the coronavirus paralyzed the housing market, according to new figures.
With the coronavirus now causing unprecedented economic disruption and many real estate agents struggling to stay afloat, several industry insiders have said the house price data is now “irrelevant”.
Nationwide data on Thursday showed that the average mortgage supply jumped 0.8% between February and March to nearly £ 220,000. This is the fastest monthly increase since June 2017.
government foreclosure and warning of house moves to contain COVID-19, real estate agents have since said activity has dropped. “Data-reactid =” 26 “> But most of the period covered by the figures was before the British government was locked and the move to contain COVID-19 was warned, as estate agents reported activity has since dropped.
resumption of activity observed since December elections. “data-reactid =” 27 “> Nationwide chief economist Robert Gardner said the market was now” stopping “, sharply putting end of the resumption of activity observed since the December elections.
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Zoopla has predicted a 60% drop in transactions in the coming months, even buyers and sellers who have already traded are urged to delay completion.
Experts are divided on the likely impact on prices. Economic shocks often drive prices down, but some predict they will barely budge as many homeowners stay put, with mortgage vacancies and government wage support limiting the number of forced moves.
“Even talking about bricks and mortar in today’s climate seems preposterous,” said Jonathan Samuels, CEO of mortgage lender Octane Capital.
Marc von Grundherr, director of real estate agent Benham and Reeves, said prices could drop, but his biggest concern was whether Britain would have “agents left” to sell houses while they are fighting to survive.
“Housing prices have become irrelevant. This is something no agent would ever expect to say, “said Lucy Pendleton, director of real estate agent James Pendleton.
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“Even before a brutal housing market freeze was declared, we were forced to hire more than half of our staff.”
Pendleton said the growing crisis had “torn staff and customers from our hands”. The London-based real estate agent saw his agreed sales fall 84% last week a year earlier, with offers down 70% and views ceasing completely.
Jeremy Leaf, a North London real estate agent and former residential president of the Royal Institute of Chartered Surveyors (RICS), agreed that the latest data was now “academic”.
He said he saw travel, hospitality and entertainment workers forced to withdraw from transactions.
However, the market may not collapse completely. Leaf said the majority of his company’s trade still took place last week.
Many lenders remain keen to lend despite tightening loan-to-value ratios.
Mark Harris, managing director of mortgage broker SPF Private Clients, said that demands for re-mortgages have increased. Homeowners “sitting at home with free time” came into contact amid increased economic uncertainty and drops in the Bank of England’s emergency rates.