Housing prices in April 2020 were still 2.7% higher than the same period last year despite the coronavirus epidemic, new monthly data from Halifax reveals.
However, property values fell 0.6% in April from March, the largest monthly decline in two years, according to the loan giant.
This reflects the current situation of the real estate market which has stalled due to the ongoing pandemic.
Britain’s average property price is now £ 238,511, down from February’s record high of £ 240,461, which means almost £ 2,000 has been written off.
Home prices in April were still 2.7% higher than the same period last year
Real estate prices are expected to continue to decline further in the coming months, until the lockout restrictions are lifted and the market recovers.
One of the main reasons for the decline in activity is due to the social distancing measures currently in place, which means that ownership is almost impossible.
Instead, real estate agents had to settle for online virtual tours, hoping that buyers would still be tempted to make offers.
Russell Galley, chief executive officer of Halifax, said: “It will only be after the relaxation of the lockout restrictions that we will get a sense of the new temporary normal housing conditions.
“Social distancing poses new challenges for home visits and assessments, which will force the industry to adapt to build and maintain consumer confidence.
“More immediately, we are likely to see considerable movement in activity levels, with buyers and sellers seeking to initiate previously agreed transactions that are likely to hang or be delayed. “
Decline: The number of homes available for sale has decreased significantly in the past 11 years
However, house prices rose “unexpectedly” in April despite the coronavirus blockage, according to the latest Nationwide housing report.
The average cost of a home across the country increased 0.7% in the month and increased 3.7% per year, the report said.
He added that at an all-time high of £ 222,915, the average home price was more than £ 3,330 above its level a year ago.
However, it should be noted that the data in the two house price reports is based on mortgage approvals and therefore most will have been requested before foreclosure.
The average cost of a home across the country has increased 3.7% per year, said Nationwide
Some experts also say that due to current circumstances, house price indices are almost worthless.
Jeremy Leaf, a North London real estate agent and former president of RICS ‘residential sector, said, “The lock-in restrictions make these and other housing market studies fairly meaningless.
Housing Price Forecast
Cebr: decrease of 13%
Savills: 5-10% drop in thin sales
Liberum: 7% drop in real prices
Howard Archer of EY: 5% drop
Knight Frank: 5% drop
“It is only when you look behind the numbers that a more interesting picture emerges – in other words, what we see on the ground are previously agreed sales procedures for exchange and completion without renegotiation of prices and an accumulation of shipping interest as buyers and sellers prepare to relax the restrictions.
“Buyers and sellers are also benefiting from interest rates that remain low for the foreseeable future.
“Overall, we are told that transactions are blocked and will be reviewed as soon as it is safe and secure, and in particular surveyors and movers will be able to access the properties.”
Andrew Montlake, general manager of the mortgage broker, Coreco, said, “Given the low transaction levels we are currently seeing, there is no point in publishing house price indexes.
“Although the real estate market has been artificially interrupted, what we do know is that there are many buyers and sellers who want to keep moving forward.
“We have received many more inquiries in the past two weeks, and many are now looking to move to more rural areas once this is done, given the reduced perceived risk of peaks and pandemics future.
Realtors had to do virtual tours online, hoping buyers would always make offers
He adds: “More and more people want to take advantage of the fact that, following this pandemic, there will be more flexibility for homework and better technology. This means that they will have to move less and less to the main cities.
“We are about to radically change our professional and social life and the availability of housing and loans will be the key to this development.
“The importance of the housing market should not be underestimated to boost the economy and it is crucial that the government works closely with industry stakeholders to achieve it. “
Despite some positive outlook from experts, Lloyds Banking Group, which also includes Halifax and Bank of Scotland, revealed in its quarterly results that the baseline scenario predicts that house prices will fall 5% this year.
He said real estate prices would then increase by 2% next year and decrease by 0.7% between 2020 and 2022.
Even his best “upward” forecast scenario, Lloyds, said house prices would drop 2.2% this year.
However, according to Lloyds’ strong downward forecast, he said house prices will all be 10% this year and 30% by 2022.
London could be “isolated” from a slowdown in the housing market, warned real estate expert James Pendleton real estate expert Lucy Pendleton.
She said, “London will be largely isolated because its white-collar workers have been able to continue working from home.
“With the supply of housing in the capital still insufficient, their purchasing power will be the last to begin in the context of a much more sustainable economic downturn, if indeed it occurs.
“This confidence is supported by the resumption of activity and the rise in house prices which were supported by a Boris Bounce in January and February. “
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