Find us on StuRents
  1. Homepage
  2. Uncategorized
  3. UK housing market forecast to remain upbeat.
UK housing market forecast to remain upbeat.

Britain’s pandemic-driven housing boom is likely to cool when tax incentives are withdrawn but changes to the market caused by COVID might keep pressure on demand, a Bank of England policymaker said on Thursday.

House prices rose in the 12 months to March by more than 10% in annual terms – the sharpest increase since August 2007 – spurred by demand for bigger homes as more people work from home, as well as the government’s support measures, data showed.

“One would expect the market to cool down when public support to the economy in general and the housing market in particular is withdrawn over the course of the year, as is currently planned,” Jon Cunliffe, a deputy governor at the BoE, said in a speech to the Law Society.

But there may also be reasons to think that the pandemic might result in more persistent drivers of demand for housing, which means the housing market might not return to its pre-pandemic state, once tax incentives have disappeared, he said.

House prices rose 5.7% across advanced economies during 2020, according to the Federal Reserve Bank of Dallas, the sharpest growth since 2007.

The British housing market was boosted further this March when finance minister Rishi Sunak extended a cut to property purchase taxes that will be phased out over the second half of 2021, and announced a new mortgage guarantee scheme for first-time buyers who cannot afford large deposits.

Cunliffe said past examples of temporary cuts to property purchase taxes – known in Britain as stamp duty holidays – had resulted in a cooling in the housing market upon their expiry.

Related Articles

Social Wall

Stay up to date with our latest posts

Who We Are

Leading Independent
Durham Estate Agents

Subscribe

0845 604 4485

enquiries@eliteestatesandlettings.com

Keep up to date

Error: Contact form not found.