Unexpected house price growth predicted across Hertfordshire
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The unexpected post-lockdown property boom has left Savills reassessing their house price predictions, with growth of 17.3 per cent now expected in the East of England over the next five years.
UK-wide, the property firm is predicting growth of 20.4 per cent in the period to 2024 and a 4 per cent rise this year – suggesting the current recession is no barrier to a property boom.
Lucian Cook, Savills’ head of residential research, said: “The pace of change in the UK housing market has taken us all by surprise over the past few months suggesting normal rules simply don’t apply.”
Their previous forecasts, which were issued five weeks after the housing market began to reopen following lockdown, saw falls averaging -7.5 per cent predicted UK-wide for 2020, with growth of 15.1 per cent expected by 2024.
The firm believes that continued low interest rates will help underpin five-year growth, despite an anticipated dip in momentum next year following the end of the stamp duty holiday and the government furlough scheme.
Nick Ingle, who leads the residential team at Savills Harpenden, said: “While we clearly can’t ignore the economic backdrop, other factors have unleashed an unexpected wave of activity in the market.
“Many people are reassessing their work-life balance, seeking a change of location or a trade up the housing ladder.
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“The unexpected stamp duty holiday has also given a further boost to the market, particularly in higher value locations through the commuter zone and lifestyle relocation hotspots.
He added: “Looking ahead, the pace of economic recovery and the government’s policy response, together with the progression of COVID-19 and the search for a vaccine, mean the outlook for the housing market will inevitably continue to change.
“Conditions are likely to favour those with equity, creating a market for mortgaged home movers and cash buyers, but we are also expecting ultra-low interest rates to continue – providing more capacity for house price growth over the medium term, tempered by the impact on loan to income ratios and mortgage deposit requirements.”