What's in store for the Harpenden and St Albans property markets in 2021?
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The year ahead is looking promising for the local property market, says one Harpenden agent – but there are some causes for concern.
Nick Ingle, who leads the residential team at Savills in Harpenden, said he expects the new lockdown to “make people more aware of the limitations of their existing home and increase their commitment to moving, likely leading to pent-up demand as seen after the first national lockdown early in 2020.
“At the same time, however, the pool of those able to act on their desire to move will shrink.”
There’s certainly no shortage of enthusiasm among movers: Rightmove has recorded its busiest start to a new year ever, with a 30 per cent increase in visits at the start of January compared to the same period a year ago.
After a rocky start, 2020 ended on a high, with Nationwide reporting annual house price growth of 7.3 per cent, while the Bank of England recorded a 58 per cent increase in mortgage approvals.
Nick expects lenders to become more risk averse in 2021, however, which will make it harder for movers needing high levels of borrowing to proceed with their desired purchase.
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And while the rush to beat the stamp duty deadline will help sustain activity in the first quarter of 2021, this won’t last: the tax break ends on March 31, and the furlough scheme will draw to a close a month later, with increased unemployment a likely consequence.
This “may mean a deeper lull in activity mid-year but a stronger bounce back as the vaccine rollout progresses,” Nick said.
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He added: “Our researchers also expect COVID-19 to have a longer tail in the form of higher taxation. This will likely act as a medium term drag on the market, though low interest rates will help counter this.”