- 2021’s market is on track to record the highest level of sales (1.5m) since 2007
- Combined market activity is set to amount to £473bn in transaction value in 2021
- headwinds forecast for 2021, coming from higher living costs and increased mortgage rates
The property group Zoopla has forecast UK housing activity will have a record year after a enhanced period of activity driven by restrictions and stimulus brought about the coronavirus pandemic.
“2021 is set to be a record year for the housing market with the most moves by homeowners since 2007 and nearly £500bn of home sales,” said Richard Donnell, Zoopla.
Zoopla has predicted there will be £473bn in transaction value this year.
Factors such as the reduced supply of housing has increased house prices in a period buyers scrambled to take advantage of government schemes such as the reduction of stamp duty.
“The impact of the pandemic on the housing market has further to run but at a less frenetic pace. We expect the momentum in the market to outweigh some emerging headwinds from higher living costs and the risk of higher mortgage rates,” Donnell continued.
Zoopla’s research also revealed how buyers in different parts of the market had reacted a the pandemic progressed. Wealthier buyers were more active towards the beginning of the pandemic whilst first time buyers began to come back into the market in 2021.
Despite resilience being maintained in the housing market through 2021, Zoopla sees a significant drop in house price growth in 2022 with the more affordable area of the market supporting prices.
“The latest data shows a turning point in the rate of house price growth, which we expect to slow quickly with average UK house prices up 3% by the end of 2022.”
A recent study by Nationwide found house prices rose just 0.1% in September after a storming summer of house price growth.