Market Overview

UK house prices fall as buyers struggle for time to beat stamp duty deadline

Property prices are falling as buyers surge to find more homes amid the COVID-19 pandemic, despite slim chances of beating the stamp duty holiday cutoff date. According to data from property portal Rightmove (RMV.L), the number of sales agreed is up by 9% so far year-on-year in January. Sellers are continuing to price very competitively, with newly-marketed property asking prices down by about 0.9% — £2,887 ($3,920) — on the month.

Many sellers may still be hoping to find a buyer and complete the sale before the stamp duty holiday comes to an end on 31 March — though the odds are stacked against them, Rightmove noted. Last year also had a very active start, being buoyed by the post-election “Boris bounce.” This came to an abrupt end with the first COVID-19 lockdown in March and the temporary closure of the housing market, the experts explained. But, it was followed by a far stronger resurgence as people reassessed their housing needs and priorities following their experience of lockdown.

Despite temporary market closures in 2020, people’s housing needs meant the number of sales agreed was up by 10% for the whole year compared to 2019. With the UK once again in lockdown, there are early signs it will surpass 2020’s new-year surge in activity, with the number of prospective buyers contacting agents between 2 and 12 January up 12% year-on-year the number of buyers contacting agents rose by 12%.

Rightmove said that visits to its website have continued to increase since the start of January, and are up by 33% on the same period in 2020. With Rightmove analysis showing it currently takes 126 days from the time an offer is accepted until legal completion, new buyers should not be factoring in any stamp duty savings. This is unless they are first-time buyers, who will still be mainly exempt after the March deadline has passed.

UK house prices fall as buyers struggle for time to beat stamp duty deadline, Bloomberg, Jan 18

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