What to look for in the 2021 property market

What is going to happen to the UK property market in 2021? That's the $64 million question. Currently, the year looks set to get off to a good start, a hangover from the end of last year when property prices and house sales increased. We all know that nothing lasts forever but will the current good times come to a staggering halt sooner than later? Several support programs are due to end on March 31, which could be a problem for the economy and housing market. So, eyes down, here's what we're all looking out for in early 2021.

1) Stamp Duty Holiday

This property tax reprieve, which was put in place in July, cut the stamp duty rate to zero per cent for all homes £500,000 and under, which gave the housing market a boost. If the market is struggling when it ends or if transactions take too long to complete, the holiday may well be extended. In November, several trade bodies from across the industry wrote to the Chancellor of the Exchequer asking for a holiday extension to give them time to cope with demand and ensure deals go through.

2) Furlough Scheme

The extension of the furlough scheme until the end of March gave vital protection to some homeowners, with the government paying 80 per cent of employees' wages, up to £2,500 per month. The end of the furlough scheme could trigger a slew of job losses, which are expected to drive down house prices.

3) Help To Buy: Equity Loan Scheme

Despite calls for an extension, Housing Minister Christopher Pincher said there would be no changes to the deadline to be eligible for the scheme; your homebuilder must complete the property so it's ready to be lived in by February 28, 2021. Short extensions may be possible for people who have experienced severe delays because of the virus.

4) Mortgage Payment Holiday Scheme

The end of the pause on monthly repayments could spell trouble for some homeowners. However, if you're still experiencing financial difficulties because of the coronavirus outbreak, your lender might consider any of several options to help you. These include extending your mortgage payment holiday, increasing the length of your mortgage term, spreading your deferred payments over the outstanding mortgage term and making interest or capital only payments during a mortgage holiday.

Further Extensions?

Despite the buoyant market at the end of 2020, many experts predict that it will soon run out of steam. Four support schemes ending at once could spell disaster. However, they've been extended before and could be again. We'll know soon enough.