House prices to soften?

An “inevitable” softening of house prices is expected this Autumn after the recent property market boom. Experts are predicting that come August, house prices won’t increase at the rate we have seen across England and Wales. This will correspond with the end of the Stamp Duty holiday and less urgency to get transactions over the line swiftly.

The recent property price boom

The UK’s property market has been highly competitive, especially among first-time buyers looking to take advantage of the Stamp Duty holiday. The competition for bricks and mortar has also been fuelled by people reassessing their priorities during the pandemic. Increased and ongoing remote working has opened up new property possibilities for families that have become less reliant on commuting routes.  

Data from Reallymoving states that the average property purchase cost just over £330,000 in June 2021. In July, this figure is expected to almost reach £343,000. But the upward trend is expected to soften by August, with the average home purchase expected to cost just over £343,000. This translates to a price increase of 3.8% in July but only an increase of 0.4% in August.

There is even better news for buyers in September, with the average property purchase expected to drop back just under £343,000, meaning a drop in price by 0.1%.

Stamp Duty Holiday the Catalysts

When the Stamp Duty holiday was introduced, there were initial concerns among market experts that this would increase competition and therefore increase property prices. This has proven to be the case in most regions of the UK.

The Stamp Duty holiday is set to end in August, which will be a catalyst for the predicted softening of property prices. With land tax to be paid once again, buyers will not be as willing to pay more for property - and a mad rush to complete purchases at extra costs will no longer be the norm.

Property market to remain strong

Despite a cooling down of property prices, the market is expected to remain strong. Some experts predict the market will continue to be stable and driven by changing demands, such as a move away from urban living in line with continued remote working. Some buyers may have put their property purchase plans on hold until after COVID restrictions as a way to avoid additional stress and worry.  

So, should you wait to buy?

There is no clear and definite answer if you should buy now or wait until the average property price drops. It will depend on a number of personal factors and if you qualify for the stamp duty holiday. It’s best to consult with professional mortgage advisors for support and guidance. Euxton Mortgages is on hand to clarify the situation and help you secure the most advantageous mortgage for your family.

Speak with us, today!

August 2021