Following a post-lockdown boom, UK house prices hit a record high, with the average home being worth around £245,000. Halifax found that – compared to the same time last year – properties were 5.2% higher and property values were up 1.6% month on month.
Despite this, according to a report from the CEBR (Centre for Economics and Business Research), UK property prices are expected to fall by the end of the year and into the first half of next year as the country’s economy-supporting measures come to an end.
Average house prices are expected to be 13.8% lower in 2021 than in 2020.
The post-lockdown increase is thought to have been a result of the backlog in demand that came after lockdown first hit; nearly 150,000 transactions were postponed between March and June. The amount of measures introduced by the UK Government to revitalise the economy – such as the Stamp Duty Holiday and the Job Retention Scheme – supported furloughed workers during financial difficulty and encouraged them to return to the market after spending more time at home and desiring a bigger home.
The likelihood of a no-deal Brexit and a looming job crisis when the furlough scheme ends in October hints at house prices dropping in the next coming months. The uncertainty of life after the financial measures implemented has prompted many property experts to predict a “downward pressure” on the housing market.