Prices for UK houses rise as COVID pushes buyers to look for space

Image source: PA Media/British Broadcasting Corporation

United Kingdom this year has been driving buyers to seek more space in houses that will last well into 2022, increasing their average price by 7.3 per cent over the past year to GBP 230,700, according to a report from BBC News.

Zoopla, the property website of the British real estate company ZPG, told BBC News that the British’s demand for houses is twice as high as seen this season between 2017 and 2019, draining the demand for apartments and leading to a disparity between the average growth of prices between houses and apartments, but both of them are in short supply.

The company stressed that a severe shortage of homes for sale has been supporting the prices of houses in part, with levels of stocks falling by about 25% in the first half of the year from 2020.

Grainne Gilmore, head of research told BBC News that the company saw the rise of demand for houses in the first lockdown in the United Kingdom, adding that many owners in Britain have been reassessing where they want to live”.

Gilmore stated that many of them want an extra space for an office or a space for their garden with the rise of working from home during the outbreak.

She said, “A cohort of buyers has eroded the supply of family houses and put upward pressure on house prices more than flats over the past 12 months… That’s a situation that we would expect to continue into 2022”.

Zoopla said that the average price of a house in the United Kingdom has been jumping to 30 per cent since 2007, when the typical price of a house there is GBP 177,300.

Prices of houses have been increasing by 5.4 per cent annually in June alone, even though the demand of buyers have been dropping by 9 per cent due to the impending end of the holiday of duties on stamps. The sales agreed this year still exceeds average levels last year by 22 per cent.

The prices of houses in Wales have been growing at 10.2 per cent and Northeastern England at 8.8 per cent as more Britons have been moving away from urban areas.

Those of apartments have been growing the most in Scotland at 5.2 per cent and the English Midlands at 3.7 per cent.

Only the prices of houses and apartments in London have been remaining low at 5.6 per cent and 0.5 per cent respectively.

Zoopla told BBC News that it was also observing from 2017 to 2019 the rising demand for properties in outer London toward 86 per cent, but it expected sales in London to improve absent any more setbacks during the outbreak, given the resurgence of the rental market in the United Kingdom.

It said, “Further relaxation on the restrictions around global travel will result in a firmer pick-up in demand, which will also reverse the downward trend in pricing”.