The latest ONS House Price Index shows that the average UK house price rose by 8.6% in the year to February 2021.
Jamie Johnson, CEO of FJP Investment, said: “The sharp rise in house prices is not a surprise – many estate agents, solicitors and mortgage lenders have spoken of being overwhelmed by the huge demand they are experiencing from prospective buyers who are eager to take advantage of the stamp duty holiday. And ever since the holiday was announced nine months ago, triggering this spike in demand, prices have risen at a healthy rate.”
“In reality, the question is what happens once the tax break ends. It is likely the market will stabilise somewhat over the summer months – but of course, until the end of September there is a staggered return to previous stamp duty rates, so I would still expect strong activity from buyers and seller until the end of the year. This should be welcomed, too. We cannot underestimate the importance of all these property transactions in helping businesses across the real estate industry rebound from the financial hardships inflicted by Covid-19.”
Paresh Raja, CEO of Market Financial Solutions said: "The performance of the property market during the pandemic has been remarkable. Yes, the stamp duty holiday has been in play since July last year, but the sheer level of demand we have seen from homebuyers in spite of wider economic uncertainty is extremely impressive, and today's ONS index underlines how this is driving up prices at a rate we have not seen in almost a decade.”
"We cannot escape the fact that a bottleneck is likely to form in the coming weeks, with many transactions at risk of not being completed before the stamp duty holiday deadline. Buyers being let down by mortgage lenders - even in cases where a mortgage in principle has been agreed - is already commonplace, so I expect to see this issue become more prevalent between now and the end of June.”
"In the medium to long term, it will be interesting to watch how effective the new government-backed 95% mortgages are in enabling more first-time buyers to get onto the property ladder. If successful, this scheme could further galvanise the entire property market in the months to come."
Iain Swatton, Head of Intermediaries at Dashly, said: "Hot on the heels of this week's low deposit scheme, house prices continue to rise. While generation rent will welcome a new opportunity to get onto the property ladder, a lack of supply, and now the chance to borrow more money coupled with the stamp duty deadline are creating more demand, and pushing up prices.”
"While London has seen the slowest growth compared to other regions, make no mistake - the property bubble hasn't burst yet."
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