House prices climbed by an average of £4,533 in July, defying movers' fears of a Coronavirus chill across the housing market.
Compared to the previous month, house prices rose by an average of 1.7% in July as homeowners took advantage of lockdown easing and a temporary stamp-duty holiday that could save buyers thousands.
The rebound in activity reflects a number of factors. Pent up demand is coming through, where decisions taken to move before lockdown are progressing. Behavioural shifts may be boosting activity, as people reassess their housing needs and preferences as a result of life in lockdown.Said Nationwide's Chief Economist Rob Gardner
The price boost was reported in Nationwide's house pricing index, which has kept an unbroken record of property prices across the country since the 1950s.
One of the UK's top estate agents, Right Move, also reported that enquiries were up three quarters compared to the same time last year.
The company says the boom is down to thousands of people re-evaluating what they want from home over lockdown and clamouring to cash-in on the stamp-duty holiday.
On July 8th, Chancellor Rishi Sunak announced a temporary stamp duty holiday to help buyers struggling as a result of the Coronavirus.
Under the new rules, no tax will be charged on properties worth up to £500,000 in England and Northern Ireland until March 31st 2021.
The busy-until-interrupted spring market has now picked up where it left off and has been accelerated by both time-limited stamp duty holidays and by homeowners reappraising their homes and lifestyles because of the lockdown.Said Rightmove Director and market analyst Miles Shipside
However, the housing market guru cautioned that buyers should move quickly if they planned to cash in on the tax holiday.
There is a window of opportunity for sellers to come to market and to find a buyer who is tempted by the stamp duty savings. Although March next year may sound like a long time away, in reality, sellers need to find a buyer before Christmas, to allow a further three months for completion of the legal process to beat the deadlinecontinued Miles Shipside
According to the Treasury, nine out of ten buyers completing a move from their main residence during the tax holiday won't pay any stamp duty at all and will make a saving of £4,500 on average.
Other estate agents have noted an uptick in the number of buyers looking to move away from the city, lining up with the theory that lockdown-induced contemplation of priorities has prompted many to enter the market.
It can't be denied that lockdown really emphasised the need to move for many, particularly those who were considering upsizing or leaving London for the commuter belt and we expect this to continue, particularly as workers are told they may not be going back into the office until next year.Said Martin Walsh, Director of Cambridge estate agent Cheffins.
Wilkinson Grant & Co., which has branches trading in coveted getaway locations across the South West also noticed a rise in the number of out-of-area buyers, stirring up healthy competition in the market as many listings fetched 'in excess of pre-lockdown valuation guides'.
The unexpected boost in prices completely overturns economists' expectations, who told a Reuters poll in June that they expected a dip in the market.
However despite the reassuring summer bounce-back, Nationwide has warned hopeful buyers to expect a volatile rush in March next year as buyers scramble to finalise sales before the end of stamp-duty holiday on March 31st.
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