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Summary
- The country observed a surge in the house prices in October 2020
- The average house prices have hit a new record high of £227,826, according to Nationwide
- The annual growth in property values reached its fastest rate since 2015
- The buyers are also looking forward to taking advantage of the stamp duty holiday deadline, which expires on 31 March 2021
The annual growth in property values reached its fastest rate since 2015 and the house prices have hit a new record high of £227,826 on average, according to the latest statistics from Nationwide, the nation’s largest building society. The month of October 2020 witnessed housing price rise of 5.8 per cent on an annual and 0.8 per cent on a month on month basis, revealed the Nationwide Building Society.
With the gradual ease in the lockdown restrictions since July, the United Kingdom has been witnessing a surge in the house prices. Conducing government policies like the stamp duty holiday along with a change in housing preference of buyers, away from the hustle and bustle of cities towards more peaceful locales also contributed to the surge in home prices.
In September, home-buyer mortgage approval numbers climbed to a 13-year high, disclosed the figures released by the Bank of England this week.
Once the economy re-opened, the home buyers seemed more inclined towards larger homes with more space and properties with gardens.
Recently, the buyers seem to be looking forward to taking advantage of the stamp duty holiday deadline, which expires on 31 March 2021. According to market experts, this has been the main factor determining the mini boom in the UK property market.
Robert Gardner’s Contradictory Comment
Though UK house prices have been rising, the real-estate agents and mortgage brokers are of the opinion that with the stamp duty deadline nearing, it would lead to potential buyers pulling out of the home sale transactions early next year. This was the prediction of Robert Gardner, Chief Economist, Nationwide.
He added that the housing sector outlook remained uncertain in the wake of the second wave of Covid-19 infections across Britain.
However, he admitted that the behavioural shifts as a result of Covid-19 may provide support for housing market activity in the near term. But in the coming quarters, the activity is expected to slow down rather sharply, if the labour market weakens, especially once the stamp duty holiday expires by the end of March.
One cannot ignore the fact that a large pent up demand for housing which gathered during the lockdown period was being released now, fuelling the home prices across the nation, expressed Guy Harrington, the chief executive of the residential lender Glenhawk.
Let us focus on the recent performance of few house building stocks listed at the London Stock Exchange.
CLS Holding Plc (LON:CLI)
CLI stocks were trading at GBX 195.00 on 30 October 2020, at 3:00 PM, up by 1.04 per cent from its previous close of GBX 193.00. It was having a market capitalisation of £786.27 million. The company recorded a negative return on the price of 37.54 per cent on a YTD (Year to Date) basis.
St. Modwen Properties Plc (LON:SMP)
SMP stocks were trading at GBX 326.00 on 30 October 2020, at 3:03 PM, down by 1.66 per cent from its previous close of GBX 331.50. It was having a market capitalisation of £738.01 million. The company recorded a negative return on the price of 33.96 per cent on a YTD (Year to Date) basis.
Watkin Jones Plc (LON:WJG)
WJG stocks were trading at GBX 133.20 on 30 October 2020, at 3:03 PM, up by 2.15 per cent from its previous close of GBX130.40. It was having a market capitalisation of £334.04 million. The company recorded a negative return on the price of 46.56 per cent on a YTD (Year to Date) basis.
Mountview Estates PLC (LON:MTVW)
MTVW stocks were trading at GBX 10,600.00 on 30 October 2020. It was having a market capitalisation of £413.30 million. The company recorded a negative return on the price of 10.17 per cent on a YTD (Year to Date) basis.
