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English property market rebounds

A release of demand for property in England, suppressed by the lockdown, pushed the number of sales agreed in early June above pre-coronavirus levels. 

Rival property website Rightmove last month reported a big spike in searches for homes in the countryside with good transport links and “out of city” locations – ranging from English market towns to Scottish fishing villages – where people could split their working week between home and office once life starts to return to normal.

Four weeks on from the reopening of the property market and Zoopla have reported a rapid rebound in demand for homes – followed by an unprecedented rebound in new sales agreed – which are now tracking close to early March levels.

Zoopla have estimated that demand for housing is now 54% higher than at the start of March, as pent-up demand returns to the property market. This is measured by looking at the number of property hunters who are actively engaged in finding out more about a property, including by making online enquiries.

New sales agreed are just 12% lower and the number of new sales agreed has risen by 137% since the market reopened.

And the average asking price of sales agreed in the last week was 6% higher than a year ago.

Changes in demand

London appears to be lagging behind other regional markets in England as buyers look outside the capital.

The biggest boost to sales has been in higher price brackets, with the number of sales of £1m-plus homes 16 per cent above early March levels.

Zoopla believes the pandemic has not just created a one-off boost to demand but brought a whole new cohort of would-be movers into the housing market.

The rival property portal Rightmove last month reported a big spike in searches for homes in the countryside with good transport links and out of city locations.

Zoopla director of research and insight Richard Donnell says: “The rebound in housing demand over the last month is not solely explained by a return of pent-up demand. 

“Covid has brought a whole new group of would-be buyers into the housing market. New sales in London are lagging behind as buyers look at commuting and moving into the regions.

“Higher asking prices for newly agreed sales means that house price indices may not register immediate price falls.

“Lower asking prices for homes sold over the lockdown period may drag down indices over May, but this new data suggests house price growth is set to remain positive in the next two months.

“We still believe that this spike in demand will be short-lived as the economic impacts of covid start to feed through into market sentiment and levels of market activity in 2020 H2.”

Scotland and Wales continue to record low levels of new sales as their markets remain closed. Their housing markets will re-open on the 18 and 19 June respectively.

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