Homeworking causes house prices to skyrocket outside UK cities
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The increase in working from home during the pandemic has pushed up house prices in areas surrounding most of Britain’s largest cities more than in urban centers as buyers seek more space, research from the UK has shown. bank of Halifax.
In areas around major cities, except London, the average house price rose 10.8% between March 2020 and June 2021, according to an analysis of mortgage transactions included in the housing price index of ‘Halifax released Saturday.
This compares to the 8.9 percent growth in housing prices in cities.
Andrew Asaam, director of mortgages in Halifax, said that during the pandemic the UK housing market had been shaped “by buyers’ demand for more space, the desire to move from the center to more suburban areas and the trend towards more homework now and in the future ”.
“It’s clear, speaking to our mortgage clients, that many have preferred space over location due to the increased time spent at home over the past year and a half,” he added.
In Plymouth, on the south-west coast of England, for example, the city saw house price growth of 5.8% over the period, while in surrounding areas prices soared by 16, 1%.
In Leicester, in England’s East Midlands, residential property prices jumped 6.5%, but in surrounding areas they grew twice as fast, with the more rural Rutland and Melton, up 22.5%.
Separate data from Hamptons realtors released on Friday showed Londoners bought 61,380 homes outside the capital from January to June 2021, the highest figure for six months since 2006.
“The pandemic-fueled outward migration from cities shows no signs of slowing down,” said Aneisha Beveridge, head of research at Hamptons. “Buyers in London now want a house with a sea view, more open spaces and a cleaner, less cluttered environment. ”
The results match official data which showed that the annual growth in house prices in June was about twice as fast for single-family homes as for apartments or maisonettes.
The figures also suggest that the increase in demand for housing, as many people reassessed their need for space, was a key part of the price spikes during the pandemic, in addition to low interest rates, increased household savings and stamp duty holidays.
From July 1, the threshold up to which buyers in England avoid paying stamp duty fell from £ 500,000 to £ 250,000, leading to a sharp drop in residential transactions last month and a slowdown growth in house prices.
But many analysts predict that the UK housing market will remain resilient even after October, when tax thresholds return to the levels charged in July 2020, before the government decides to stimulate the housing market after the first coronavirus lockdown.
Ashley Thomas, director of London-based mortgage broker Magni Finance, said the stamp duty holiday didn’t make much of a difference for people buying expensive property. “A large garden and being in the country or near a beach have become a default setting for many high-income buyers. ”
Andrew Wishart, a real estate economist at the consultancy firm Capital Economics, said the very limited housing stock resulted in “continued strong competition among buyers. This is consistent with our view that house price growth will cool down next year rather than collapse. “