Is the stage for a strong rebound once the shock passes?

by Property118.com News Team

9:52 AM, 3rd April 2020
About 8 months ago

Is the stage for a strong rebound once the shock passes?

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Is the stage for a strong rebound once the shock passes?

Annual house price growth rose 0.8% in March, after taking account of seasonal factors, but the sample period excludes recent COVID-19 related disruption.

Robert Gardner, Nationwide’s Chief Economist, said: “Annual house price growth increased to 3% in March, up from 2.3% the previous month – the fastest pace since January 2018 (when annual growth was 3.2%). The last six months have all seen month-on-month increases, after taking account of seasonal effects.

“It is important to note that, while we use a full month’s worth of data to generate the index, the cut-off point is slightly before the end of the month. This means that developments following the UK government’s lockdown will not be reflected in these figures.

“In the opening months of 2020, before the pandemic struck the UK, the housing market had been steadily gathering momentum. Activity levels and price growth were edging up thanks to continued robust labour market conditions, low borrowing costs and a more stable political backdrop following the general election.

“But housing market activity is now grinding to a halt as a result of the measures implemented to control the spread of the virus, and where the government has recommended not entering into housing transactions during this period.

“Indeed, a lack of transactions will make gauging house price trends difficult in the coming months.

“The medium-term outlook for the housing market is also highly uncertain, where much will depend on the performance of the wider economy.

“Economic activity is set to contract significantly in the near term as a direct result of the necessary measures adopted to suppress the spread of the virus.

“But the raft of policies adopted to support the economy, including to protect businesses and jobs, to support peoples’ incomes and keep borrowing costs down, should set the stage for a strong rebound once the shock passes, and help limit long-term damage to the economy.

“These same measures should also help ensure the impact on the housing market will ultimately be much less than would normally be associated with an economic shock of this magnitude.”


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Comments

Mick Roberts

16:24 PM, 3rd April 2020
About 8 months ago

Yes, that's what they all saying, when this is all over, we could in for good growth.
So me not being an economist, but know a little bit, I'd say to Landlords Don't get carried away with these low interest rates we have if u on a tracker. Either overpay to bring the balance down, so subsequently, the interest £'s amount they require will be lower next year, or save the money elsewhere just in case.
Don't blow it on a Ferrari or Lamborghini.

Look after your tenants, they look after u. And u can buy the Lamborghini in years to come when you've paid your mortgages off cause you've been loyal to your tenants & they've been loyal to u.

Howard Reuben CeMap CeRER

14:19 PM, 4th April 2020
About 8 months ago

Reply to the comment left by Mick Roberts at 03/04/2020 - 16:24
100% agree Mick 😁👍

When the pandemic passes and the property and finance world starts to recover some sort of normality, the lenders will not immediately jump back up to high LTV offers, so yes, reduce balances now, refinance all mortgages on to lower rates now, and take this time and use it as an opportunity to focus on the BTL business, before the market restricts further and the recovery takes longer.


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