The Portsmouth and UK property market defied economists’ forecasts. With the economy now a shell of what it used to be, unemployment has peaked at 11.9%, leaving the government no choice but to borrow nearly a half -trillion pounds to enable smooth management of the coronavirus.
Although the pandemic has hit the government hard, the impacts have not deterred Portsmouth owners’ zeal to return home. Mandatory work-from-home and lockdown regulations have emotionally swayed people and helped them save money on stamp duty bills.
A strong wave swept through the Portsmouth property market and people wondered how long it could withstand the tide. Is it likely to crash, settle calmly, or will it tumble and emerge strong as always?
Factors Influencing Portsmouth Property Market
According to the Land Registry, house prices in the UK rose 4.7% in one year, but the price spike was only 3% in Portsmouth. Owners need not worry as the market is improving across the country in line with data provisions. The register provides data months late on completed home sales; information may not reflect current market prices.
Portsmouth property prices ease after stamp duty holiday
In the recent past, anecdotal findings predict clients using their saved stamp duty to pay for their dream home in Portsmouth. However, it is likely that once the stamp duty holiday expires in the spring, Portsmouth properties will depreciate. As a result, buyers will keep their money for payment of the stamp tax.
Mortgage approvals are more useful in telling how the real estate market is doing, as many buyers will choose to maintain one. Lending institutions are where the absolute numbers are recorded: for example, Bank of England figures show they approved 97,500 mortgages towards the end of 2021.
You should always take the help of residential property legal advisers in Portsmouth before you make your decision to buy or sell a property, as they can offer you expert legal advice.
The figure rose from the monthly 65,400 marking the biggest increase in approvals since September 2007. It was a third higher than the number of mortgage loan approvals in February 2020 during Boris Bounce property market days.
Nationally, beating 2019’s total mortgage approvals of 524,000 has yet to be challenged. It’s also worth noting that not all mortgage approvals translate directly into people moving out as real estate sales fail.
It is significant that most Portsmouth residents who buy or sell homes do not realize their plans. This is due to the change in stamp duty rules in March 2021, hence the delay and huge backlog with mortgage lenders and authorities, lawyers, searches and property experts. A combination of these factors ends up slowing down the whole process.
If you’re already in the buying chain, constantly talk to all parties involved to make sure they’re focused on delivery. Getting feedback from them quickly is proof of responsibility, and you can get the new house sooner. Also, if a party withdraws from the chain before the end of the stamp duty holiday, you lose the discount due to the chain breaking.
End of stamp duty holiday in March
Moves in Portsmouth automatically fall once the stamp duty holiday ends, and this is the most significant influence on the Portsmouth property market. Real estate prices will rise after the stamp duty holiday, but the number of sellers does not influence the fall in real estate prices.
People may have various reasons for selling their property in 2021 such as the loss of jobs which is rampant across the world. Sales of properties influenced by hostile forces are called forced sales. In 1988 and 2008, business owners went bankrupt due to credit crunch and loss of jobs.
As a result, house prices in Portsmouth fell as the market was flooded with properties for sale over a limited period. There was the cushion of Bounce Back Loans, Furlough and Mortgage Holidays in the same window for nine months. Interest rates and loan amounts also fueled the housing crash.
Interest rates will determine the future of Portsmouth property market
During the two stock market crashes of 1988 and 2008, mortgage interest rates were 11.5% and 6% respectively. Compared to the current market, mortgages were more expensive than the current rate by 0.1%. Additionally, 77.2% have fixed rates, with only 1 in 21 mortgagees owing more than 90% of the home’s value. In 1988, negative equity was the biggest problem: 1 in 303 mortgagees owed more than 95% of the home’s value.
Most Portsmouth owners have a better chance of selling their homes than they did in 1988 and 2008. Sellers are likely to hold on to their property until there is positive activity in the Portsmouth property market. When the owners settle on the property, the people concerned are the real estate agents, the notaries and the movers.
Investment opportunities are exciting things that could happen if capital tax regulations change. Those wishing to do business should keep their ears open and forge relationships with the relevant agents in Portsmouth so they know when the time is right. You may not know when real estate portfolios are for sale because they can sell out of the market.
Factors influencing the future of the Portsmouth property market
The Portsmouth (surfer) property market has appreciated 46.8% since 2009, and here are the influencing factors.
- Extremely low interest rates mean borrowing money is cheap and mortgage payments are low, which could last for a while.
- Increase in the demand for housing since the annual net migration has been 214,400 since 2009. This means that more households (96,700) are needed each year.
- Since 2008 people have been living longer in the UK resulting in a delay in bringing property to market. This means there is a need for over 290,850 households in the UK for each additional year of life.
NOTE: All of these factors are constant due to COVID-19.
The country has built an average of 165,100 homes per year since 2009. The instability of supply and demand shows that the internet will have long-term housing demands, and the final verdict is that the Portsmouth property market is improving. The culmination of these issues means that the demand for suitable accommodation in Portsmouth is long term as long as the property meets the needs of tenants.
Cyndy Lane Story