Recent market reports from the U.K. housing industry have seen that the markets rebounding after a dip in March and April, doing much better industry watchers, estate, and letting agents could ever have hoped for. Experts have compiled data and showed the trend that the housing market was affected by the COVID-19 outbreak not only in the United States or the United Kingdom but all around the world as well. When COVID-19 hit, most buyers decided to step back from the market and wait it out. This was most keenly felt in April when house transactions fell to a record low after a month in lockdown.
There were 38 thousand housing transactions that month, less than half the number in the same month of the previous year. In the following months, however, government support, as well as the gradual opening up of businesses, drove an upward trend in the housing industry. The Nationwide Building Society reported that annual house price growth was at a five-year high in October.
In the early months of summer, the United Kingdom started to see a slow uptick in the number of listings on the market. With more purchases being made once more, the numbers continued to increase, and by the start of July, the industry saw more listings than they did even way back toward the end of the winter, at the beginning of February.
However, experts caution against betting heavily on the housing market, making a full recovery in 2020. As the government’s furlough scheme comes to an end in November, a wave of unemployment may trigger another contraction in the housing market, which had been buoyed by people looking for homes with extra space during the coronavirus pandemic. When more people lose jobs and there is less money to go around, these purchases may dry up.
Is a market improvement happening only in the UK, or is it improving in the U.S. as well?
Though it is good news that the housing market is improving after the coronavirus pandemic started in the United Kingdom, many experts wonder if the same trends are happening in the United States.
The good news is that though a lot of buyers and sellers certainly chose to go the conservative and cautious route and try to wait out the pandemic to do anything with their housing, the market actually did not take too deep of a cut in the United States. In fact, the U.S. had a similar “mini-boom” in the summer months, which led many to claim that real estate had a “pent-up demand” — when a buyer is unable to buy in March and April, they will still buy when restrictions ease.
The year 2020 has been marked with unpredictability. But it hasn’t proven to be all doom and gloom — resilient markets and some smart fiscal moves by the government both in the U.S. and U.K. can help stymie some of the worst effects of the pandemic on the economy. Let’s keep our fingers crossed that this upward trend holds.