Last night, UK Prime Minister Boris Johnson, set out a four-step roadmap to bring England out of national lockdown restrictions by 21st June 2021. Addressing the nation, Mr Johnson said that the overriding aim of the roadmap was to ensure that the current lockdown is the last one and that all legal social distancing rules be abolished by the third week of June.
After almost two months living under strict lockdown rules, this was the news that everyone was waiting for. Almost immediately, there was a surge in people booking holidays, restaurants are said to have been overrun with bookings via email and online booking platforms, and theatres and cinemas also saw a rush of people trying to book tickets.
Overall, the roadmap is seen by commentators as a very positive move by the government, and with a world-leading vaccination programme in place, the next few months are looking very bright for the UK. Speaking on the 4th of February, one month to the day, that England was put under tough lockdown restrictions for the third time in 12 months, Andrew Bailey, the Governor of the Bank of England, stated that he expected the UK economy to “recover rapidly” in 2021. Owing such a positive prediction to the large-scale roll out of the vaccine across the country, which has now been given to almost 20 million people.
But what does the new roadmap mean for the UK property market?
For the majority of the past 12 months, the UK property market has remained unaffected by the various lockdown restrictions that have been in place across different parts of the country. Deemed an essential industry by the government back in the Spring of 2020, property development, along with construction and people moving to a new house, have all been able to continue with measures in place to protect those working on-site and those viewing properties.
In addition, the Stamp Duty holiday announced by Chancellor Rishi Sunak in June 2020, gave a boost to the UK property market that saw demand for property skyrocket. Across the UK there was a positive impact on house prices, with some parts of the country seeing growth of 6% compared to the previous year.
With Rishi Sunak due to deliver the Spring budget on March 3rd, those in the property market will be waiting to see if this tax break will remain in place. According to Rightmove, the UK’s largest property listing site, if the Stamp Duty holiday is extended by just 6 weeks, then there would be up to 160,000 property transactions that could benefit from the saving. Resulting in buyers saving up to £1 billion.
Regardless of if the Stamp Duty holiday is continued or not, the fact that the UK is slowly opening back up over the next few months, coupled with the continued mass roll-out of the vaccine, demand for UK property will continue – with many predicting the growth in house prices for 2021, could outperform the previous year.
For international investors, the window of opportunity that currently exists due to a slightly weaker pound will also close. As the UK economy starts to recover rapidly, the cost of investing in the UK will increase due to fluctuations in exchange rates. Making now a great time to invest before the pound starts to increase again in value.
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