Housing market still "defying all expectations"

26 May 2021

John Phillips, national operations director, Just Mortgages and Spicerhaart said:

“Although monthly transactions are down from the record highs in March, April was another impressive month for residential moves. Last month recorded the most transactions in any April since 2007, and while the market does appear to be slowing somewhat, it is still defying all expectations.

“The big question now is: how long can this last?

“With the end of the stamp duty holiday on the horizon, the market may slow slightly, but demand is still likely to outstrip supply. The trends that have driven the market for the past twelve months are still relevant.

“Flexible working looks set to stay for many employees – including Just Mortgages brokers – and this will continue to incentivise moves away from offices. Outside space is still incredibly desirable, with some setting up home offices in their shed.

“Mortgage products are returning to close to pre-pandemic levels, with the return of 95% LTV mortgages helping those with smaller deposits. The only issue for borrowers is affordability, with house price increases far outstripping wage increases, loan to income multiples can be a stumbling block.

“All these factors mean, even once stamp duty ends, housing transactions will not fall off a cliff. We will see a gradual slowing towards pre-pandemic levels through Q2 and into Q3 as the market readjusts to the ‘new normal’.”