However, the boom is not expected to continue beyond 2021 as Halifax predicts that after an initial rush to beat the stamp duty holiday deadline, house prices will fall by up to five per cent, reports the Guardian.
Halifax, Britain’s biggest mortgage lender, said that if prices do fall, it may only partially reverse the increase of nearly £18,000 that has been added to the average UK house price over the past year.
The average UK house price is now £253,243, compared with £235,353 a year ago - an increase of £17,890 - according to Halifax. A five per cent fall in 2021 would mean an average of £12,662 being wiped off the value of properties.
Russell Galley, managing director, Halifax, said: “While the economy should begin to recover in 2021, helped by the rollout of Covid vaccines, the jobs market will inevitably adjust to the changes in demand that are occurring, and unemployment is expected to rise.
“With the stamp duty holiday also due to expire in March - and lower levels of demand - housing market activity is likely to slow. Taking all of this into account, the post-summer surge in house prices is unlikely to be sustained.”
Estate agent Savills said it expects UK house prices to show 0 per cent change in 2021, but in 2022 it has pencilled in a 4 per cent increase, with a 6.5 per cent uplift in 2023.
Property website Zoopla expects house prices in 2021 to see positive growth, with stronger increases in the first half of the year giving way to more modest increases by the end of 2021.
Zoopla predicts house prices in December 2021 will be around 1 per cent higher than they are in December 2020.
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