House prices are set to hold firm for the remainder of the year, despite the onset of recession and rising unemployment, according to Zoopla.
Its latest monthly house price index is performing at its strongest for five years, with the volume of sales agreed per agent up 76% on the five year average with no sign of immediate deterioration in price growth.
Zoopla say that despite the short sharp recession in 2020, extensive Government support for the economy and labour market, together with the support for mortgage holders, has reduced the number of forced sellers and limited the downside for house prices.
It adds that while the economy has contracted sharply and unemployment is rising, consumer spending has rebounded and various surveys of economic activity are pointing to a wider rebound in the economy.
While the unwinding of the furlough scheme and other Government support is the next challenge that will test the strength of economic recovery. Zoopla believes the average UK house price will end the year two or three per cent higher than at the start.
The post lockdown market rebound shows little signs of slowing. The cumulative increase in buyer demand since the start of 2020 is 34 per cent higher than over the same period in 2019 and despite the holiday season, it remains unseasonably strong.
Higher demand for homes has brought more sellers. While the impact of lockdown means the supply of new homes for sale is below volumes recorded last year, the gap is closing.
Huge demand means the average time to sell a property since the lockdown restrictions were lifted is now 31 per cent lower than the same period a year ago.
Source Yorkshire Post 29th August 2020