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Value of homes sold doubles as demand reaches new highs

The value of homes transacted has doubled compared to last year as demand for property hits new highs while supply is restricted.

The total value of homes sold is £149 billion which is double the value of transactions last year for the first quarter according to the Zoopla House Price Index as buyer demand hits new highs.

Demand from first time buyers and home movers exceeds the supply of new properties on the market as the imbalance continues as homeowners prefer larger homes with more space.

See the mortgage you can have and the monthly repayment costs if you are buying a larger more spacious home at this link:
Home mover mortgage cost calculator with instant figures to buy a larger home.

Annual house price growth is 4.0% with average property values of £227,400 with stronger growth for Manchester up 6.5% and Liverpool rising 6.3%.

For older homeowners the rise in house prices gives them an opportunity of buying a new house with equity release and accessing cash such as to buy a new car or gift to children or grandchildren.

Limited supply of family homes

The supply of home for sale on the market is -28% lower by April 2021 compared to the periods for 2018 and 2019.

In particular the availability is constrained for family homes with demand outsrtripping supply as homemovers take account of lockdown and the need for more space when working from home.

This has been made worse with higher numbers of first time buyers looking at getting on the property ladder and have no property to sell.

The lack of supply was exaggerated by sellers delaying putting their property on the market at the start of the year due to fears of Covid 19 and viewings from potential buyers.

As children returned to school in mid-March the supply of new listings increased by 30%, however, this was not enough to meet demand for family homes.

Family homes remain the most popular property type with 3-bed homes representing 25% of the total supply on the market down from a third in 2017.

In total 59% of all listings are houses down from 76% in 2017 whereas the number of 1-bed and 2-bed flats listed has increased as home movers search for more indoor space with access to a garden.

More flats on the market could also be due to buy-to-let landlords selling properties in anticipation of changes in taxation and legislation with greater protection to renters such as ending ‘no fault’ evictions.

Demand likely to reduce over time

Demand has been helped by the stamp duty holiday on properties worth up to £500,000 which was extended from 31 March to 30 June 2021.

From 1 July 2021 to 30 September 2021 the stamp duty holiday will apply for properties worth up to £250,000 and return to the standard amount from 1 October 2021.

Rather than moving home, remortgage buyers can add more space to the property such as a loft conversion or extension by using their mortgage for an advance.

As lockdown comes to an end it is likely that buyer demand will reduce over time although it is expected to remain above average levels until the end of the year.

Demand currently remains strong and is 118% higher than 2017-19 in particular for cities with average property values under £200,000 such as Birmingham, Liverpool and Leicester.

This is reflected in the growth of house prices in these cities with Liverpool up 6.3% and average value of £130,600, Leicester rising 5.1% and Birmingham up 4.4% over the year.

What are your next steps?

Speak to our LCM mortgage advisers if you are planning to move home to a larger property and want the best mortgage deal. Learn more by using the property value tracker chart and equity release calculator.

Start your free home moving quote and we can find the best mortgages and lowest rates for your new property at this link:
Free mortgage quote with the lowest rates for moving to your new property.

If you are releasing equity from your home to maintain your standard of living or buy a dream home, we can recommend lifetime mortgages so begin your equity release quote for the latest provider offers.

Mortgage Best Buys

These are examples of mortgage products we can approach with many more offering interest rates and flexibility to meet your needs.

1.18% Fixed Rate
60% Loan to Value
£1,034 App Fee
Until 31/10/2022
Reverts to 3.59%
1.16% Fixed Rate
60% Loan to Value
£1,525 App Fee
Until 01/11/2022
Reverts to 4.09%
1.19% Fixed Rate
60% Loan to Value
£999 App Fee
2-Years Time
Reverts to 3.59%
1.17% Fixed Rate
60% Loan to Value
£1,025 App Fee
Until 31/09/2022
Reverts to 3.59%

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    Equity Release may involve a Lifetime Mortgage or a Home Reversion Scheme. To understand the features and risks, please ask for a personalised illustration. Equity Release may affect your entitlement to means tested state benefits and will impact on the size of your estate. For Equity Release London City Mortgages charge a fixed fee upon completion of £695. For Mortgages a fixed fee is charged on application. Typically this is from £295 up to £495 for the services selected.


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