If the results of a recent Rightmove study are anything to go by, UK property prices may not have been quite as catastrophically hit by the coronavirus outbreak as expected. Comparatively, sluggish performance was never in any doubt, though an apparent 0.2% fall in average property prices for March is not nearly as dramatic as some had predicted.
A housing market in lockdown
The mandatory lockdown imposed across the UK makes it practically impossible for property transactions to take place in the normal way. As a result, the housing market in its entirety entered its own state of lockdown and almost stalled entirely.
Average UK property prices have been knocked off their all-time highs by Covid-19, though the damage done to date might not be as severe as expected. Economists and estate agents had expected dramatic (if temporary) plummets in average house prices across the country, though this apparently has not been the case.
According to the latest figures from Rightmove, the average newly advertised home put up for sale in April had a market value of £312,000. This represents a decline of just 0.2% from the month before, though importantly is still an impressive 2.1% increase on the same month last year.
This would suggest that while the coronavirus crisis may have brought about a period of sluggish performance, the housing market hasn’t come close to collapsing.
A slump in physical sales activity
UK property prices may not have been impacted severely by the Covid-19 outbreak, but lockdown has certainly taken a toll on the industry as a whole. A significant slump in activity has forced many estate agents to furlough employees, with interest among buyers and sellers having reducing.
At the height of the slump, Rightmove reported that visits to its website were down by as much as 40%, which occurred shortly after the lockdown was announced by the UK government.
In the meantime, interest and activity has apparently “started to recover” according to Rightmove. In addition, evidence suggests that the collective efforts of buyers, sellers, banks and conveyancers to keep things moving is helping the property market as a whole to retain at least some level of buoyancy.
Fewer new sellers were listing their properties for sale during March, though the vast majority of sellers who had already begun marketing their properties chose not to withdraw their homes for sale. As a result, property availability at Rightmove is down just 2.6% since the beginning of lockdown.