'It was ridiculous': Why the housing market will 'remain strong' into 2022
- Credit: Kayla Allman
Price wars, “gazumping” and tears of joy, is what house buyers in Norfolk experienced this summer and experts say this could continue well into 2022.
When the UK came out of lockdown, stamp duty tax was put on pause, creating a frenzy action in the housing market.
Many feared the end of the tax holiday in 2021 would cause the bubble to burst. But a Norfolk estate agent has said he believes this won’t be the case.
In Norfolk, house prices dropped slightly by 0.6pc in July compared to June - according to figures released by the Land Registry - but this was the first-time prices in the county had decreased from the previous month since May 2020.
And year-on-year, the annual growth remains in double digits for the third month in a row with property prices having grown by 10.1pc on July 2020.
You may also want to watch:
The rise in prices could be attributed to the stamp duty holiday - which came into play in July last year to help boost the housing market - or even due to the low borrowing rates for mortgages.
But Jamie Minors, managing director of Minors & Brady estate agents, believes there is more to the price boom than this.
- 1 Man dies after medical emergency on beach
- 2 Man arrested on suspicion of drink and drug driving after fatal crash
- 3 Jets heard roaring over Norwich for training exercise
- 4 'Glagoon' returns to Norfolk beach and locals are loving it
- 5 Appeal to identify man, around 75, who died in medical episode
- 6 Gilmour advised to quit City for Rangers loan return
- 7 Norwich mum and daughter duo shed 12st
- 8 ATM containing thousands of pounds stolen from petrol station
- 9 Family pays tribute to man killed after collision with double-decker bus
- 10 Former factory site to become a new church
He said changes to our ways of living brought on by the pandemic may be proving a motivating factor, with increase in demand for houses driving people into bidding wars.
“We have had a cultural change,” he said. “We are still in this Covid world which has put a lot more emphasis on our homes. People are valuing their own space a lot more.
“There has been so much talk about whether the housing market will crash after the stamp duty holiday,” he added. “But it’s quite clear right now that it won’t and that isn’t happening because we have such affordable lending.
“Banks are the cheapest they have ever been and demand is still there because we are not building enough homes.
“Savills did a big market research project and they believe that house prices could grow another 20pc in the next five years.
“So many sceptics are waiting for this bubble to pop but I don’t see that happening for a while.”
In lockdown, Simon Thomson, 57, was renting an apartment in Norwich, but as life returned to normality, he said wanted to get back on the housing ladder and move back to his home-town of Gorleston.
He was keen to make the most of the stamp duty holiday, but found the market was far more competitive than he imagined.
“I would see a house I liked and I would put an offer in,” he said. “But within an hour the estate agent called back to say there had been a bigger offer or the house had gone.
“That happened with about four houses in three weeks. It was ridiculous. Everyone was gazumping everybody.
“There was one for £240,000 I put a bid in for £242,000 and I was still getting out bided. But I didn’t want to get embroiled in a price war. That's why I lost out so many times.”
He eventually found a mid-terrace three-bedroom house on Avondale Road in Gorleston, after the previous buyers pulled out. He moved in mid-June.
Over the last year, the average sale price of properties in Norfolk has risen by £23,000 compared to an increase of £19,000 across the UK.
And this made it even more challenging for first time buyers to make the step onto the property ladder - despite record low borrowing rates for mortgages.
Kayla Allman and her fiance Scott Coleman also moved into their first home in Heartsease, Norwich, this summer, after spending years saving.
“I’m 29 and my fiancée is 31 and we have been together for about three-and-a-half years but when we me we hardly had any savings,” she said.
“I’m an accountant and Scott is a teacher so get decent wages and we decided to start putting away £250 to £400 a month each. Over the course of those years our savings jumped up.
“We had no help from family and we did everything ourselves. But it is definitely hard to save when you are renting and you have to make a lot of sacrifices.”
In August this year they finally got the keys for their three-bedroom end terrace for £205,000.
She added: “Hearing your family members say they bought their house for £35,000 way back when and now you’re finding a two or three-bedroom house in Mile Cross for no less than £190,000 to £200,000, which was crazy.”
First-time buyers in Norfolk spent an average of £209,155 on their property – £18,000 more than a year ago - whereas former owner-occupiers paid £282,669 on average in July, 35.1pc more than first-time buyers.
And 28-year-old Chloe Ingram said the market had forced her to forgo her dream of finding a property in her hometown of Gorleston to find somewhere that fitted her needs.
She instead opted to buy a property in neighbouring Great Yarmouth for £73,000.
She said: “It’s really difficult for first time buyers. I was lucky because I knew I would never be able to buy a house while I was renting. So, for 18 months I moved back in with my mum. But not everyone is lucky enough to be able to move in with family.
“It’s about managing expectations. I thought my first house would be a three-bedroom house in Gorleston somewhere and my forever home but I had to manage my expectations in the current climate. I had to give up the location of Gorleston to get on the property ladder.”