Before answering that important query, it’s useful to look at some of the possible factors that led to the booming home sales market during COVID-19, and whether they will continue for a long time to come or whether the housing bubble could burst once the pandemic is behind us.
Every day it seems like newspapers and other media outlets are printing articles about the home sales boom, quoting industry observers who are delighted but amazed that it continues. As a recent article in The Guardian notes, we’re in a sellers’ market in part because of some decisions by the UK government aimed at increasing property sales.
At the outset of the pandemic, things looked bleak for homeowners wanting to sell their freehold or leasehold houses or flats. The sweeping lockdown that affected the entire country meant that prospective buyers weren’t able to go on viewings to see properties that they might have wanted to buy, which effectively put a halt on a significant number of potential sales.
News reports at the same said the effect of the restrictive lockdown and falling demand for property sales was that the average home price plummeted by almost 2 percent.
But just a few months later, during the late spring and early summer, the government revealed a number of steps that it hoped would encourage a revival in the home sales market. For example announced a suspension of the costly stamp tax duty on home purchases until April 2021. This encouraged a number of people to buy their next homes fast in a bid to avoid the tax.
And the government also relaxed restrictive lockdown rules preventing viewings from taking place, which meant that buyers could again tour the interior and exterior of homes that they had an interest in buying. These measures had the desired effect and the market soon picked up.
What might happen to home sales once the pandemic is over?
The steps that the government took to try and revitalise the property sales market were only ever intended as temporary measures and they will not be made permanent. So once the extra incentives are gone post-pandemic, will homebuying continue to soar as it has recently?
Sadly, the best answer is that it’s unclear, and there are a number of different ideas from observers about what might happen in the future. Read one news article and you’ll see predictions of doom and gloom for the future, with experts saying we’re on schedule for the market bubble to burst, which would cause demand for homes to tumble along with sale prices.
As late as last year, the consulting firm Centre for Economics and Business Research noted the “transitory” nature of the government’s various temporary programs crafted to generate interest in buying homes during the pandemic. The firm predicted that once all these programs expire, property prices could fall by as much as 13.8 percent this year compared to last year.
Read another news article and you’ll see equally highly qualified observers saying demand will linger after COVID-19. They argue that the seller’s market will continue past the pandemic regardless of the expiration of the government’s assistance programs, adding that if people believe they can keep up with their mortgage payments, then sales will remain strong.
Nobody can predict the future, but it’s not impossible to believe that after the pandemic, people will resume having longer-time ideas about their future — and that could include finally upsizing or downsizing to their dream home. Or the sheer pace of sales in the recent months could simply mean that eventually supply will become higher than demand, slowing down the market.
What should you do if you own a home and are thinking about selling?
The competing projections of the future of the housing market can make it confusing for homeowners to know whether to try selling their properties now or waiting until later.
In the worst possible outcome, the pandemic might get more severe and the government could have to impose lockdown restrictions again. This would make it near impossible for viewings to occur, which would again lead to a drop in the number of home sale transactions, because prospective buyers will not be able to visit a property to see the inside and outside.
You should also weigh your options with the method you would like to use for selling your home. Is an estate agent the best choice during an ongoing pandemic, or should you wait until the crisis is over before selling through that method? An auction might potentially make you a lot of money if your home is very popular, but will the pandemic reduce the number of auction attendees and in turn make it less likely that you’ll receive as many high-value bids on the home?
But even if the answers to these questions might deter you from wanting to sell using an estate agent or an auctioneer, or even having doubts about whether to sell now, there are other options to consider. You still have the potential to find a buyer for your home during and after the pandemic.
Even if the worst-case scenario happens and property demand starts to fall once the pandemic is finally over, you might still be able to get a fairly speedy sale by using a fast cash home buyer. There are companies like LDN Properties, investment companies that specialise in quick cash sales. These companies are able to give homeowners swift and competitive offers for buying all shapes, sizes and types of freehold and leasehold properties.
The housing market generally has always been subject to a fair amount of uncertainty, whether that’s the timing of property sales or the price at which the average home might sell. And the coronavirus pandemic has magnified those uncertainties in ways that aren’t fully resolved.