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What might cause house prices to bounce or sustain in 2021?


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Again, govt caught everyone by surprise. With the vaccine this time. Feel good factor now, Xmas saved, shares prices up, hpc or even a decline will be unlikely now. I'm devasted prices won't drop now.

Fair comment. I want to hear all of this to get a feel for the possibilities.

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Simple really - more "help to" schemes, perhaps that 5% scheme turning up.

The only problem is unemployment.

(good chance it'll be a big one this time, even after a vaccine is deployed)

 

Unemployment being a factor is overstated.  Most of those unemployed wouldn't be in a position to buy anyway.  

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Also I see the Halifax have started to bring back 10% mortgages which is telling

Anyone who has been on furlough or impacted by coronavirus will have trouble getting a mortgage. Until banks stop asking this question then there will be a decent chunk of people who want to buy but can’t

 

Most of those unemployed wouldn't be in a position to buy anyway.  

True - but they’ll likely rent somewhere and if they can’t/don’t pay their rent then it’ll hold their landlord back from buying more properties. 

There may not be a crash, but what has happened (for me anyway) is the option to work from home most of the time and greatly expand my target house location. This, in my view, is better than a crash as I can already afford a good (better) house in a rural area and I’m no longer competing with landlords, overseas investors, and daft loved up FTBers + Bomad to live in the same oversubscribed few square miles. 

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Unemployment being a factor is overstated.  Most of those unemployed wouldn't be in a position to buy anyway.  

That's untrue. In the regions, hospitality and retail staff do indeed buy houses and have families and stuff. When the likes of Arcadia go under its not just a bunch of students losing their parr time jobs.

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To be honest I think a bounce is possible but unlikely due to the number of unemployed and end of stamp duty holiday.  All people need to eat, pay tax, buy clothes, go to the pub and pay to live somewhere.  It’s brain dead to say mass unemployment is not going to hit the Housing market.  All those direct and indirectly impacted have mortgages.  

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To be honest I think a bounce is possible but unlikely due to the number of unemployed and end of stamp duty holiday.  All people need to eat, pay tax, buy clothes, go to the pub and pay to live somewhere.  It’s brain dead to say mass unemployment is not going to hit the Housing market.  All those direct and indirectly impacted have mortgages.  

But I think this is the crux. One way or another the fate of house prices will be decided by whether they are sensitive or not to unemployment, or whether govt props can mitigate it.

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But I think this is the crux. One way or another the fate of house prices will be decided by whether they are sensitive or not to unemployment, or whether govt props can mitigate it.

I’d say they should not spend on props for property but they are unpredictable.   I think it’s unlikely they have any ammunition left for props, it does look like they are getting ready for a lower tax take due to rising unemployment, that and a higher dole bill.  All of this come together with less demand in the economy so is all coming down, maybe 15% only but maybe lots more in some places. 

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How many buy property as a store of value, not to live in permanently?.......people here and more importantly those that buy here but do not live here......after Brexit when there will be new tax incentives to encourage overseas investment will investment be made in business including our land and buildings?;)

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The vaccine cheer won't save Christmas and the Christmas traders are already staring into the abyss.

As for a vaccine boost - aviation will take 2 years to even be 75% of what it was, that impacts those pilots hoping for a return. Add in airlines wanting to charge for overhead space and that gets the cheap family hol out.

Now just as things look to pick up we'll be in potential Brexit chaos as new rules confuse folk, even with a deal.

I can see Jan being gloomy and once vaccine rollout and full opening begins people will lose the support that was helping them stay afloat.

I know a wedding photographer who also does part-time admin - she has spent her deposit on existing and if re-lockdown in Feb / Mar she needs to repay all her rebookings and will be left with nothing. No rent holidays.

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Now for what might bounce things - insurance payments for business interruption. Gov offering more deferrals and waiving business taxes / offering up land to builders to 'get building' 

An NHS 'thank you' housing purchase loan scheme.

A student loan style Corona Loan scheme where you can borrow x amount backed by gov but only begin repaying if business back to x % of turnover ( which it won't) or it gets waived after 10 years.

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Now for what might bounce things - insurance payments for business interruption. Gov offering more deferrals and waiving business taxes / offering up land to builders to 'get building' 

An NHS 'thank you' housing purchase loan scheme.

A student loan style Corona Loan scheme where you can borrow x amount backed by gov but only begin repaying if business back to x % of turnover ( which it won't) or it gets waived after 10 years.

Good, Thankyou. 

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Another thing - all the lockdown jobs undone due to lockdowns / Christmas. For instance repair work normally done in routine maintenance.

Lockdown 'career changes' which cause everyone to start a new job, get a business loan and blow cash on a new laptop or initial outlays.

Redundancy payout meeting lockdown ending blowout.

Deferred big events - office having summer party / big birthdays missed by lockdown / family meetups

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some creative wizardy from the chancellor,and an opportunity to do one-upmanship on the SNP.

sturgeon's £500 NHS bonus has really gone down like a lead balloon,most people are thinking "are you taking the mick??"

so SUNAK announces the fiscal year 2021/2022 essential worker tax holiday!!!!

furloughed employees really can't complain, the essential workers have been slogging throughout,a lot of them also on pay freezes etc, so it would certainly be a more appropriate "thankyou for keeping the country going...now keep it going some more by having some more of your own money back to spend"

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Disagree about aviation. People are itching to have holidays and will pay whatever it takes. I expect places with good vax programmes to be in high demand. I think we’ll see full flights.

Back to housing, 2021 I think will in many areas exceed 2020 prices.

Full flights maybe, but with only 20 or 30% of prepandemic traffic, and many destinations off-limits.

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Disagree about aviation. People are itching to have holidays and will pay whatever it takes. I expect places with good vax programmes to be in high demand. I think we’ll see full flights.

Back to housing, 2021 I think will in many areas exceed 2020 prices.

Its a two way thing.....many do not want us at the moment or tests/restrictions requirements before entry....all very fluid.;)

https://www.wanderlust.co.uk/content/coronavirus-travel-updates/

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Its a two way thing.....many do not want us at the moment or tests/restrictions requirements before entry....all very fluid.;)

https://www.wanderlust.co.uk/content/coronavirus-travel-updates/

Once the dam breaks, as they say. Can’t force people to stay home for a year and not expect a huge rush once the places start opening again.

 

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The answer to the thread question is the government. How they do it is irrelevant. It will happen. The vaccine boost is the government announcement giving positivity. In reality nothing is going to happen vaccine wise for months. That doesn't matter because the sentiment is positive. And sentiment is all that is needed. I imagine 2021 will see flat house prices, nothing exciting. Which is what they want, because they know the air is pumped into that bubble to bursting point now. Another 5% in a year will not be good for long term voter intention. Haha who am I kidding?

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Once the dam breaks, as they say. Can’t force people to stay home for a year and not expect a huge rush once the places start opening again.

 

...take three weeks holiday to get one!.....unless one of the few who can come and go straight back to work because they can, would anyone want to work with them? Saw on the list that Italy will give a free test at airport if not already have neg prev 72 hour test.;)

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I really think it depends on government intervention in the economy. 

If stamp duty holiday and furlough is extended, then yes house prices may prop up higher. 

The vaccine rollout isn't going to be as quick as people think and we may not be back to normal until late Summer 2021. 

Unemployment will have some impact especially if properties start being repossessed. April onwards we will have a better idea. Also LLs will be struggling with people not paying rent so there are still factors that support a property price correction.

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