This is not a matter of opinion, the housing market is very much in boom territory. Let’s take a look at the facts.
Rightmove released an article 5th May 2021 called “The towns and cities that have seen the biggest house price growth in a year”.
Top of the list were,
Wallasey in Merseyside - 15.6%
Leigh, Greater Manchester - 12.8%
The article lists out a total of 10 places where prices are up more than 10%. The article also points out that 23% of properties listed on rightmove are being sold within 1 week, which is the highest ever.
According to research by Hamptons International, more than 37,000 houses exchanged hands off market in the first quarter of this year. That’s the highest number since they started collecting the data 14 years ago.
Land Registry Data to the end of Feb 2021 shows UK average growth running at 6.95% YoY, which is a massive growth. But the regional variation is even more eye catching. When we consider city and suburb combined the capital growth numbers really quite incredible,
Barnsley - 15.81%
Liverpool - 13.2%
Nottingham - 11.54%
Manchester - 8.9%
It’s very easy to look at this data and say the stamp duty holiday and the ‘race for space’, both brought about by Covid, are the only major causes and market growth will soon slow or even begin to retract. I would disagree.
One of the major factors that nobody seems to be talking about is government stimulus and more specifically, quantitative easing. The Bank of England has been buying government backed bonds like crazy over the past 12 months, which in real terms means debasing the currency. If pounds sterling is being devalued, why would you want to save it? Surely it makes more sense to take on incredibly cheap debt (see above) in the form of mortgages, which is what people are doing in their droves.
This is a pattern that is being mirrored the world over, governments creating moree currency and asset prices increasing.