The value of homes changing hands has nearly doubled in the first 15 weeks of this year compared with the same time period in 2020.
One in every 50 homes was sold subject to contract between 1 January and 15 April, up from one in every 100 homes a year earlier, according to our latest House Price Index.
Overall, properties collectively worth £149bn have been transacted during this time period, a level that would not normally be reached until the end of June, as the pandemic-led search for space continues.
Glasgow, Bristol, Nottingham, Stoke-on-Trent and Middlesbrough are the five busiest housing markets.Download the full report
What's happening to house prices?
Annual house price growth tracked at 4% in March, down from 4.5% in January. While this indicates a slight softening in the pace of growth, it remains nearly double the 2.1% recorded for the same month last year.
Northern regions, where affordability is less stretched, continued to see the biggest increases, with Wales leading the way with a rise of 5.9%, followed by Yorkshire and the Humber at 5.3% and the north west at 5.2%.
By contrast, in London, which has the highest average house price for any region, annual growth was just 2%.
Cities in northern regions also logged the biggest price gains, with Manchester and Liverpool retaining the top spot at 6.5% and 6.3% respectively, followed by Leeds, Nottingham, Leicester and Sheffield, which also saw rises of 5% or more.
At the other end of the scale, prices fell by 1.7% in Aberdeen, as the city’s property market continued to be impacted by the fall in the oil price, while Oxford and Cambridge, which have high average house prices, recorded relatively muted growth of 1.6% and 2% respectively.
How busy is the housing market?
Home buyer appetite peaked in the week following Easter, when it was running at double the level seen in the comparatively normal markets of 2017 to 2019.
It is currently 27% higher for the year to date than in 2020 as the stamp duty holiday continues to stoke demand.
There has been a slight slowdown in interest from potential buyers since lockdown was eased on 12 April, as households focus on catching up with friends and family and enjoying leisure amenities that have not been available since January.
The intense activity has led to a sharp drop in the number of homes on the market, with supply in the first half of April nearly 30% below the levels recorded for the same time period in 2017 to 2019.
Furthermore, the total number of homes listed for sale so far this year is 19% lower than average levels recorded in 2020, despite the 50-day closure of the housing market in England (and longer in Wales and Scotland) last year when little-to-no homes were put up for sale.
The third lockdown also saw an increased lag time between homeowners looking for a new property and listing their current home for sale, further exacerbating the imbalance between supply and demand.
That said, the tide does appear to be turning, with evidence suggesting listings have started to rise again since schools re-opened six weeks ago.
What could this mean for you?
A rising number of first-time buyers are coming to the market, buoyed by the government’s new mortgage guarantee scheme and the return of mortgages for people with only small deposits.
The situation is putting pressure on already constrained levels of properties for sale, although availability is better for flats than it is for family homes.
Even so, competition is likely to be intense, and buyers will need to move fast when they see a home they like.
Homeowners and landlords
As the pandemic-triggered search for space continues, three and four-bedroom houses remain in high demand.
It means that homeowners and landlords who are considering selling a family home are likely to be in a prime position.
But they may face a shortage of choice when looking for a new property to buy.
However, as more homes come onto the market now that schools have re-opened, the choice is set to improve.
And homeowners and landlords preparing to buy a new property now could still be in a position to take advantage of the stamp duty holiday.
What's the outlook?
The imbalance between the supply of homes for sale and buyer demand will start to ease in the near-term as homeowners become increasingly comfortable opening their homes for viewings.
The scale of buyer demand is also expected to moderate as the roadmap out of lockdown continues and there is some return to pre-pandemic normality.
Grainne Gilmore, head of research, at Zoopla, explained: “The fundamental imbalance will remain. Demand will remain strong as the ‘search for space’ among homeowners has further to run, especially as some office-based businesses are now confirming how their working practices will change in the longer-term.
“More flexible working arrangements open up new opportunities for homeowners to move to a further-flung location.
“At the same time, the roll-out of the 95% mortgage guarantee will mean more demand from first-time buyers, fuelling demand without replenishing supply.”
House price growth is also expected to ease as the extreme imbalances between supply and demand start to unwind, while the end of the stamp duty holiday and the paring back of government support over the summer will also act as a drag on the market.
That said, property values will continue to be underpinned by the shortage of homes for sale, with growth likely to be strongest in the more affordable markets in the north and Midlands.
How Zoopla can help
If you’re considering selling, check out My Home for a house price estimate and see if it’s time to sell.
Prepare as much as you can in advance and you could benefit from the stamp duty holiday when you buy your next home.
If you’re on the lookout for a home to buy, register with us and set up instant email alerts for homes that match what you’re looking for – and save and access your favourites all in one place.
You can also use our range of handy tools to find exactly what you’re after. Take our Advanced Search tool - it allows you to search for homes with specific features, such as 'thatched roof'.