Lockdown savings push UK house price growth boom
The UK and US housing markets have surged past other economies’ thanks to buyers being able to amass savings in lockdown.
Prices increased by 9.4 per cent on average across the 56 countries and territories tracked by the index, according to Knight Frank’s global house prices index.
The majority (96 per cent) of the 56 markets tracked registered positive price growth year-on-year, while developing countries struggled to keep up.
Turkey led the way in nominal terms while South Korea led in real terms.
The UK ranked at 21 out of 56 markets, registering 11.8 per cent nominal annual growth and 8 per cent in real terms, adjusted for inflation.
Kate Everett-Allen, Knight Frank’s head of international residential research, said: “What we’ve noticed throughout the pandemic is advanced economies have had house price boom. It is largely confined to advanced nations which have put in huge amounts of fiscal stimulus to support people in the crisis.”
In markets including Sweden, the US and the UK, homeowners have amassed “significant savings” during lockdowns after not being able to go on holiday, holding off on purchasing pricey items and staying in more.
The market has also been impacted by households seeking a “change of lifestyle,” with the pandemic causing them to reassess their housing needs including needing to be “less tethered to the office than before,” Everett-Allen added.
In other markets, including Switzerland and France, there has been a growing demand for second homes.
People have been keen to snap up properties in the Swiss and French Alps to pursue “mountain living and resort lifestyles” for a few months of the year.