The Building Societies Association says there’s been a surge in consumer confidence in the housing market following the Budget.
Some 37 per cent of respondents to the BSA’s property tracker agree now is a good time to buy, compared to 27 per cent in December; just 17 per cent say disagree, down from 23 per cent in December.
There is also growing expectation that house prices will rise, with almost four in 10 people anticipating an increase over the next 12 months, a big jump from 25 per cent three months ago.
The Chancellor’s Budget announcements earlier this month appear to have stimulated confidence with 59 per cent of first-time buyers saying the mortgage guarantee scheme - which requires a five per cent deposit - has made them feel more positive.
The extension to the stamp duty holiday has also led 40 per cent of people feeling more positive about buying, with the furlough extension building confidence for a third of people.
In the midst of the Covid pandemic, lack of job security has been perceived as the biggest barrier to buying property and it remains so at 59 per cent; however it is steadily declining as a reason for not purchasing.
Optimism differs by region - in Wales, for example, almost half of respondents expect house prices to rise in the next 12 months, compared to just a third in London and the East Midlands.
Lack of job security as a barrier to buying a property at 59 per cent belies a north-south divide with 65 per cent in Yorkshire and Humberside citing this as a barrier, compared to just half of those in London.
“The extension to the furlough scheme has also stimulated confidence and it’s good to see that many people are no longer citing losing their jobs as a barrier to purchasing a home. We should however be mindful that the full impact the Covid-19 pandemic will have on the economy is still unclear and there’s strong evidence that the effect on household finances varies considerably, with those on lower incomes most negatively impacted” explains Paul Broadhead of the BSA.
“With the latest forecast from the Office for Budget Responsibility suggesting the unemployment rate will reach 6.5 per cent this year, and many people still benefiting from mortgage payment deferrals, the overall figures may conceal those who are struggling financially and are feeling less optimistic about the future.”