Rightmove and Zoopla might have recorded record levels of interest in the wake of the property market re-opening. However, Phil Spencer predicts that house prices will go down over the next year.
Related: House prices see the largest drop since 2009 reveals Nationwide
Speaking to Hello Magazine, the property expert revealed what we can expect from the property market in the wake of coronavirus. When asked whether house prices will go down over the next year he explained that things are going to get a lot worse before they get better.
Phil Spencer's house price prediction
The answer depends on how long the restrictions remain and how deep the damage to the economy turns out to be,' the Location, Location, Location presenter told Hello. 'But what we can't factor in with the housing market is that so much of it is driven by sentiment and how people feel.'
'So if they feel uncomfortable or nervous about the economy or their job – it will translate into not much happening in the housing market,' he explains. 'People won't feel like borrowing extra money.'
'But house prices are not going up – that much is absolutely certain! It depends on consumer confidence and how long it takes to come back.'
'My personal prediction (and I'm not an economist), would be about minus five per cent straight away. And minus about 12 per cent in a year's time,' he adds. 'I think it'll get worse.'
Phil Spencer's house price prediction is sobering. Especially, after the latest figures from Rightmove and Zoopla demonstrated an increased homebuyer interest.
The increase in demand had many optimistic of a rapid bounce back to the strength of the pre-lockdown market. However, even Zoopla has approached the rebound in demand with caution.
'COVID crisis and 50 days lockdown has created an unexpected one-off boost to housing demand,' explains Richard Donnell, director of research and insight of Zoopla. 'Many households are likely to have re-evaluated what they want from their home. This could well explain the scale of the demand returning to the market.'
'However, we expect the latest rebound in demand to moderate in the coming weeks as buyers and sellers start to exert great caution,' he adds.
Despite the challenges facing the property market at the moment, if you are determined to move at this time Phil Spencer has some final words of wisdom:
Related: Phil Spencer has some reassuring property advice for dealing with Coronavirus that you need to hear
'If you're going to move, then crack on - or sit it out!'
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