I've been asked on a few occasions now for my opinion on what the impact the latest lockdown will have on #Skelmersdale house prices.
That's a hard one to answer because any fluctuation in house prices is, more often than not, linked to the general economy, which in turn is linked to the general feeling about employment security and prospects.
And to say there are mixed feelings on that subject is an understatement. On the one hand, we have what happened after the first lockdown, in that buyers' desire to buy didn't change, and once the property market was released, there was surge in enquiries from buyers, and properties were snapped up quickly. Now normally, when demand outstrips supply like that, prices increase, and whilst we simply can't see the rate of increase being like the one we saw in the late 90s and early 2000s - salaries wouldn't keep up with house prices for a start - there is a sound argument for prices continuing their upward trajectory, no matter how slight. The other argument is related to jobs, and whether job losses will become more common once the economic reality of the pandemic hits. We have an inkling that the money spent on the furlough scheme and business interruption grants, amongst other things, will result in tax increases, but we simply don't know what form these will take, and whether they will be primarily aimed at individuals or, more likely, businesses. Either way, I presume this will be influenced by how quickly the government needs to pay back any borrowing they've made in order to make the above happen. The hope of course is that the economy bounces back enough so that job losses can be contained. If this happens, house demand should continue unabated, and prices will remain at least stable.
If job losses do reach a certain level, however, then it stands to reason that having fewer buyers in the market, and a general lack of confidence, or nervousness, in the economy would cause house prices to stagnate, or fall slightly.
So, back to my opinion. Will house prices fall? Personally, I doubt it, and even if we do see a lull in activity, then it is highly unlikely to be like the 2008 crash, as the banks aren't - as far as we know - in trouble, or freezing all lending. Will they increase? That all depends on the level of activity. If activity levels are like they were from June - December last year, and this is sustained, then yes, they will go up eventually.