According to the Principality, house prices in Wales have risen despite the pandemic. Although there are fears over jobs and the economy, people have continued buying new homes.
The building society state the reason for this is because working from home is becoming the “new normal” so people are looking for bigger homes with more space.
According to Zoopla’s house price index these rises are set to continue into 2021. Predicting sale values to increase by 2% in Wales, compared to 1% across England.
The Principality’s chief risk officer Mike Jones believes that the furlough extension and schemes such as mortgage deferrals should keep the sector afloat, and will help first time buyers to “put a first step on the ladder” in this current climate.
“It is also potentially the desire for a lifestyle change for some who, during lockdown, have realised that it is possible to work from home, avoiding the necessity to travel to work on a daily basis,” he added.
“The demand for larger homes with additional space, including outdoor areas, has consequently risen however, and with little new supply coming to the market, prices also rose rapidly.”
Areas such as Abersoch in Gwynedd saw house prices jump.
How has Covid-19 affected house prices?
House prices rose by 3% across Wales’ local authority areas to £196,165 after Wales’ first lockdown ended in June.
In September, six local authority areas reached a new record average price – Bridgend (£190,948), Cardiff (£247,030), Carmarthenshire (£172,708), Gwynedd (£198,279), Newport (£213,660) and Powys (£222,992).
Apart from Cardiff, they are all among the council areas with the highest proportion of detached or semi-detached homes, indicating to the Principality the rise is being driven by people looking for spacious homes suited to lockdown living.
Gwynedd had the highest increase; houses rose by 14.6%, where the price of an average detached home rose from £250,000 to £280,000.
Mr Jones added: “Covid is likely to have dented consumer confidence and fears over job security may mean that many prospective buyers will be reluctant to either put a first foot on the housing ladder, or indeed take a step up.”