'Boom and bust' house market fears

The housing market could be heading for a boom followed by a bust, according to feedback gathered by industry experts.

The Royal Institution of Chartered Surveyors (Rics) said evidence suggests that the temporary stamp duty holiday is playing a significant role in lifting demand currently.

The stamp duty threshold for homes has been temporarily raised to £500,000 – saving some buyers as much as £15,000 - but will return back to £125,000 from April.

Rics' July survey of property professionals found that the recent impetus seen in the housing market is not expected to continue as a range of government support measures are gradually phased out.

Rics chief economist Simon Rubinsohn said: "There remains rather more caution about the mediumterm outlook, with job losses and the end or tapering off of Government support measures for the sector expected to take their toll.

"Significantly, some contributors are now even referencing the possibility of a boom followed by a bust." A separate report from Halifax last week found that average UK house prices hit a new record high of £241,604 in July.

But last Wednesday, the scale of the economic fallout from the coronavirus crisis was thrown into sharp relief, as the Office for National Statistics (ONS) confirmed that the UK has nosedived into recession for the first time since the financial crisis.

It marked the second month in a row of buyer demand rebounding after the housing market was put on pause.