Uk Property Market Outlook: What Buyers and Renters can Expect from the Property Market Post COVID-19
Covid-19 changed the world as we know it. Economies suffered, property markets hit rock bottom, the aviation industry was in turmoil and the hospitality industry came to a standstill; almost every industry was impacted by the effects of Covid-19. As researchers attempt to find the best cure and scientists work towards creating a vaccine, there is still a high level of uncertainty when it comes to Covid-19. While no one can predict the future, everyone is waiting with bated breaths to know what the future holds, especially buyers and renters who are looking for new places to stay and moving into new homes. From estate agents in Orpington to estate agents in Leeds, as well as real estate agents all over the UK, we spoke to them all; and this is what the experts have to say about what buyers and renters can expect from the UK housing market post the Covid-19 pandemic.
Prices will be stable and resilient
During the summer of 2020, we saw an unexpected increase in the sale of houses. Most properties were sold for the asking price or higher. Of course, this has a lot to do with the fact that some sellers were making distress sales while some buyers were more than willing to make the most of the slight decrease in real estate prices. In 2021, it is expected that the price of real estate might soften for a while, but then the real estate market will pick up and become somewhat stable. The market will be resilient and the prices will be stable, probably due to a balance in demand and supply of real estate.
Stamp duty holiday will most likely be extended
The Chancellor of the Exchequer announced a stamp duty holiday that was supposed to last until March 2021. Stamp duty holiday meant that the rate of stamp duty was cut to zero per cent for all properties that were valued under £500,000 while the stamp duty was reduced for properties valued over £500,000. Given that the stamp duty holiday scheme worked wonders, as expected, it is predicted that the UK government might extend this temporary holiday on stamp duty. This means potential buyers will be able to buy real estate at lower rates while investors will be able to snag prime properties at lower values!
Suburbs will become popular hotspots
The ongoing trend seems to point towards the fact that many homeowners are interested in shifting into the suburbs. With more and more people working from home, homeowners are now interested in upgrading their homes and their lifestyles. They want to shift to homes with lush green gardens, more bedrooms and home offices so that they can work from home in comfort. Since such spacious houses are easily available in the suburbs, and of course, the price of such properties in the suburbs is much lower when compared to similar properties in city centres, it is understandable that suburbs will become the new property hotspots.
A significant increase in let-to-let
Let to let means when a homeowner gives out their property on rent and moves into a bigger or better property as a tenant. Since most homeowners are looking to upsize, it makes sense to put their home on rent and find a bigger and better place where they can stay on rent. This allows homeowners to upsize immediately, without the hassle of buying a property, applying for pre-approval, repaying the mortgage and so on. Originally, let to let became rather popular after the financial crash of 2008 and it seems that the residents of the UK are embracing the let to let concept once again.
Increase in buy to let properties
With more and more people wanting to upsize, move to the suburbs and upgrade their homes, there will be a significant increase in buy to let properties in the near future. With the uncertainty of the future, as well as the uncertainty around the economy and the job market, most investors feel that investing in property is the safest place to park their investments. By investing in buy to let properties, investors will be able to ensure a steady supply of monthly income which is a huge benefit in these uncertain times.
Of course, there is no certainty about what the future holds. Some experts feel that the price of property might decline by 2 to 5 per cent in 2021, some feel that the average price of property will rise in the coming year while others feel that the property market will be stable post the Covid-19 pandemic. While there is no foolproof way to predict the future, it is always good to be well-prepared. Before investing in any new property or taking up a new place on rent, understand the market, do your research, weigh the pros and cons and then take a well-thought-out decision about what your next move should be.