What Next For The Property Market
With various UK lenders quoted in the last few weeks that house prices grew between 6% and 7.5% in 2020, either being the largest growth rate for six years, it is unsurprising that attention now turns to what is in store for 2021.
Early 2020 saw slow growth in the housing market with a few predicting that a downturn was perhaps on the way, of course, the interruption to the norm that is Covid-19 brought much of the economy to a halt at the end of March. The property market paused until mid-May reopening with a fervor not seen since the boom periods in the 80s and 90s and agents who had been largely forced to sit on their hands for a few months where suddenly scrabbling to keep up as both the sales and lettings markets saw demand significantly outstripping supply.
Whether such activity was fuelled by a Covid-19 induced desire to make lifestyle changes or from the introduction of economic stimulus such as the Stamp Duty Holiday depends on which expert or agent you listen and within George F. White we found both buyers and sellers mentioning both to different degrees.
Whilst for some the Government support packages did not go far enough for many the furlough and Self Employment Income Support schemes provided enough economic reassurance to keep some if not all the wheels turning. Financial lenders who initially withdrew many products from the market showed confidence by reintroducing more and more options as the year progressed all of which combined into cautious confidence in the property market that saw it end the year better than could have been predicted.
For 2021 the property market looks to match the wider economy, this article is written during some of the toughest restrictions since the initial lockdown in March 2020, and with increasing media chatter about the pending introduction of even tougher measures, it will be interesting to see, if they are introduced, their impact on the property market and indeed the wider economy.
Melissa Lines, Senior Associate at George F. White, commented “I believe that the first few months of 2021 will see a strong start to the year but that we will see the market plateau in April, beyond that it is quite difficult to accurately predict things but I don’t see a significant downturn at this time”
Echoing that sentiment, Alison Kent from our Yorkshire team added “there was a huge pent up demand for property that was released in May and as yet I haven’t seen supply rise to match that for both sales or lettings and it’s my belief that so long as that imbalance exists then the property market will do well during 2021 even if it does level out somewhat in the latter half of the year”.
With a dearth of buyers out there competing for a limited supply the market is active and that is clearly driving the current growth in property value but it is here that caution is urged “there were properties coming to the market before Christmas with what I felt were strong prices and they still remain on the market, my advice to our clients is to be realistic and you will be in a stronger position to be successful” says Gemma Miller, Residential Sales Manager in Northumberland.
Across all our regions we have seen sensibly priced properties selling quickly and at the full price but what buyers and sellers need to be aware is that for most the time taken for the conveyancing process has increased during the pandemic. Where we would often be confident that a typical sale would conclude within three months it is not unrealistic for many to now be taking five to six months as delays in acquiring searches and liaison between legal teams increase.
Eyes will now be on the wider economy as the country watches as to how it will fare in the current climate and also towards the Government in regards to both restrictions and stimulus in the coming weeks and months as all will have an impact on business and consumer confidence which will ultimately dictate the path that the property market will take.
To talk to our teams about buying, selling, or renting a property please call us on 0333 920 2220.
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