Will Leyland, 24 July 2020
Despite it being an extremely tough time personally and professionally for a lot of people, it’s been something of a realignment for many in the property industry where both the importance and contribution of the sector towards the wider economy have become clearer.
With the chancellor’s announcement in the summer statement being somewhat focused around the property marked, it cannot be underestimated how much the government consider the property market key to the economic recovery they’re planning.
Further to that, many tenants and homeowners have begun to realise where their priorities lie when it comes to their living arrangements. Where city living was perhaps once perfectly OK in a small apartment without much room or outdoor space, the lockdown and pandemic have now highlighted to people how important their living space now is.
Indeed, there’s been lots of anecdotal reporting of a huge surge in demand for properties with gardens, for example. There is now a huge amount of demand in the market even if prices remain a little volatile.
It highlights what we will probably come to think of as the “new normal”, with people forced to spend much more time indoors as we move back to life pre-COVID, but in reality normal will probably never really return as we know it. Offices are preparing to have at least some of their workforce remain working from home for the foreseeable, and many businesses are now coming to realise that they don’t need to be paying for expensive office space when people are just as productive from home.
The key to being productive and happy whilst working at home, however, is to have a home with the facilities to be able move around, exercise, and find space quiet enough to work in, and that’s often not the case.
As reported by The Guardian, “It found that private rental prices paid by tenants in England rose by 1.5% in the 12 months to June 2020, unchanged since April 2020. Rents in Wales were up 1.4%, and in Scotland by 0.6%. The ONS data captures annual rent increases for existing tenants and are regarded as the most reliable snapshot of the rental market.”
This is indicative of a market that hasn’t slacked since re-opening and shows a huge growth in demand across the country although, of course, demand will vary across regions, cities and towns.
Supply doesn’t appear to be able to keep up with the demand, and anecdotal evidence from agents across the country is that demand for Private Rented Sector (PRS) is rising quickly. Furthermore, Rightmove reported record demand in the weeks following the lifting of restrictions on house viewings and agents.
It would seem that demand will continue to increase both in sales, purchases and tenancies throughout the year as more and more people prepare to spend more time at home, and so prices and rents will logically continue to rise, although this may be slower than normal.
If anything, now would appear to be the time to take the plunge on your property plans before things rise any further.
Will Leyland, 24 July 2020