Will Leyland, 18 June 2020
It has to be said that when we’re finally able to look back and take stock of what happened this year, which isn’t likely to happen until next year, we’ll probably be able to say that it was one of the weirdest and most unpredictable recessions in history.
It’s not an understatement to say that what’s happening this year, the events we’re living through, will probably be the most significant of the early century and perhaps the most baffling and life-changing since the post-war era.
Thinking more specifically, however, we can start to make some predictions and plan for the next few months with the information we have available. That can give us an indication, if not a bullet proof assessment, of what the new normal may look like for estate agents, tenants, landlords and the wider property market.
As with any uncertainty, economic or other, there will be the worst-case scenario predictions and those that are overly optimistic, and the most sensible place to be is probably somewhere in the middle of that. Planning for the worst but hoping for the best.
Now that we’ve passed the six month mark since the start of this epidemic, the information available is much more comprehensive, and certainly since estate agents and the wider property market were able to re-open following the lifting of government restrictions, we’re now getting access to good quality data.
One of the surprising but simultaneously logical side effects of families being stuck in lockdown for a prolonged period is that many are now seeing gardens with their properties as an essential, especially those with young children.
A monthly survey of surveyors and estate agents from the Royal Institution of Chartered Surveyors (Rics) published in The Guardian noted that “The vast majority of surveyors and estate agents (81%) say homes with gardens or balconies will be in demand over the next two years, along with houses near green spaces, and 68% reckon that properties with greater private and less communal space will become more desirable.”
Sentiment across the market remains positive with many agents reporting extremely busy periods but with a degree of uncertainty. There is still a great deal of concern for some over which industries, and subsequently which jobs, are safe from the current economic shock taking place.
This has caused some changes to processes and procedures as background and affordability checks are run, and things are starting to have to shift to take account of this.
There is also good news for the other side of the market, with Zoopla reporting that property sales have swiftly rebounded to pre-lockdown levels with buyers and sellers keen to complete on properties that were pre-agreed. Furthermore, there are lots of people that may have been unsure pre-lockdown of entering the market that have now had their mind up having spent a long period of time stuck indoors.
“Lower asking prices for homes sold over the lockdown period may drag down indices over May, but this new data suggests house price growth is set to remain positive in the next two months,” said Zoopla research director, Richard Donnell.
With prices and demand staying stable, there’s little indication that the market will wobble significantly in the coming months. In the Private Rented Sector (PRS) there’s actually a feeling amongst insiders that demand has now far outstripped supply following lockdown and that it may even surge further, meaning a very positive outlook for the rest of the year.
Will Leyland, 18 June 2020