- 31st December 2020
- Posted by: DMM
- Category: Property Market Reports
It seems that we are going to end the year with good news of an amazing British accomplishment with the Oxford AstraZeneca vaccine having been approved! This vaccine could not come too soon and now gives hope that we may yet return to the ‘old normal’ by the middle of next year. This is literally the ‘shot in the arm’ that the country needed and comes hot on the heels of a Brexit deal having been achieved.
This past year has certainly been a tumultuous one with January 2020 feeling the benefit of the ‘Boris bounce’ and then, just a few weeks later, the worrying news coming out of China, then Europe and with Covid-19 then hitting our shores by the beginning of March. This frightening pandemic shocked everyone and forced us into the first lockdown. I am sure this is a period in our lives that we will not forget quickly.
Naturally for everyone the priority was staying safe, protecting our families and the people around us. For those of us in the property industry we had to sit back and watch the market put on hold. Whilst construction work could continue, scarcity of some materials started to cause delays.
But then, as the property market was released, we saw the impressive upward bounce in activity as those for whom their purchase has been paused, just got on with and bought anyway. Estate agents across the country reported to us that few people were taking fright and withdrawing from their acquisition. Add to these the frustrated wanna-be home movers now being released to pursue a new home and the dip in house sales became a ‘V’ shaped bounce back.
With the government raising the stamp duty bar to £500,000 until 31 March 2021, continuing low interest rates and a new desire to move to a home with a garden; and you have booming property market. Who’d have thought that in April?
If you have been following our blog posts on property prices then you will have seen the steady upward pressure on asking prices which, whilst tempering a little in recent weeks, continues upward. In December, the Nationwide Building Society reported that property prices increased by 7.3%, up from 6.5% in November. The fear for many of us in the property world is what will happen next year following the end of the stamp duty holiday, an end to the Help to Buy scheme as we know it, an end to the Furlough scheme and, therefore, a spike in unemployment? I have to say that a no-deal Brexit was also in that mix until Boris pulled that one out of the hat!
Nevertheless, we do have a Brexit deal, we do have a vaccine to be rolled out and the cost of home ownership has never been cheaper. Consequently, we remain confident of seeing a resilient property market this coming year and, perhaps, a greater confidence from property development lenders as the year progresses. The volatility of the market, and looming threats to it, having caused some lenders to pause lending altogether whilst others have tightened their criteria. However, there has been an encouraging core of UK property development lenders that have continued to fund.
Consequently, we enter the New Year with an upbeat expectation for future business, whilst with much of the country now in Tier 4 we should not forget that we are not yet ‘out of the woods’. The health and safety of all those around us should remain our first concern and we should not lose sight of the still deadly virus. Our thoughts go out to those that have lost loved ones this year and our thanks to all those brave people that help protect us.
We wish you all a safe and Happy New Year!!