In for a smoother ride
DURING a year that has changed the world, Britain’s property market has endured a rollercoaster ride from the lows of lockdown to the highs of a stamp duty holiday scramble. But with less than three months remaining for sales to get over the line before the March 31 cut- off for land tax savings, what does 2021 hold for the housing market?
It’s a question that members of the Guild of Property Professionals have been mulling over for weeks, with many calling for the stamp duty holiday deadline to be extended to avoid a crash.
But with the completion of a Brexit trade deal with Europe, the ongoing appetite for moving to homes with more space because of Covid – and the hope of an economic revival following mass vaccination – there’s also a good deal of optimism for 2021.
Craig Reynolds, who owns Urban & Rural estate agency in Bedfordshire and Buckinghamshire, predicts a gradual cooling of the market as stamp duty incentives fade, but adds: “I expect a reasonable level of seasonal buyers to enter the market as usual, potentially buoyed by a Brexit deal.
“I expect lenders to respond favourably to the economic benefits of the vaccine roll- out and new incentives to be introduced to help first- time buyers – all factors which could stabilise the property market in our region for the foreseeable future.”
Nick Manson, owner of Mansons Property Consultants in Newcastle, expects a lull after March 31, but says: “I have a feeling that due to the high demand caused by the Covid log jam in 2020, it should bounce back quite sharply.”
In fact, the biggest problem facing both buyers and sellers is likely to be the continued need for high deposits.
LONG waits for mortgage approvals and delays in conveyancing are also increasing the time it takes to get a property to completion after agreeing a sale. “We are seeing this growing from 12 to 14 weeks and up to 18 to 20 weeks,” says Manson, adding: “Choosing an experienced conveyancer is vital and will ensure getting the property over the line.”
Ironically, last year’s upheaval brought benefits for people saving for deposits. This includes Binta and Mohammed Diallo, who were able to save their usual childcare fees while working from home.
The boost to their savings meant they could move from their rented two- bedroom apartment to a new three- bedroom house in Berkshire with their children Hassan, eight, and Khadija, three.
Binta and Mohammed, both bankers in their 30s, had fallen in love with the house at Bellway Homes’ Renaissance development in Reading earlier in the year, but did not have the deposit until lockdown.
“Saving for the deposit was proving hard but the sudden change, and not having to pay costly childcare, made the difference and we knew we could achieve our goal,” says Binta.
“What is even more extraordinary is that we are better off financially, too.
“The two- bedroom flat we rented was costing us £ 1,250 per calendar month and we are now paying just £ 1,000 for our mortgage.”
Their home is five minutes from Reading West train station and the development now has one, two and three- bedroom apartments for sale from £ 220,000 ( 0118 933 8020; bellway. co. uk) with only a five per cent deposit required through Help To Buy.
Although much of the UK is under strict tier restrictions again, most developers have virtual viewing systems and appointments for visiting sales centres.
But possibly the best prediction for property in 2021 is that prices are expected to remain stable, with no major increases or decreases and the prospect of a return to normal. Let’s hope the experts are correct.