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UK Housing Market Forecast (2020/2021)
With such a fluctuating market and so many changes recently, those interested in development need to stay on top of what is going on in the property market.
Below, we have compiled a summary of some of the most prominent news stories in the South East from September to help you stay informed and up-to-date.
‘Micro boom’ for shared-ownership homes in London
When the market reopened in June post-lockdown, the demand for shared ownership homes rocketed by 167%, with many enthusiastic homeowners racing to get onto the London property ladder.
Shared ownership is a homeownership scheme that makes getting on the property ladder more accessible, especially for first-time buyers as it dramatically reduces the number of funds needed for a deposit.
According to the national shared ownership property portal Share to Buy, Enfield, Croydon and Sutton saw the highest number of enquiries.
Although there has been much controversy over how the pandemic will impact housing prices in the capital, new research from Hamptons International showed that there is a ‘micro boom’ in the capital – for which shared ownership has largely contributed.
Controversial plans for £3m East London ‘vertical village’ approved to go-ahead
The deputy mayor for London planning has recently approved for Thameside West, the 5,000 home Silvertown scheme previously deemed ‘overbearing, bulky and incongruous.’
Pipe has now said that the development will have a significant impact in improving London’s housing crisis, with ⅓ of the home prices being ring-fenced for first-time buyers and renters who could not afford to live in the area otherwise.
This news suggests that there is still a strong, growing market in London, otherwise, the plans for this would not have been approved.
Read the full story here.
Number of houses sold at the highest level since the pre-2007 financial crisis
The number of sales agreed upon per estate agent in the UK increased by 44% since July last year with an average number of 13 sales per estate agent for July.
This is the highest number since June 2007, according to NAEA.
The reason for the boom can be traced back to Rishi Sunak’s introduction of the 8 month stamp duty holiday which began on 8th July.
These discounts have encouraged those who were on the fence about buying property to take the leap and commit to the decision.
These figures are supported by Rightmove’s report of an impressive summer mini-boom of £37 billion in property sales from July-Aug 2020.
All of these figures show that despite the unpredictability of our current times, the housing market still appears to be pulling through.
Click here to read the full story.
The first Sukuk for the UK property market is launched by Bedford Row Capital
The approved Sukuk is for a fixed period of 3 years, coming to an end in September 2023.
It allows investors a 7% coupon paid out quarterly by Al Waseelah, a UK-based Sukuk, managed by London-based financial planning company
The benefit of Sukuk is providing investors with access to European assets and allowing them to diversify their funding base and access global capital markets.
Potential investors for the Sukuk are high net worth individuals and corporations, seeking asset security and yield in an unstable environment.
This is good news for property developers as it offers an additional choice for investors to find additional opportunities and shows that big moves are still being made in the UK property market.
Read the full story here.
Healthy buyer demand set to sustain UK housing market despite recession fears
Despite the continuing economic hit of the pandemic, the threat of recession and rising unemployment, the latest Zoopla housing price index shows that demand continues to remain higher than supply, and the trend is expected to remain later into 2020.
Zoopla says that supply flow is running 54% ahead of what it was this time last year, although the stock remains lower.
This means it is the perfect time for potential developers to get into the market, with a saturated field of buyers they will have a higher chance of being able to quickly sell the property and see quick returns on investment.
More people are looking to buy homes and spend extra money fixing their homes with services that can benefit their property.
Younger homebuyers are more likely to spend extra money on development projects so they can improve their home so it has an extra appeal.
Even if they are not thinking about reselling their home in the future, getting home development projects done will improve the quality of their house in terms of financial worth and the appearance of their home.