The Covid-10 pandemic has made the future of the UK real estate market practically unknown. Property viewings almost came to a halt, people who were in the middle of moving houses stopped the process, and real estate agents were sitting almost idle during the beginning of this pandemic. Of course, over time and with a significant push from the government, the real estate market seemed to bounce back. Estate agents in Beckenham were back at it, real estate agents in Leeds were showing houses virtually, and the real estate market started to pick up. Now, the big question at hand is, what can buys and renters expect from the property market post-Covid-19?
Introduction of stamp duty holiday has worked as expected
In the early days, no one was too sure on how Covid-19 would impact the economy. However, after Chancellor Rishi Sunak announced the stamp duty holiday which removed stamp duty for properties under £500,000 and reduced the percentage of stamp duty for properties between £500,001 and £1.5 million, there has been a distinct increase in the number of people looking at real estate and buying real estate in the UK. Stamp duty holiday allowed potential buyers to purchase their new home at affordable rates which lead to a distinct increase in the sale of real estate within the first few weeks of the announcement! In the long run, the prices of these properties will rise with the stamp duty holiday ending in March 2021, which means that this move was beneficial to those who purchased property with the exemption of stamp duty.
Buyers and renters can increase their budgets
Both buyers and renters will be able to increase their budgets because of Covid-19. Buyers will be able to buy bigger and better houses with their fixed budget thanks to the introduction of stamp duty holiday. Renters will be able to move into bigger places and upgrade their living situation because tenants are no longer asking for such high rentals. Also, buyers will have more choice as the supply of rental housing is rising since homeowners are looking to earn some extra money during these uncertain times through rental incomes.
Prime property has become more affordable
Prime property has hit that sweet spot, where it is affordable and within budget. Earlier on, potential buyers with a smaller budget might not even be able to consider prime properties. Still, thanks to the stamp duty holiday, these very buyers can now buy prime property at affordable prices. Of course, given that these properties are in prime locations, it is expected that the cost of real estate in that area will continue to rise in the future. That means buying these exceptional properties is a significant short-term or long-term investment as the homeowners can sell these properties for a substantial profit margin in the future.
The suburbs are the future of the real estate market
For buyers, or renters, who are looking to move into better homes, the suburbs are the future. More and more people are choosing to move to the suburbs; this could be because of lower average property prices, bigger homes, better homes in smaller budgets or for more space. However, if you’re thinking about moving into a new rental property or moving houses, consider looking at real estate in the suburbs. Post Covid-19, it is expected that the average price of property in the suburbs will increase due to the increase in demand and consistent supply. If you’re thinking about buying property for a short-term investment, or even a long-term one, then buying a property in the suburbs of the UK is highly recommended, especially during the pandemic. Of course, it is essential to do your research and buy the right property in the right area to ensure maximum benefits in the future.
Low-interest rates mean significant savings
While banks have become very particular about specific criteria that potential buyers need to fulfil to get pre-approved, there has also been a slight decrease in the interest rates. Low-interest rates, coupled with stamp duty holiday, means that buyers can save vast amounts of money while buying their new home. In the long run, these savings will ensure that an investment made during the Covid-19 pandemic was a fruitful one indeed!
In the long run, post the Covid-19 pandemic, it is personal income and the state of the economy that will decide the future of the real estate market. However, experts are predicting that the real estate market of the UK will be able to tackle this slight road bump and come out stronger. Nonetheless, an investment in times of Covid-19 involves stamp duty holiday, low-interest rates and a massive supply of housing; essentially, this ensures that your new home is affordable and well-priced