Is it a buyer’s or a seller’s market? What is the outlook for UK property prices? Is now a good time to buy? As we’re increasingly asked for our professional opinion on the current market climate it is clear that buyers navigating the post-lockdown property market are being left confused by the conflicting being released by news outlets and are largely unsure of how to proceed.
At any given time there are a number of factors to consider when purchasing a property that will have a fundamental impact on whether it is a good time to buy a particular property and usually they are related to an individual’s unique position and motives for purchasing, above the condition of the property market.
Those looking for a bigger house with a garden, following a period of confinement, will likely be undeterred by any negative news report. This said, it’s always a good idea to have a handle on the overall state of the property market when looking for a new home.
Property market rebound
Since the property market reopened on 13th May 2020 there has been a sharp increase in activity from buyers seeking property to buy. Property portal Rightmove reported its busiest ever day on record in the weeks following the lift on restrictions though there is a clear lag in sales being agreed due to inactivity during the lockdown.
Zoopla has recently released data showing property sales are up 4% compared to pre-lockdown levels recorded in March, with sales activity being driven by a surge in buyer demand and low availability of housing to the market. The local markets that have seen the strongest rebounds in sales are in the Northern regions of the country and include Leeds and Manchester.
The report from the property portal also showed that annual house price growth in the UK sat at 2.4% in May, up from 1.6% at the beginning of the year. The strongest house price growth has been witnessed in Nottingham, Manchester and Leicester.
A recent Sentiment Survey by the Royal Institution of Chartered Surveyors (RICS) gauging the mood of selling agents showed an improvement in overall sentiment; there is positivity in the market place.
What does this mean for the future of the UK property market?
Most professionals are in agreement that rises in prices are likely to continue for the next few months before there is a plateau and perhaps a slight dip towards the end of the year before the market steadies.
Longer term forecasts from industry analysts for price growth over 5 or 10 year periods have largely remained the same as they were prior to the pandemic.
Is it a buyer’s or a seller’s market?
In a buyer’s market it is often the case that buyers can secure properties for below the asking price and there were initially many reports supporting such a situation upon the reopening of the property market in mid-May.
The reality is though that in many parts of the country the demand for property has increased dramatically and the supply of homes to the market has not met the high levels of interest resulting in less need for negotiation on asking prices and in some areas pushing prices upwards.
Whether the current market is currently in the buyers or sellers favour is entirely dependent on the location and property type; different parts of the country are seeing contrasting scenarios.
If you want to talk to an expert about a particular localised market our property finders have a deep knowledge of the areas they cover; contact us without obligation.
Is now a good time to buy a property?
As is often the case when asked this question we have to bounce it back to the client as the motivation for a property purchase is the key.
Lockdown left many realising their current home was simply not big enough for their needs, especially now that there has been a huge jump in the number of people expected to work from home rather than heading into the office.
Clients are now prioritising gardens, living space and a separate home office as their top requirements over other property features that might have previously been important, locations further afield are also being included in searches where it would have previously been important to live within a short commute of the office.
If you’re planning on owning a property for 5 or more years it’s important to buy with a long term view as by nature of the UK property market prices historically rise over time.
Of course you don’t want to buy a property at an over inflated price; conducting thorough due diligence on the property and collecting comparable evidence, details of what has sold nearby recently and the sale prices (not the advertised price) will all help ensure you pay a fair price.
Buying a property in 2020
Around 400,000 movers were said to have been left unable to progress with their plans to move following the country being placed into lockdown. Whilst estate agency shop fronts were closed and many in the industry put on furlough, transactions in the pipeline either simply paused or continued through to exchange with completion set for a distant date with the option to bring forward as possible.
Some renegotiation may have taken place on prices but the reality is that buyers still want to buy property and fulfil their plans to move so transactions have not seen widespread collapse.
Since the property market reopened in mid-May buyers have cautiously made appointments to view properties and for the most part viewings in person are only taking place following a virtual, online tour which the majority of agents now have available for each of their listings – this is expected to be the new normal.
Professional property finders
The UK property market in 2020 is seeing buyers with revised priorities and professionals finding their feet with new challenges. We can see already that there is a great deal of opportunity available to those who make well-informed purchasing decisions.