Svetlova LLP


July 15th, 2020

The housing market, as with the rest of the economy, has been hit hard by the coronavirus pandemic. The lockdown meant activity slowed sharply, with sales at half the levels of a year earlier.

Viewings, sales and moves have now resumed in much of the UK, but buyers and sellers face fresh unease about job and income prospects, prompting some to rethink plans over property.

The Nationwide, which bases its figures on its own mortgage lending, said that house prices, on an annual basis, dropped from a 1.8% rise in May to a 0.1% fall in June as the effects of the shutdown were felt. The typical home was now worth £216,403, it said.

This will be welcomed by first-time buyers hoping for a consistent fall in house prices, although restrictions by lenders mean mortgages have become more difficult to secure.

The prime markets of London have seen a significant recovery in activity levels since reopening on 13 May.

A surprising number of people are reassessing their housing needs and are now looking for a property that better meets their requirements.

Almost two-thirds of London agents reported that vendors’ price expectations of the property they are selling had reduced, while 85% said buyers’ budgets had decreased. This means the market remains price sensitive, despite an increase in activity and sellers need to remain realistic on their price expectations.

Across prime London, 97% of Savills agents reported an increase in demand for property with a garden or other outside space and 71% have seen more buyers looking to upsize, with many looking for a separate space to work from home. As a result, houses in outer prime London outperformed flats in the second quarter of 2020.