How is the property market bouncing back?

There’s no question it’s been a tough start to the year, not just for individuals but also for businesses and specific industries that simply need customer interaction to simply work.

Now as we head into the second half of 2020 and businesses begin to receive the green light to open their doors, we’re looking at how this is impacting the housing market.

Physical over virtual house viewings

Naturally over the course of the lockdown, many services and experiences were transferred to a virtual environment. This won’t work with everyone and especially when it comes to purchasing a house, its’ been clear that has house viewings begin to start up again, more people still want physical house viewings over virtual.

That’s not to say that virtual viewings are a bad thing, in some cases it has given property buyers the opportunity to view lots of properties, more than they would normally be able to view if they were booking house viewings the traditional way.

Perhaps physical and virtual viewings will only improve a buyers search as they can opt to first view a house they like the look of virtually but then arrange a physical viewing to get a better feel for a property.

Buyers have had time to research

Sometimes it feels as though there is never enough time to really sink your teeth into the housing market and as a buyer there may be moments when you don’t feel prepared enough.

Lockdown however seems to have given buyers a much-needed extension in order to understand the market, the areas they want to live in and the value of properties, as some estate agents have experienced a huge increase in registered buyers looking to get their search on the move.

Zoopla research showed that once the housing market had opened up again from the 13th of March there was a huge surge of demand in sales, simply proving that people have not been put off by the pandemic.

The same research also demonstrated an interesting view that due to the Covid-19 lockdown, households have realised the need to space, bigger gardens and inside space. A demand for property away from city centres has also seen an upward trend as buyers look for more rural locations.

House Prices

With the housing market essentially being closed for several months, the demand to move will have been extremely low and so you would think house prices would alter because of this. According to Nationwide, house prices actually rose 0.7% in April, however up to 80% of these sales were completed before the lockdown.

Property price forecasts by Knight Frank, predict that UK house prices will actually fall by 3%. As there’s only information up to March in the UK House Price Index, it’s difficult at this moment to understand exactly how house prices have been affected by Coronavirus, however it’s easy to assume house prices would fall in order to create the rising demand.

Because of the slow rise in demand for properties, it might give house buyers the confidence to put in an offer below the asking price. On average, house buyers were able to knock-off around £10,000 the asking price, but could this number go higher due to Covid-19?

Buy-to-Let also staying strong

It’s not just house buyers who have been affected by Covid-19, landlords have also felt the sting of the industries own lockdown but many are hopeful that the buy-to-let market will also improve.

Manchester’s buy-to-let market, for instance, doesn’t appear to have shifted too much, with many firms still predicting a record growth of 4.1% in Manchester house prices and when comparing this to the UK’s average of 2.9%, landlords clearly still have an opportunity to invest and yield good returns.

Mark Burns is the managing director of Manchester-based estate agents Indlu. 

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