2021 Property Predictions

2020 has been an unprecedented year for the UK property market. Never before has the entire market been put ‘on pause’ the way it was between April and June of this year. Many were very concerned about what the property market would look like post-lockdown.

Since national lockdown measures have eased, the market seems to have been making a strong recovery. In many areas, prices have been rising and properties have been selling quickly, encouraged by government stamp duty measures. So, what does 2021 hold for the UK property market and what can you expect if you are hoping to move in the next year?

 

More online activity

With a greater number of people working from home in response to COVID-19, we can expect to see more of the buying and selling process taking place online. Online property viewings have become increasingly popular in recent months and conveyancing professionals are also having to get used to a new way of doing things.

Whether physical property viewings will happen in 2021 will depend on additional local and national lockdown periods. Whilst tier 3 guidelines do not explicitly ban in-person property viewings, it is assumed that many buyers, sellers and property professionals will decide that they are too risky in the most high alert areas.

Anticipated price correction

Government measures, such as the stamp duty changes and furlough scheme, have successfully averted the feared property market crash that many anticipated as a result of the virus, but there is a general consensus amongst property professionals that a price correction may well still be on its way when those measures stop. We, of course, will also have to contend with the end of the Brexit transition period in January 2021. With a no-deal Brexit looking increasingly inevitable, it is likely that we will experience an even tighter economic squeeze in 2021, which would undoubtedly have an impact on the property market.

If you are keen to move in the next year, it is really important to consider your personal circumstances. For some, the current stamp duty measures and the ‘unknown’ aspect of the next 12 months will mean moving before March 2021 feels like the best options. For others, it will feel wise to wait and see whether the anticipated market correction materialises.

Shortage of first-time buyers

Although Boris has announced a new range of 95% mortgages for first-time buyers, many would-be homeowners are struggling to secure a mortgage offer and are reporting an increase in down-valuing. This is bound to have a knock-on effect for market mobility generally and impact second- and third-time buyers over the next 12 months.

Danny Luke, managing director at home buying company Quick Move Now, gives us his top tips for a smooth move in 2021

Price competitively

If you are hoping to move to a new house in 2021, it’s important that you don’t get caught up in the property boom hype, and price your property according to local market conditions. Remember, asking price does not mean sold price, so seek advice from local property market experts about where you should position your property in order to attract proceedable buyers. Those who don’t price their market competitively from the start could find themselves sat on the market for longer than desirable.

Have your property looking its best

It doesn’t matter how challenging the market is, there are always people who will need to move. If your property is presented well and priced correctly, you will find a buyer. In a challenging market, competition will be tough, so keep your eye on what else is on the market and make sure your property is presented ready to sell.

Get mortgage in principle lined up before putting in an offer

In tricky economic times, it is important that you get a mortgage in principle before making an offer on a property. Many would-be buyers will assume they can borrow more than a mortgage provider will be willing to lend. In the last few months, we’ve seen a significant number of properties go under offer and then become available again because buyers simply can’t get the mortgage finance that they had assumed they could.

Sell before making an offer

It may seem counter-intuitive to hold off from looking for your next property before your current home is sold, but in the current climate it is the only option for many people looking to move. Many sellers are only taking viewings or entertaining offers from those who have already accepted an offer on their own property. This is to ensure they don’t fall foul of time wasters who are going to be unable to see the purchase through to completion.

Of course, there are benefits to the buyer in proceeding in this way. Not only will you have a clear idea of how much you can afford for your next property, it will also significantly increase your bargaining power if you’re in a position to proceed quickly.

If you’ve found your next property and are keen to move quickly, consider alternative ways of selling

In the first quarter of next year we expect to see people rushing to get their house sale/purchase completed before the 31st March stamp duty deadline, so competition for desirable properties will be strong.

If you’ve found your next property, but are struggling to sell you existing home, you may want to consider quicker methods of sale. Property auctions and genuine cash home buying companies offer an alternative to the open market that could offer more flexibility to help you secure that dream home.

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