In the second half of 2020, when the market was crazily busy, everyone in the property industry made hay while they could, uncertain of how long this activity would last. However, since then the Brexit deal has been secured, vaccinations have been approved and are being rolled out at pace. We are in a totally different, and more confident, space than we were a couple of months ago.
There will, of course, be pinch points. There will be further delays and setbacks with Covid, and the property market will continue to experience capacity restrictions, particularly as we approach the stamp duty deadline – but I’m positive about the outlook for this year and that the growth will be sustainable into the future.
There are even signs that the end to the stamp duty window won’t provide the cliff edge to the market that many have feared. I’m already hearing of a secondary market of buyers who are waiting until April as they think they will be able to get a good deal in a less competitive environment or pick up a property at an attractive price where the transaction has fallen through.
There will also be new opportunities that come with Brexit. As teething issues around trading with Europe are ironed out, we will sign new deals with new countries. This will create jobs and people from new geographies will want to come to Britain to live, work and buy homes.
Aside from this, we have seen an important shift in people’s attitude to buying a home and many are no longer holding off making life decisions based on external economic events, or even their place of work. Covid has been a wake-up call in that people have realised they can work, and trust their teams to work, remotely and the trend for people to move away from city centres to more rural locations has been well documented. But there could well be a trend for some to move in the opposite direction. Some people will want to move to larger conurbations in search of new opportunities and whereas small flats and studios are currently out of favour, when offices do start to reopen, there could be renewed interest in these properties to provide a ‘crash-pad’ for people with rural homes.
I’m expecting to be busy this year – we’re recruiting and growing as a business – and there is every indication that this growth will be sustainable. After all, we’ve been living in an environment of depressed property transaction numbers for a few years. The global financial crash pulled the rug from under the market, and just as it began to recover, Brexit made people cautious again.
Now that there has been a mindset shift that people are not going to put their life on pause because of the political or economic environment, we could return to a more liquid property market, with more transactions driven by people making decisions based on their lives rather than the headlines.
According to government statistics, the number of property transactions (with a value of more than £40,000) in November 2020 was 103,690. This is the first time the number has broken through 100,000 since March 2016, which was of course before the Brexit referendum.
For brokers this is clearly good news, but there is also a word of caution. As lenders have become more comfortable with AVMs, they are increasingly de-coupling the valuation from any property inspection and many no longer offer the option of a survey. This might help a case to progress more quickly, but it could also leave your clients exposed if it later emerges there are problems with a property that a survey would have picked up.
So, make sure that you discuss the options with them and ideally make this part of your documented processes. It could protect your clients from taking on unwanted costs and protect your business from unwanted claims. It could also provide you an additional revenue stream, boosting 2021 income.