Lockdown and its impact on the property market
- Credit: Archant
James Lamb, from Savills Loughton, looks at how buyers and sellers have reassessed what’s important in light of their lockdown experiences
Spending more time at home away from friends and family has led many of us to re-evaluate what’s important in life. From how we socialise and what we eat through to where we work and how we relax, it’s understandable that people’s priorities have changed in light of recent experiences.
It’s certainly made people think more about the space they live in, the attributes they most value in a home and, in some cases, where they want to live. A recent survey carried out by Savills among 700 of our clients indicates that moving intentions, budget, size of property and location have all been impacted.
In the 12 months up to the end of March this year, 40 per cent of people who bought a property through our Loughton office came from London – with 88 per cent of those continuing to commute. But the experience of working from home, avoiding daily travel, is expected to drive even greater interest in more ‘rural’ locations, with good towns and villages that have plenty of surrounding green space and easy access to key cities likely to be top of people’s shopping lists.
Versatile living space and access to the countryside has become a prerequisite for those anticipating increased home working, particularly those with children. As a result well-connected locations such as Woodford, Loughton and Epping – with the likes of Epping Forest and Connaught Water right on the doorstep and well placed for the Central tube line for when trips to the office are essential – will likely be in high demand.
The potential for a ‘rural renaissance’ also comes at a time when country property looks increasingly good value when compared to prime houses and flats in some of our most desirable towns and cities. According to our survey, almost half (49 per cent) said they will be more inclined to work from home even after restrictions are lifted. As a consequence, 44 per cent of respondents said a separate work space has assumed greater importance, rising to 61 per cent amongst the under 40s, with good access to Wi-Fi also becoming more valued. Some 39 per cent of respondents under 50 stated an increased inclination to upsize, rising to 42 per cent among the under 40s. The desire for a garden or outdoor space has also become a more pressing consideration for 71 per cent of this age group. At the other end of the property ladder, there appears to be a growing commitment to downsizing among wealthy older households, albeit this trend (20 per cent of respondents) is less pronounced than the desire for more space amongst younger prospective home movers. Around four in 10 would now find a village location more appealing than previously, while 54 per cent of those with school age children now find the idea of a countryside location more attractive than pre-Covid-19.
Turning our attention to the wider market – and in line with earlier predictions – the survey pointed to a slowdown in activity in the short term, with a recovery later this year and into 2021. Just under half of respondents did not expect the selling price of their existing home, nor the amount they would be willing to spend on a new property, to have changed as a result of Covid-19. The other half felt both would fall, the majority by up to 10 per cent. However 20 per cent of respondents felt that their budget to buy a new home might fall by more than this figure. Only 5 per cent of respondents believe the value of their home could have risen.
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This suggests there is likely to be some downward pressure on pricing in the short term, coupled with a period of much lower activity. Reassuringly, the survey suggests that buyers and sellers broadly agree on how they believe the lockdown has impacted values, and this alignment should help underpin the recovery as we come out of lockdown and buyer caution begins to lift.
Savills Loughton, The Triangle, 1A Smart’s Lane, Loughton IG10 4BU; 020 8498 6605; firstname.lastname@example.org