The last couple of years have been an interesting time for the UK’s prime property market. From shifts in lifestyles as a result of the pandemic, a reduction in remote working, as well as key changes, such as the end of the Stamp Duty holiday, there have been a lot of influences at play. Whether you’re a buyer or a seller in prime property, there are plenty of challenges ahead – and plenty of opportunities too in terms of where the market is likely to go next.
- It’s not too late to sell if you’re outside London. Regional prime property markets received a significant boost during the pandemic, as many people looked to escape the city for more green landscapes and space. Despite the Stamp Duty holiday coming to an end, a recent survey of buyers and sellers indicated that levels of commitment to moving remain solid. In fact, 15% of people have become more committed to moving over the past year.
- There are some changes in terms of desirable destinations. 42% of those who responded to one survey indicated that they were looking for a village location, something that has been a prime property trend since COVID-19 became prevalent in cities. However, many people are beginning to find city centre locations more appealing – just over 3% indicated that they had gone through this mindset shift. A big contrast to the -21% the summer before.
- Supply and demand continues to boost prices. For almost two thirds of buyers, the issue remains a lack of available housing stock – this is one of the biggest obstacles in the prime property market today. For now, at least, the prime property market in regional areas is going to remain a seller’s market.
- The market in central London has started to pick up again. While the regions might have been prime property hot spots in recent years, there is evidence that London is once again rising to the top of the desirable list. In the third quarter of 2021, prime central London prices began to experience growth once again. There are many factors influencing this, including the desire to buy which, for many people, has been frustrated by months of delays and which is now stronger than ever.
- A return of international buyers will drive further growth. There is already international buyer demand from areas such as Europe, North America and the Middle East. This has yet to return to pre-pandemic levels but, when it does, will provide a significant boost to the London housing market. Lower prices mean that there is more interest from buyers keen to claim a bargain in a market that will increasingly become more costly in the coming months. That’s especially as there is currently a currency advantage, with values 35% below June 2014 levels in dollar terms.
Prospects look bright for prime property, both in London and in the regions. These are markets that have proven resilient, even as conditions have continued to change.