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The Race For Space

by Sep 2, 2021UK Property News

Welcome to our September Blog!

We are seeing a real ‘Back to School’ vibe in the past few weeks, and we anticipate that we will be having a busy autumn.

What we are seeing in the property market at the moment is that there are lot of buyers out and about, looking for their next new home, and a real lack of properties coming to the market. This squeeze on supply coupled with the boom in demand, has been pushing the house prices up, which are up 5.4% country-wide from August 2020.

A national view, however, can often mask important details in the local markets. The 5.4% figure is reflective of increases in property prices elsewhere in the country, when in fact, the London market has slightly softened. Even nationwide, the figure fails to account for the differential between flat and house price growth. The confident 7.3% growth of house prices is best looked at alongside the more sober 1.4% growth of flat prices. This difference, of course, makes sense given the increased demand for living space.

What Does This Mean For South London?

Well, working from figures from the end of June, London has been polarised by the pandemic-driven buying pattern. Overall, London’s home price growth is currently running at 2.3% compared to the national 5.4%, but demand for Outer London properties is still 83% higher than it had been in 2017-2019 — a period thought to be more indicative of the ‘normal’ market. The race for space has meant their outdoor areas are drawing domestic interest from the centre and its cluster of flats.

These patterns have been explained as a result of social and cultural change. The pandemic has redefined our relationships with the spaces in which we live. Months at home have left many of us longing for a new office, especially when some roles are transitioning to permanent work-at-home. More prevalent still perhaps is the desire for outdoor space, which, bolstered by the prolonged stamp duty holiday, continues to drive the desire to relocate.

The pandemic has played its part in another way as well, as it has curtailed some international investment into the prime Central London market. While the market has dipped, however, boroughs south of the river maintain positive annual growth, landing between 0% and 1%. However, with restrictions lifting and many properties coming to market in September and early October, it is likely we will see this changing soon. This is accompanied by the extension of the stamp duty holiday, which can mean savings of up to £2,500 and will last until the end of September.

This optimism is supported by changes in the rental market. Being quicker to adapt to societal change, it has already experienced an uptick in demand for areas in Central London, as people are more likely to start working back in the office at least part of the time.

If the uptick in demand carries into the sales market it will be great news for vendors in September and October who will be looking to be in new homes by Christmas.

If you want a more in-depth look at the property market and what this means for you and your property, please don’t hesitate to contact us HERE.