Published: 29/12/2020The pandemic has forced us to reassess where we live and how we work. And a lot of us have decided to move. The most recent data shows mortgage approvals at the highest level since September 2007 and house prices up 5% since September 2019. The residential market is particularly buoyant outside London in rural areas and small towns, but also within the capital, as people look for more space both inside (to work from home) and outside (prompted by the lockdown experience).
Demand has been boosted by the stamp duty holiday, and although there is some speculation that the market will cool once this ends, most analysts predict a further rise in house prices in 2021, with a consensus forming around an increase of 4%.
It’s a different story in the commercial property market however, which has been hit hard by the pandemic. A recent RICS survey showed over three quarters of respondents viewed the commercial market as being in a downturn, with demand for shops and offices the hardest hit as we have increasingly had to work and shop from home. Hotels and student housing have also seen reduced demand, whilst warehousing and industrial sites have fared better.
The office sector was already in a state of flux before the coronavirus hit in Spring this year, with the rapidly growing co-working sector replacing traditional serviced offices and individual office spaces. The pandemic has exacerbated this trend, as companies have reassessed their working practices and requirements, resulting in many downsizing or planning to do so when leases expire.