As life inches back towards normality, there are some signs that the Covid-related scramble for property purchases is beginning to ease off. The stamp duty holiday is coming towards its end and figures suggest the start of a welcome slowdown in house price growth.
But the homebuying data from the past year makes for interesting viewing. Property values and searches have surged much more significantly in some areas than others, and the types of properties people want have changed too. It seems likely that the pandemic has altered the UK’s housing tastes, and many are now wondering whether the trends seen over the last year will continue.
The coronavirus housing boom
2020 saw an average house price hike of 8.5%. This represented the fastest percentage rise in six years, but in some areas the rise was much higher at well over 10%. There were a number of reasons for this, some of which were financial. Partly, the combination of generous government support schemes and a lack of opportunities to spend money on normal indulgences like holidays and going out left some people perversely better off than they were before the pandemic. Then of course there was the matter of low interest rates, which are bad news for savers but usually good news for mortgages.
But the Covid housing boom was about more than that. Forced to spend extended periods of time within their own four walls, people across the UK nations began to reassess what exactly they wanted from their homes and lives, and some were emboldened to set long-held pipe dreams in motion.
A place in the country
For many homebuyers, the past year has been the one where they finally made the move out of the big smoke. London, for example, saw only modest annual price rises in 2020 of around 3.5%, which was well short of the national average, and the story was the same across other major cities. Suburbia fared well – particularly areas with good transport links – but remarkably the shift towards rural areas was even more pronounced. Comparatively remote areas of the UK like the Isle of Skye saw a surge in interest, while Cornwall was one of the most searched destinations.
In many cases, the boom in rural sales will have been people buying second homes and holiday lets in a year where foreign travel was pretty much off the menu, but some people have also been making an even bolder lifestyle shift.
Commuting is SO 2019…
Fundamentally, most life choices are about compromise, and that’s especially true of where we choose to live. The country idyll is all very well, but half a century of under-investment and cost-cutting measures has left the British countryside woefully short on infrastructure and employment opportunities. For large portions of the population, working in cities is a fact of life, and there’s only so far you can commute to work each day before it starts to seriously affect your quality of life.
Except that for the past year huge numbers of people have been working from home. Suddenly the journey to and from the office is no longer something that happens each day but perhaps once per week or fortnight, if at all. In these circumstances, living close to work becomes less important compared to other considerations.
In terms of city living, it’s not just been the stick that’s been missing, but the carrot too. The nightspots, restaurants, arts venues and other cultural attractions that give city life its zest have struggled through the pandemic – often shuttered for long periods or with restrictive measures in place that strip most of the joy out of the experience.
Pandemic house shopping has also seen a notable swing towards larger properties, particularly those with three or more bedrooms and garages attached. Since family sizes haven’t been increasing (despite all those lockdown babies, figures suggest that the UK’s birth rate is actually teetering on a record low), it’s a safe bet that many of these spare rooms and garages are destined to be converted into home offices, mini-gyms or hobby spaces.
Interest in flats, on the other hand, has declined – which is understandable when you think back to the first lockdown when the suburbanites and country mice were all out having barbecues in their sunny gardens while the flat-dwellers looked mournfully at cordoned-off public benches and shuffled slowly around the park under the beady eyes of police officers.
Will these trends continue?
That, of course, is the question. The truth is that suburban and especially rural living have a lot of challenges too, but these have been much less obvious when the benefits of city living have been largely wiped out by Covid restrictions. A number of different factors could influence housing trends over the coming year, including the state of people’s finances and the potential resurrection of our social and cultural lives. A key thing to watch will be to what extent the workforce moves back towards the office. Home working has been a revelation for some businesses, but others have found it very challenging, and it’s likely that in general people could perhaps be asked to go back into the office on more flexible terms. Then, of course, we’re back to the question of compromise…