The unexpected effects of the coronavirus on the London housing market

The unexpected effects of the coronavirus on the London housing market

Could Coronavirus benefit the property market?

With worldwide cases of coronavirus now surpassing 90,000 and government officials drawing attention to the threat of up to 1/5 of UK workforce being off sick at the same time during the peak of the coronavirus

The effects and urgency of the epidemic are ripe.

The detrimental effects of the virus on UK industry have been well documented.

The outbreak has forced UK businesses to suspend activity with partners in China, and other areas with high levels of outbreak, to avoid spreading the virus further. Keep Reading.

Airlines have suffered since travel is being restricted both by enforced regulations and by fear-driven decisions by individuals choosing not to travel.

Oil prices have dropped, supermarket shelves are left empty as people panic purchase, and streets are left deserted in areas where many people are affected and in quarantine.

Additionally, we have seen share prices plummet in the stock market in what the BBC deemed ‘the worst week since the financial crisis.’ Read more.

The global panic surrounding the virus is rife – and it is safe to say that there are very few elements of society that remain unaffected by COVID-19.

Coronavirus and the property world

 Although some investors have expressed fear that the virus could spark the beginning of a global recession, as experts in the property market and the field of development loans, Hunter Finance has an alternative take.

Of course, the virus has no direct impact on the buying and selling of homes, but the shared anxiety and uncertainty lends to less commitment and proactive decisions from buyers.

When considering the decision to buy a home, most purchasers look for:

  • Stability
  • Security
  • Guarantee

With the coronavirus, many of us have been left in a state of worry and uncertainty.

This ambivalence is felt in regards to our personal safety and the safety of those around us:

Fear over the impact on businesses we are involved in, the businesses we have shares in, the economy more generally, and the inevitable second-hand effects on the housing market.

However, these shared feelings of apprehension and uncertainty could, in fact, provide a crutch for the housing market.

One thing that may offer citizens security is in fact, purchasing a home.

  • For buyers, this means: a home to call their own
  • For developers, this means an extra source of income through buy-to-let. More investment advice.

A steady, lucrative and prosperous market

Figures show that housing prices have been rising at a healthy rate over the past 18 months – with inflation of 2.3% bringing the average UK house price to £216,092. Look here.

CEO at loan company Octane Capital, Jonathan Samuels attested to this prosperity within the property market, stating that:

“With the jobs market strong and borrowing rates highly competitive, it’s no surprise there is a rise in prospective buyers.”

This is good news for property developers.

Additionally, potential develops may want to capitalise on the additional space they can occupy in the housing market, since other developers may back away from current building plans due to the global fear caused by the coronavirus.

Though fears that the property market could be heavily hit by the coronavirus are not unwarranted.

There is clearly room for develops to use the current housing price increase to their advantage and move forward with potential development plans.

Take a look at some properties we have financed