Recent figures from a Nationwide survey revealed that property prices have fallen for the first time in 8 years.
The building society stated that property values had dropped by 1.4% from June to May, as the coronavirus lockdown hit the housing market.
When the lockdown began, sales plummeted as viewings were halted and the property sector was in effect, frozen.
Thankfully, as restrictions began to loosen and the industry adjusted to the “new normal” with online and in-person, socially-distanced viewings, things began to pick back up.
However, this 4-month haunt on the property market created a surplus of pent-up demand of people looking to buy houses and an increase of activity on the housing market.
Is 2020 a buyers or seller’s market?
A busy market is good news for both buyers and sellers; since it encourages people to put their house on the market and also means that more people are considering buying.
There are multiple reasons why people are choosing to sell at this particular time:
- People who wanted to sell in March have now had to delay plans by months
- Many government incentives are being introduced such as reduced rates on mortgages
- People who have been living at home have reevaluated their living situation and decided they need a change
- Generally, property prices have reduced
- People who are anticipating another lockdown may want to move to a property with more space, a garden etc.
Since there are many people selling their homes there is a large supply of property on the market, and as supply increases and demand decreases prices must drop; making this the perfect time to buy a home.
Low-interest rates and government incentives
Many people are looking to buy because borrowing money is extremely cheap.
Low-interest rates mean cheap mortgages.
Furthermore, although in previous years we have seen a reduction in first-time buyers, new government schemes offer help to those who may only have a small amount of cash available for a deposit.
The purchase price must be no more than £600,000, but under this scheme, you can borrow 20% of the purchase price interest-free for the first five years as long as you have at least a 5% deposit.
If you live in London, you can borrow up to 40% of the purchase price.
The Help to Buy equity loan scheme is being extended until 2023.
Although, this extension will be restricted to first-time buyers purchasing newly built homes.
This evidence points to a healthy market of buyers, despite the current economic conditions, which means a fertile environment for those looking to make a profit through property development.
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Hunter Finance has been operating since 2010 and has helped to complete over 250 projects across the south-east of England.
The company was founded when CEO Bill Hunter noticed a gap in the market – where viable developments were being turned away by big banks.
Don’t waste your time on lenders who charge broker fees and may not invest! Find out how Hunter Finance can help you.
Today, we use our expertise in the property field, and their numerous connections and resources to ensure a lucrative investment for our clients.
- Why 2020 is a good year to buy a house
- Property forecast: First-time buyers to drive property sales over the next five years
- New sales figures suggest that house buyers are returning to the property market
- Properties we’ve financed that buyers loved in the home counties
- First time buyers: low-interest rates suggest now is the perfect time to invest
- UK House Prices: Annual drop for first time in eight years
- UK property remains a good long-term investment