We have been involved with mortgages and the wider property arena for quite some time now and we are always looking for ways to use our experience to predict the way things roll out for our clients. It is about this time of the year that we like to look back over the previous period and highlight the things that will impact the coming year. That said, looking back over the years to predict forward is not always easy. For example, some years just fly by without any real impact or anything unusual happening. When it comes to last year, however, it was probably as far from lacking impact in just about every way possible. One of the few things that we can be certain about after the wild ride with the pandemic in 2020, is that it has changed the way buyers will look at what makes a good home. For the short term at least, we all probably have a few different criteria in mind.
Many more houses are now suddenly a workspace and a living space.
This is certainly going to be a big factor in the requirements for potential buyers. Let me give you an anecdotal example of why. I was recently standing in a queue and two people were having quite a loud discussion over the social distance requirements. The topic under discussion was that both were thinking about moving home and one person was explaining they were looking for a three-bedroom house with a reasonably sized spare room. Not because of wanting more children or catering to guests, as would normally be the case, but because she was now working from home for part of the week and wanted to get off the kitchen table.
She is far from alone in this. A quick glance at the Office for National Statistics’ website will tell you that in April 2020 around 46% of people did some work from home. Clearly, a large percentage of this was prompted by Covid-19 safety, but even after accounting for that, the numbers are expected to remain high. It would stand to reason that either having (or the potential to have) a comfortable office area that could be pressed into service, if need be, is going to be a major selling point. As far as mortgages are concerned, that could mean an increase in the target price you are aiming for, perhaps a little location jiggling or another compromise to get the space you need at your current budget.
The market in 2020 was unusual but that doesn’t mean property itself is less reliable.
No matter what else happens there is always going to be real financial sense in buying property. People will still want to get on the property ladder and people will still want to move. A solid investment in either a personal property or a buy to let dwelling is going to be a safe, reliable and ultimately a very stable investment. It would take a major shift in the fabric of our society to change that and consumers and lenders all know this. So, with due respect to the doom and gloom merchants who are predicting a falling market, we say ‘Yes, maybe, but falling does not mean collapsed or static’. If the market does slowdown in 2021, and it may for a short period, it doesn’t alter how reliable a house purchase is as an investment.
Garden space or local green areas are suddenly more of a selling point.
Partially because as soon as spring rolls around and the lockdown eases we are all going to want to get out in the fresh air again as soon as possible. Also, there is a real feeling of awareness of the need for outdoor exercise. A sort of zeitgeist focused on fresh air. Couple that with an increase in working from home and it makes sense that gardens and local green areas such as nature reserves, inner-city parks and walks are going to be worth making a little more off to buyers. Sellers could do well to mention a more outdoor-focused quality of life about their homes.
Electric cars and connected worlds are becoming more important to many, but the opposite could be true for some buyers.
The recent decision to ban the production of diesel cars and the current aversion to public transport could well resonate with buyers. As electric and hybrid vehicles become more popular, the need to charge them will become important to home buyers. Good broadband and connectivity are clearly important to the remote worker. Conversely, while the distance to work is always a factor for those buyers who are still office based, the exodus from city life shows no signs of slowing down. The ‘place in the country’ or at least in a convenient out of town location where you can switch off from tech and stress, could be a big motivational factor after a difficult year.
Interestingly, despite the regular downbeat predictions from last year, mortgage approvals are at the highest level for well over a decade. While retaining a note of caution because of the upheaval of 2020, I think we can say that the future for the mortgage and property space is perhaps more turbulent than usual – but it seems pretty vibrant and active, nonetheless.
Whether you are taking your first steps towards getting a foot on the property ladder, buying a bigger place for your growing family or investing in property, being armed with the right information is essential to your journey. As we demystify the world of mortgages, we would like to offer our services for a free consultation – get in touch with us today!