Despite the enormous damage caused to the UK economy by Coronavirus in 2020, the property market remains remarkably string and buoyant.

It’s customary at this time of the year to look forward to the prospects of the next and according to Seven Capital the UK remains an exceptionally good place to invest in property. So much so they’ve identified nineteen (19) factors. We’re going to take a close look at 4 of these.

renting in Harlow and Essex

 

1 – Low Interest rates and stamp duty

There were two cuts in interest rates in March 2020 and the Bank of England Base Rate remains at 0.1%, the lowest it’s ever been. Therefore, a lot of lenders are offering extremely competitive and very accessible Buy-to-Let mortgages. This is great news for beginners looking to invest in the property market and also means that portfolio investors will find it easier to re-mortgage and release equity. Add to this the freeze in Stamp Duty until March 31st 2021 and purchasing property has become very attractive

 

2 – House prices are still on the rise

This has resulted in a nationwide rise in property prices. The graph below (courtesy of Savills) shows the predicted house price growth for 2021 - 2025. The graph shows different regions but does not take into account the fact that individual towns and cities are likely to over perform, and prices in those regions may be well in excess of predictions.


property growth in the southeast and other regions 

3 – Supply Driving Demand

It’s well known that in the UK there is an undersupply of residential property. This is a major driver in the rental market and a prime opportunity for property buyers – especially in urban centres. With Buy-to-Let mortgages worth over £1 trillion in the UK, research estimates that UK renters will outnumber homeowners by 2039. The private rented sector is also estimated to grow by 24% by the end of 2021

 

4 – Rents set to Rise

This also means that rents are set to rise as the market becomes more competitive and developments concentrate of quality over quantity. This is directly reflected in some key areas across the UK. The South East was forecast to see rental price growth of 11.5% over the next four years. In Birmingham rental growth is expected to hit 12.5% between now and 2023.

This concept of ‘Generation Rent’ is happening across the UK, directly appealing to investors that want to build a long-term portfolio. According to the Resolution Foundation, nearly 4 out of 10 ‘millennials’ are still privately renting at age 30, with 30% expected to be renting well into retirement.

renting a property in Harlow and Essex

We are definitely seeing a shift in culture to a more European way of thinking (only 43% of Germans own their own home, for example). The UK’s population is forecast to reach 74 million people in the next 20 years, a clear sign of the vast housing demand building within the market. A quarter of the UK is expected to be 65 or older by 2050 according to the Office for National Statistics. This shift in demographics opens up huge opportunities for property investment – a record 1.13 million over-50’s are renting, nearly double that of a decade ago. While young professionals make up the majority of the rental market, there’s no doubt we’re seeing a renaissance in older people choosing to downsize, particularly in major cities.

 

The Howick & Brooker Partnership is the leading and longest-established estate agency in Harlow. Howick and Brooker are members of the Guild of Professional Estate Agents.

 

If you are interested in moving into the Harlow area pleas get in touch.

T: 01279 418888

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