So here we are again, Halloween is just around the corner and there are Christmas adverts on the television already. Buyers are trying their best to buy properties to be moved in to by Christmas, companies are organizing much missed office festivities and life does seem to be back to the way it was prior to the pandemic hitting us. Even though it may seem and feel familiar to days gone by, there are a few changes that we are having to live with and incorporate in to our lives thus making things the new norm.
Stamp duty, or the lack of it, up until recent weeks, has been a major driving factor for the huge growth in both property values and property sales. The original stamp duty holiday was due to end on March 31 2021. However, Mr Sunak decided to extend the deadline until October, opting for a more phased approach. The rate of stamp duty which applies to your purchase depends on the date that you complete your property purchase and not the date that you exchanged contracts.
From March 31 to June 30 2021, buyers paid no tax on the first £500,000 on a property in England and Wales. Buyers could have saved up to £15,000 in tax thanks to the holiday. From July 1 to September 30, the threshold was tapered down to £250,000 which means no stamp duty is paid on a residential property bought for up to this amount. October 1st saw the nil rate band return to the standard amount of £125,000 and for first time buyers, this is set at £300,000.
In my opinion the other reasons for this unprecedented bolstering in the market has simply been life style and the way in which it has changed for everyone. Previously people bought a property because they thought it would be a great fit for their lifestyles, but when you think back our way of living has changed. Previously we woke up, showered, maybe grabbed breakfast, ran out the door either to work or to school. We came home late in the afternoon or early evenings, walked the dog, cooked dinner, did some homework or housework, maybe watched Coronation Street, Emmerdale or EastEnders and retired to bed only to repeat this pattern again day after day after day.
With the Lockdowns came an enforced new way of living. We found we had time, time that previously been taken away from us with the daily commute, the school run and doing the weekly shop. What could we do with this new found luxury? We baked, we learnt a new skill or even a new language, we did a lot of gardening, some of did a little bit more drinking than previously and some did the opposite and took up fitness and well being tasks. Our homes became our work places, our classrooms, we created man caves and hobby/crafting rooms. Lots of us made bars at home, had virtual diners or quiz nights with friends that we couldn’t physically be with. In short, the need of our homes changed, we required them to be more than a place to eat, sleep and clean.
Our homes now needed to be all things to all people and this is where a lot of people realized that they needed more and in some cases much more from their homes. As a result of this thinking, buyers are now looking to future proof their new homes, if they only needed two bedrooms previously, they are now looking at 3 or 4 bedroomed properties, if they had a courtyard before now, they are looking for a garden, if they had a garden, they are now looking for bigger gardens and so on and so on. This has inevitably led to property prices going up sharply as has the demand for them. The larger and usually more expensive properties are now the ones with the most interest from buyers and since lending is at one of its cheapest rates ever, borrowing does not seem to be as much of an issue as it has been previously. With us not being able to go out, travel, dine or shop, a lot of us have managed to save up for good deposits.
From 1918 up to 1920 we had the Spanish flu and after this came the roaring 20’s. Could we be seeing history repeating itself even if it is in a slightly reduced way?
I will end with this, here at Cross Keys Estates, we are selling more properties within the first few days of marketing than ever before and most of them are exceeding their asking prices by quite some way due to the current demand.
If you are thinking of selling or if you simply want to know the current value of your property, please do not hesitate to give one of our qualified and experienced members of staff a call.