This week, we were again privileged to hear the latest thoughts from our friendly behavioural economist Roger Martin-Fagg.
Roger uses his study of human behaviour to predict economic trends, and the impact they will have on UK industries. Regular readers will remember me saying that Roger describes himself as being “…broadly right, the majority of the time…”, and his predications for the last year or so have followed this pattern, despite many of them not being widely held views at the time!
Firstly, what is a buyer in today’s fast-moving market?
The vast majority of those currently buying, are people who are able to exchange contracts quickly, either because they are first time buyers with a mortgage offer already in place, or because they have sold their own home and are renting (or staying with family), or they simply have the cash to exchange and complete!
Like I am sure many of you, we have been looking at the implications from the Budget announcements on Wednesday, and like us, I suspect most of you thought it didn’t hold too many surprises, given the government’s recent pattern of ‘leaking’ information ahead of time, and then confirming their plans.
Whilst there were lots of very big (and quite scary!) numbers, certainly in terms of the country’s debt, following all of the various support packages for the pandemic, there were also a number of very positive and encouraging signs, with the economy predicted to rebound to pre-covid levels later this year, as the vaccine rollout continues, and life get back to some sort of normality.
Those of you who are regular readers of our updates, will remember us mentioning our friendly behavioural economist Roger.
During the first lockdown, he was flying in the face of all the doom mongering media and their predictions for a long recession, and instead telling us we were all in for a huge rebound, following the pent-up demand, with everyone starting to spend again as lockdown eased.
As Roger often puts it himself, he is “…broadly right, the majority of the time…”, and certainly in property terms, it appears this was another of those occasions!
We are indeed in remarkable times – life changing, very sad, hopeful, frightening, unprecedented (in most people’s lifetime) – and all at the same time!
There are also an increasing number of positive stories staring to circulate; hope around vaccination, schools reopening (yes please!), holidays, and the economy rebounding.
The local property market (both Sales and Lettings) here in our beautiful part of the world are also experiencing unprecedented demand, and can be described with confidence by the word ‘vibrant’ (can you tell I have been helping with home schooling?) – so much so, that some new listings are attracting more than one buyer (six on one home!) who are ready willing and able to proceed, and we are receiving multiple applications on nearly all of the new lettings properties going live!
Like all businesses, Mortgage lenders are having to adapt to new ways of working with Covid 19, and each has responded differently, altering the way in which they do business, or making changes to their product ranges and lending criteria.
Lenders have a duty to ensure they lend responsibly, and many have changed the amount they will lend to customers.
There are currently far fewer options when borrowing over 85% of the property value, and borrowing over 90% can be particularly challenging.
Some lenders have introduced family assisted mortgages, which are designed to help first time buyers, and could be a great option for some.
The threat of a further downturn in the economy, and borrowers potentially being unable to keep up repayments on their mortgage is obviously a concern for lenders, and this is a particular issue for customers who are applying for a mortgage and whilst on the furlough scheme.
Another national lockdown is in place, but this time round there are some significant differences to earlier in the year, and we are all trying to fathom out exactly what it means for each of us, and more importantly how it will impact our lives!
One of the big differences within the world of property is that, while we still had a small team in place throughout the first lockdown, looking after the hundreds of properties we manage for clients, we were unable to show people around the fabulous homes we have for sale and to rent, or indeed come out and give advice and guidance to those thinking about making a change, and wanting to buy, sell, rent or improve their home.
Some are fortunate enough to be deemed locals – lucky them! Some are clever enough to have worked out why it’s one of the best places in Britain to live (and work!). Some have yet to make the decision to start to enjoying one of England’s finest areas and call it home for themselves and their family.