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Select Property Group has reviewed and collated some of the latest news and research published online by the UK property industry, including the latest investment forecasts and trends.
Here’s a selection of some key UK housing market news stories published in June 2020, with links to the original sources where you can read the full details.
Halifax has released its latest UK house price data for June.
Naturally, while there continues to be a slowdown in growth in light of the COVID-19 pandemic, there are plenty of signs that suggest the UK property market is emerging positively from lockdown.
As reported in the Guardian, last month the average UK property price fell by 0.1%, following similar moves recorded each month since the UK began enforcing lockdown measures in March.
However, while a minimal reduction such as this is to be expecting during this time, it will be the pace of recovery which should reinforce the underlying strength of the UK property market.
And Halifax revealed that there is much to be positive about.
The bank noted that it was “encouraging” to see that in June new mortgage inquiries from prospective property buyers in England – the first UK nation where estate agents have reopened – were twice the level they were at the previous month.
Furthermore, despite the coronavirus pandemic, Halifax figures show that the price of a typical UK property is currently 2.5% higher in June 2020 than it was in the same month in 2019.
Guy Gittins, managing director of estate agent Chestertons, told the Guardian that the Halifax data is a “clear sign that the housing market is recovering more quickly than anticipated”.
Reporting similar sentiment was Zoopla, one of the UK’s leading online property portals.
As outlined by Property Reporter, Zoopla has witnessed huge levels of pent-up demand for property that they have described as “off-the-scale”.
Its data suggests that average asking prices for property for the first week in June were 6% higher than they were in June 2019, while the demand for new property was 54% higher than it was at the start of March.
In addition, Zoopla sales have risen 137% since the property market reopened at the start of June.
It’s not just the sales market which is witnessing high levels of pent-up demand, either.
June paved the way for a flurry of activity in the UK’s rental sector, according to Goodlord’s latest rental index.
Reported by PropertyWire, the number of completed new rental agreements in June stayed above 2019 averages for all but six days of the month, marking a significant rise in activity over the previous month.
Rental costs for tenants also increased by 3% in England and Wales between May and June according to Goodlord.
“If May was characterised by a release of pent up market demand, then June was that demand translating into action,” commented Tom Mundy, Goodlord’s chief operating officer.
“Build, build, build”.
That was the message from UK prime minister Boris Johnson, as he outlined his plan to boost the UK economy following the coronavirus pandemic.
Mr Johnson wants increased levels of housebuilding in Britain to play an integral role at the heart of his ‘new deal’, with policies that Mr Johnson has likened to reforms set out by former US president Franklin D. Roosevelt to help America recover from the Great Depression of the 1930s.
As detailed by PropertyWire, the prime minister will relax planning restrictions from September to make it easier for property developers to demolish and reconstruct unused buildings.
There are also new provisions to ensure more unused commercial buildings, such as empty retail units, can be repurposed as residential homes.
“We will build fantastic new homes on brownfield sites and other areas that with better transport and other infrastructure could frankly be suitable and right for development,” declared Mr Johnson.
There could be good news for property investors in Manchester and north-west England.
A region that had already become increasingly in-demand from global investors in recent years, new data from Savills suggests that the north-west could post the strongest levels of property price growth in the UK over the next five years.
In light of the COVID-19 pandemic, This Is Money reports that Savills expects all regions in the UK to see growth plateau in 2020, with average UK property prices expected to fall 7.5% this year.
But taking a long-term view, Savills’ baseline projections for the next five years suggest that UK property prices could bounce back 15.1% by 2024.
And, when breaking it down by regions, it is the north-west which is tipped to post the highest level of growth in the country, with average property prices forecast to increase 24.1% over the next five years.
In comparison, Savills expects property prices in London to increase by only 4% by 2024.
These projections were released just a week after a group of leading business figures in Manchester confidently declared that Manchester’s property market was showing signs of recovery following three months of lockdown.
Talking to Business Live, one of these professionals, Zara Banday, partner at Manchester law firm Slater Heelis, explained that her company had seen “an upswing in enquiries” for property in recent weeks.
“Residential markets tend to be fuelled by confidence and we certainly see positive signs of a market bounce emerging in the north-west and beyond”, Banday explained.
University life for students starting courses in September 2020 may be a little different to the norm due to COVID-19.
However, new research highlights an enduring demand for UK higher education, particularly amongst international students.
Reported by the BBC, research from university marketing agency IDP Connect shows that of a survey of 6,900 international students, 69% of them do not intend to change their plans for the new academic year and will still take up their offers to study overseas, which includes the UK.
Naturally, UK universities collectively are likely to see a reduction in the number of students enrolling on courses in September because of the COVID-19 pandemic.
That’s why now, more than ever, student property investors should choose those elite UK university cities, where the demand to study at the country’s most prestigious institutions is likely to remain high, especially from international students.
In June, coronavirus did not prevent Knight Frank from working on the high-profile sale of two purpose-built student accommodation (PBSA) developments in the UK, totalling £90 million.
It represented Knight Frank’s largest transaction for the first quarter of the financial year, and also underlines PBSA’s enduring strength and appeal from global investors.
“This transaction represents the most significant deal in the UK student accommodation market since we entered lockdown in March,” commented Rachel Pengilley, partner in Knight Frank’s Student Property Team.
“The best in class assets are located in prime university cities. The acquisition demonstrates continued confidence in the sector from overseas investors. Despite a tumultuous first half of 2020, the long-standing fundamentals of the student sector remain attractive, and we are seeing renewed interest to acquire from a variety of funding sources.”
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