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Property market predictions for 2021 – what can we expect?

By Matthew Lane

The property predictions for 2021 continue to roll in, as the sector looks ahead to the upcoming 12 months.

Here, we get the thoughts of leading property developer GRE Assets and leading, independent buying agency Black Brick, on where the market will go next year.

A promising start to 2021

GRE Assets believes that, with pent-up demand after Lockdown 2.0 and promising news surrounding a Covid-19 vaccine, the UK property market should expect an encouraging start in 2021.

Michael El-Kassir, managing director of GRE Assets, which specialises in residential property development and regeneration in strategic locations across the UK and Spain, below explains what the company has experienced in the latter half of 2020 and how he believes this will inform the market as we approach 2021.

“As 2020 draws to a close, the market is showing continued growth with interest from both buyers and renters in new-build developments located in towns and cities undergoing major regeneration,” he comments.

“This trend directly aligns with our criteria for identifying investment locations which offer affordability, transport connections and ongoing regeneration, as seen in our Ashford and Peterborough projects.”

He says, with the imposed lockdown restrictions meaning people have spent much more time at home this year, this has led to a distinct rise in the number of people seriously considering their next property move.

“Low interest rates, the existing Help to Buy scheme and stamp duty incentives have also created a sense of urgency,” he adds.

“The pandemic has been a wake-up call for prospective buyers and renters, who have reassessed their priorities when looking for their next home. Not only are they spurred on to make the leap from London, they also recognise the importance of having access to green space, whether that is nearby parks, balconies, terraces, and gardens.”

El-Kassir also points to the vast shift in the working world, as employees and companies have adapted (in many cases seamlessly) to working from home.

“While people will return to the office as the latest restrictions ease, we strongly believe businesses will continue to work flexibly moving forward, meaning adaptable

space and connectivity at home is of high importance for new homeowners,” he explains.

“At GRE Assets we pride ourselves on delivering high-quality, well-connected homes which respond to residents’ long-term and short-term needs. Our Riverside Park project in Ashford is a great example of this. The provision of outdoor space, Hyperoptic broadband and space to work from home has proven to be especially popular in 2020, and we are confident this will continue into the new year.”

In particular, he thinks the South East will continue to be one to watch in 2021, with GRE witnessing increased demand and lack of supply in this area post-lockdown.

“While UK-wide we have seen a rise in house prices and activity, it is the South East that really stands out,” he insists.

“The region offers the near-perfect package of high-quality, affordable homes in popular regeneration areas with excellent connectivity to London. Demand here is currently outstripping supply, which is something we intend to continue to address as we head into 2021.”

The company already has properties available in Ashford, and is exploring other opportunities across Kent and the wider South East, to ensure its clients ‘receive the best investment options’.

GRE Assets also anticipates that the recent news of the successful Covid-19 vaccine trials will kickstart a positive wave from house hunters, as people can start to see the end in sight and are, as a consequence, more confident about planning ahead.

“Even though we know the vaccines will not be rolled out to all for a number of months, it is enough to give people the hope they need to start their property searches. The news is likely to provide a green light for people that were previously apprehensive and boost buyer confidence within the market as we move into 2021.”

GRE Assets has a number of key developments in its UK portfolio, including Nene Wharf Apartments in Peterborough, Riverside Park in Ashford, Brighton Marina, City Tower in Reading and One Smithfield Square in Manchester. Additionally, it can point to Brises Diagonal Mar, Bac De Roda and Morales in Barcelona.

As well as its UK operations, the Oxford-based property development and investment company has an ever-expanding international operation, with additional offices in Riyadh, Dubai, Barcelona and Madrid.

Predictions and trends for 2021

Black Brick, the well-known independent buying agency founded by Camilla Dell in 2002, which provides expert advice to buyers in London, the Home Counties and the South East, recently released its December 2020 newsletter, in which it outlined its main predictions for 2021.

Below, we take a closer look at the key takeaways.

Q1 2021 – expect the unexpected

Black Brick’s managing partner Dell and partner Caspar Harvard-Walls expect a bumpy outlook in Q1, with the expiry of the stamp duty holiday on homes worth up to £500,000, the introduction of a 2% foreign buyers’ surcharge, speculation over changes to Capital Gains Tax in the spring Budget and adjustment to life outside the EU all making things a potential rollercoaster ride for a while.

The ’greening’ of the real estate sector

The company believes buyers will become more sensitive to whether a building is ‘green’ enough. For example, are the building materials sustainable? What is the home’s carbon footprint? And what is its energy efficiency rating? (The latter is already a factor important for landlords because of regulations surrounding minimum energy efficiency standards).

The agency thinks developers will need to look at how they can incorporate this growing sustainability trend into their schemes, with ‘super-prime’ developments likely to be marketed on this basis.

“Being green will overtake being swanky,” Dell says.

The 15-minute city

The likely continuation of working from home and the shift to online shopping points to the need for a more unique high street experience, close to home rather than the office, Black Brick predicts.

This dovetails with the rising trend of the ’15-minute city’, which the agency expects to rise to further prominence in 2021 – helping London to become greener in the process, too.

The 15-minute city is a concept, being considered across the world, which puts forward the merits of a decentralised city, without cars and where everything can be reached within the magic 15 minutes on foot, by bike, or by public transport.

Carlos Moreno, a scientific director and professor specialising in complex systems and innovation at University of Paris 1, and Parisian mayor Anne Hidalgo’s special envoy for smart cities, said of the 15-minute city concept: “At its heart is the concept of mixing urban social functions to create a vibrant vicinity.” Paris’s City Hall is attempting to turn the French capital into what Moreno calls a “city of proximities.”

Moreno’s 15-minute concept was developed chiefly to reduce urban carbon emissions, reimagining our towns ‘not as divided into discrete zones for living, working, and entertainment, but as mosaics of neighbourhoods in which almost all residents’ needs can be met within 15 minutes of their homes’.

The idea being that, as workplaces, stores and homes are brought into closer proximity, street space previously dedicated to cars is freed up, in turn eliminating pollution and making way for gardens, bike lanes, and extra sports and leisure facilities.

This enables residents to bring more of their daily activities out of their homes (which in major cities, including London, can sometimes be small and cramped) and into ‘welcoming, safe streets and squares’.

The concept is far from novel, but the idea of the 15-minute city has really caught on as a brand – and a philosophy – with authorities in Barcelona, Detroit, London, Melbourne, Milan and Portland all espousing similar visions to the Paris blueprint.

Covid-19 has helped to highlight the potential need for 15-minute cities, with commuting becoming a thing of the past for many people and cities left empty by a lack of workers and tourists.

With globalisation potentially receding as a result of Covid-19 – and other events such as Brexit and climate change – the idea is to reform and rethink cities as destinations primarily for ‘people to walk, bike and linger in, rather than commute to’. This recent Bloomberg article explains the phenomenon in more detail.

Mark Sutcliffe, of smarttransport.org, writes of the concept: “Instead of sucking workers, shoppers and students into congested city centres, the 15-minute approach devolves the provision of day-to-day needs to a neighbourhood, so nobody needs to travel more than 15 minutes to earn a living, buy food, see a doctor and educate their children.”

During the lockdowns, huge swathes of Central London streets have become more pedestrianised, including Regent Street. Black Brick also points to buyers already seeking out leafier suburbs ‘with character high streets’.

The agency believes high streets outside Central London will be an important driver of the post-lockdown economic recovery, with 41% of all London businesses located on high streets and their immediate surrounds, and 28% of all jobs in the capital.

“St John’s Wood is an obvious example of a 15-minute city within London, providing one reason why house prices have risen so drastically this year. White City is moving in this direction, with the new Television Centre development, while Richmond, Dulwich, Hampstead and Chiswick are all good examples, too,” the agency claims.

A year in transactions

Black Brick says that, despite the many challenges of 2020, its team still acquired £59,077,000 of property with 19% of this off-market. What’s more, on average, it saved its clients 7.1% when buying a home.

You can see the full Black Brick market update here, where it outlines its highlights and best transactions of 2020 and goes into greater depth about the possible greening of our cities, including the creation of communal gardens and garden communities.

UAE residents can still access UK mortgages post-Brexit

By Alice Haine

Leading bank Santander has barred applications from non-residents

A pedestrian walks past residential houses in Notting Hill in London. With no Brexit trade deal in place yet, UK lenders are making their own decisions over how to ensure their lending policies comply with legal and regulatory obligations post-December 31. Bloomberg.

UAE residents looking to buy a property in the UK after the country exits the European Union can continue to sign up for expatriate mortgages, say analysts, after one of Britain’s biggest retail lenders barred applications from non-residents.

Santander Bank stopped accepting new applications for residential and buy-to-let mortgage applicants from non-UK residents on Monday, making it the first major retail lender to confirm changes before the end of the transition period on December 31.

Camilla Dell, managing partner at Black Brick, which helps Middle East investors purchase property in the UK, expects other lenders to follow Santander’s lead and ask more questions when it comes to EU residents or nationals living in the UK.

However, any revised lending criteria from banks for EU citizens linked to Brexit won’t apply to UAE residents looking to borrow on a UK property, she said.

“There are still lots of options for expats and international buyers, particularly in the HNW (high net worth) space where Private Banks can take a more flexible approach,” said Ms Dell.

“The treatment of UAE or Middle East-based clients has not changed markedly for some time and Brexit should not affect this as these clients are clearly outside of the eurozone. EU nationals who recently moved to the UK or are primarily resident in their home countries will be the most affected by these rule changes.”

Britain’s Brexit transition period ends on December 31 but the country has yet to secure a trade deal with the European Union, leaving lenders to make their own decisions over how to ensure their lending policies comply with legal and regulatory obligations post-December 31.

Under Santander’s new guidelines, existing European Economic Area (EEA) or Swiss borrowers who live in the UK but are foreign citizens, and who have a deposit or equity of less than 25 per cent and use their income to borrow money, must now prove that they have the right to live permanently in the UK. This also applies to foreign citizens taking out a joint mortgage with a UK citizen.

Santander said it does not lend to buyers living in the Middle East, as this does not come under its lending policy.

“Santander residential mortgages have always only been available to customers who intend to occupy the property immediately and therefore live in the UK. Buy-to-let mortgages are available for UK residents, or those who have a permanent right to remain in the UK,” a spokeswoman told The National.

Skipton International, which provides UK buy-to-let mortgage for expatriates and overseas residents, said thousands of UK expatriates living in the EU have been advised by their UK bank that their bank accounts and credit cards will be closed because of Brexit.

At least 13,000 customers have already received letters from lenders such as Lloyds, which owns Halifax and Bank of Scotland, and private bank Coutts, to say their bank and credit card accounts will be terminated at the end of the year, once the Brexit transition period ends on December 31.

Jim Coupe, managing director at Skipton International, said it will not be making any Brexit-linked lending changes and will continue to support customers across the globe. Courtesy: Skipton International.

Jim Coupe, managing director at Skipton, said while the full details of the Brexit trade deal negotiations have yet to be decided, it is clear that some UK banks are withdrawing their offerings to those living in the EEA. However, the lender does not plan to change its offering for UAE residents.

“Skipton International, being based in Guernsey which is outside of the EU, will not be making changes directly as a result of Brexit, for us it is very much business as usual where we will continue welcoming applications from across the globe,” he said.

The lender said it has seen record demand in the second half of this year, driven in part by the announcement by the UK finance minister Rishi Sunak of a stamp duty holiday until the end of March next year for properties worth up to £500,000 ($671,486).

“Together with a 2 per cent surcharge for foreign resident buyers coming into force on April 1, there is an incentive of up to £25,000 for property purchases to complete by the end of March,” said Mr Coupe.

For EU residents either living in the UK or living in Europe, the situation is more complicated.

“Mortgage lenders have always considered those who need specific rights to reside in the UK to be a slightly higher credit risk because there’s a chance their right to reside could be taken away in future, potentially leaving them in a more difficult position regarding their properties and mortgages,” said Ms Dell.

However, providing the borrower has EU national settled status, they should not have any more difficulty than British residents in the UK in securing a mortgage, she said.

“For example even non-EU nationals with indefinite rights to reside in the UK have been treated the same way as British borrowers for years. It boils down to whether there’s ever a risk that the borrower could be deported during the term of the mortgage. If not then the risk is viewed the same as a Briton’s,” Ms Dell said.

UK mortgage approvals reached their highest level in 13 years in November as tighter Covid-19 restrictions failed to dent strong demand for home loans, according to Bank of England data.

The central bank said there were 97,500 loans approved by lenders in October – the highest figure since September 2007. Meanwhile, house prices recorded their strongest growth since 2004 in November, with the average home now selling for £253,000, according to the Halifax’s House Price Index.

Biggest property bargains on offer since financial crisis in London’s most expensive postcodes

By Marianna Hunt

Prices for prime homes in the capital have slumped, with supply soaring and fewer buyers around.

Prices of London’s most expensive homes are at the lowest level in seven years, with some buyers able to strike bargains not seen since the financial crisis.

In October values of property sold in the priciest postcodes of the capital fell by 3.3pc compared with the same month last year, according to LonRes, a data provider. This means that prices per square foot for the capital’s most exclusive homes are now the lowest they have been since 2013.

These drops in the capital buck the national trend, as Halifax bank’s latest index suggests average house prices have risen by about 7.5pc in a year in the recent “mini-boom”.

The number of properties on the market in prime central London is up by 68pc compared with last year, LonRes found. However, sales agreed have not risen in tandem, as international buyers have been unable to visit during the pandemic.

As a result, bargains are available the likes of which have not been seen since the financial crisis, said Camilla Dell of Black Brick, a buying agent. “This time, it’s even better because there are fewer buyers around to compete with. There are not many moments I’ve seen where you can get these kinds of deals. ”

It is in the city’s “golden postcodes” – traditionally prized spots such as South Kensington, Knightsbridge and Belgravia – where you can find the best bargains, she added.

“These areas have been hard hit by coronavirus. Firstly because they’re traditionally dominated by overseas buyers.

“Secondly because properties here are mostly flats without outdoor space, which is not what domestic buyers are after at the moment,” she added. “One agent who is trying to sell a £40m home in Belgravia said it was like tumbleweed.”

In Knightsbridge and Belgravia, prime property prices are currently 16pc lower than they were at their peak in 2014, according to private bank Coutts’ London luxury property index. It uses data from LonRes, which found that the cost of property in the area is now £1,886 per sq ft – the lowest it has been since 2011.

In South Kensington prices are down by 16pc from their peak, the lowest they have been since 2012.

“Fulham and Earl’s Court have been particularly hard hit this year because they have lots of new-builds, which traditionally get snapped up by international buyers,” Ms Dell said. Prices here are down by 19.2pc compared with peak levels.

London’s leafy suburbs have fared better thanks to their larger homes and bigger gardens. In Wimbledon, Richmond, Putney and Barnes prime property prices have risen by about 4pc in the past year, according to Coutts. Homes in these areas take on average 135 days to sell – a month faster than the rest of the prime London market. As a result the premium buyers pay for a luxury property in the city centre compared with its outskirts has dropped from 91pc in 2019 to 82pc this year.

Falling demand in SW and W postcodes has opened the way for bargains. Ms Dell recently secured a two-bedroom apartment in Ebury Square, Belgravia, for a client for £3.32m – with a discount of £1m (22pc) off its original asking price.

Jeremy Gee of Beauchamp Estates, a property firm, said he was currently trying to find a buyer for an off-market property in central London that had a £10m discount. “It is 16,000sq ft and would normally cost about £40m but the buyer is only asking £30m,” he said.

Savills, the estate agency, has predicted that prime property values in the capital will jump 17.5pc by 2024, ending a long downward trend.

The firm’s Lucian Cook said: “The data suggests that the top end of the market remains poised for recovery as soon as international travel resumes and London’s streets regain their normal buzz. The successful development and distribution of a vaccine against Covid-19 is an important part of this.”

While some are worried that the city will lose some of its shine following Brexit and the introduction of an extra 2pc stamp duty surcharge for overseas buyers in April, others are more confident.

“London isn’t the cheapest city for property taxes, but it’s far from the most expensive either,” Mr Gee said. Buyers in London do not have to pay holding taxes on their properties, as they do in New York, Madrid or Paris. “There’s a lot of pent-up demand from international buyers, and extra stamp duty won’t put them off,” he added.

With Widespread Work-at-Home, Americans Looking to the U.K. Anew

By Liz Lucking

A new group of U.S. residents are looking to try living across the pond

The number of U.S. buyers in London had been rising for some time, driven by a favorable currency exchange and discounted prices, but now, the coronavirus pandemic and the increasing adoption of working remotely has led to an opportunity for a new group of U.S. residents trying the city on for size.

One of the biggest trends witnessed recently by Guy Bradshaw, head of London residential at Sotheby’s International Realty U.K., is U.S. residents looking for one-year rentals in the city.

The pandemic has resulted in changing work patterns, and now “U.S. buyers and tenants are seeing a window of opportunity to try something different,” he said. “Families are saying, ‘Let’s try the U.K.’”

That’s exactly what one of Mr. Bradshaw’s clients did, a young family with two children from New York, who found themselves a townhouse in central London with a garden, and who preferred not to be named or disclose pricing.

“We chose to move to London as the opportunity presented itself due to the fact that our childrens’ learning has now moved online for the foreseeable future. We feel that it’s a great time to experience a different culture and lifestyle for 12 months or so and see how we adapt to living in Europe,” they responded to Mansion Global over email. “My husband’s work is global, and he can work remotely, so it’s a perfect opportunity for us to try something new.”

For the New York-transplants, being close to a park was a must, they said, as was being able to walk to amenities such as shops and cafes. “We wanted a neighborhood feel within the city as we are used to city life back home.”

London’s time zone—five hours ahead of the East Coast—its business sector, the nationwide health care and the infrastructure, are all considered assets to those headed across the pond, according to Mr. Bradshaw.

Many movers are from major metropolises like New York City and Los Angeles, and typically have budgets of between £2,000 (US$2,587) and £8,000 per week, he said.

They aren’t just renting, but buying, too.

U.S. buyers have been responsible for 14% of mortgage deals being secured by foreign buyers across the U.K.’s prime housing market in the year to mid-October, according to a report released earlier this month by high-net-worth mortgage broker Enness Global.

They were the second most prominent group of international buyers, behind those from the U.A.E., the report found.

Eventual lifting of international travel restrictions is expected to further boost their numbers.

Visitors to the U.K. from the U.S are currently required to quarantine for two weeks, a measure that is holding the market back and putting off potential buyers from viewing properties in the U.K. in person.

“A lot of people want to invest,” Mr. Bradshaw said. But “if you’re coming in [to view properties], you have to do a two-week quarantine. They don’t want to be here for two weeks. That’s the biggest frustration.”

In Battersea, a neighborhood on the banks of the River Thames in south London, home to the new Nine Elms development and the new U.S. embassy, there has been “a significant increase in the number of U.S. buyers looking to buy family homes or large apartments,” according to Keir Waddell, head of Knight Frank’s Battersea and Riverside office.

“We have seen far more people who were based in the city—and potentially living more centrally—coming to look at Battersea. A noticeable amount of U.S. buyers,” Mr. Waddell said.

The move further afield echoes the larger trend of city residents moving out to the country during the pandemic. Battersea “is their version of moving out to the country,” he said. “It has a bit more of a family feel.”

Though the coronavirus pandemic may have prompted a new segment of Americans to transform into Londoners, their presence in the city was notable before now.

“In 2007, we had zero clients from the U.S.,” said Camilla Dell, managing partner and founder of London-based buying agency Black Brick. “Then, over the last two or three years, more U.S. clients than ever before.”

Their arrival is driven by a number of factors.

“One is [President] Trump. A number are not Trump fans, it would be fair to say,” Ms. Dell said.

Another is the favorable currency exchange rate, and for “U.S. citizens living in California, with wildfires and climate change, climate plays a factor too,” she said.

However, “I can’t say that we’ve been flooded [with buyers] from the U.S. from the pandemic,” Ms. Dell added, citing the difficulties posed by the two-week quarantine.

Whether relocating due to the pandemic, political or work reasons, U.S. movers have a fondness for London’s high-end neighborhoods.

For those relocating permanently, Notting Hill is popular, and, for the U.S. buyer looking for a pied a terre, Mayfair is the place of choice, according to Ms. Dell.

St Johns Wood, home to The American School in London, is also a popular destination. Around Halloween, due to the high-density of U.S. residents who live there, it’s the most impressively decorated spot in the city, Ms. Dell said.

When it comes to amenities, three things are top of their lists: home offices, a roof terrace or garden, and parking, according to Mr. Bradshaw.

“The office space and outdoor space has been absolutely critical since the pandemic,” Mr. Bradshaw said. “The key aspect is can they work from home? And if you can’t get one or two working from home in private, it’s not going to work.”

Lack of overseas buyers hits London’s prime property

Sales and rental prices are down in the capital’s most exclusive postcodes – but activity is returning

By Liz Rowlinson

In July, Tel Aviv-based corporate lawyer Ami H Orkaby bought an apartment in London’s Mayfair. When he can fly to London he intends to use it himself, making the most of the expensive restaurants, the shopping and Annabel’s private members club on his doorstep.

“I am confident that Mayfair will bounce back after the pandemic, like it has done many times before in history,” he says. “I saw an opportunity to buy in the current market, with a weak pound and a softening of prices.”

These days, wealthy international buyers are conspicuous by their absence in parts of central London. Some streets remain eerily quiet and free from the supercars that regular visitors like to bring over for the summer.

The lack of buyers and renters from overseas has hit the local sales and lettings markets. While parts of the country underwent something of a “mini boom” when the housing market reopened after the Covid-19 shutdown — the UK’s average property price surged in August to record levels, according to Nationwide — demand for London’s prime homes has been slower to bounce back.

With so much interest in suburban and rural living recently, we took a look at the property market in the capital’s most exclusive neighbourhoods, to see how its luxury real estate is being affected by the pandemic.

How many homes are selling?

In July and August, the number of homes sold (exchanged) across London’s prime areas across all price brackets was down by 24 per cent compared with the same period in 2019, according to data from LonRes, a research company.

However, for the capital’s most luxurious homes, those priced above £5m — where sales tend to be less reliant on credit — transactions in July and August were actually significantly higher than they were last year: up 31 per cent on the same period in 2019.

Marcus Dixon, head of research at LonRes, says he thinks the prime London market has been resilient. “Transaction volumes are recovering,” he says. While sales are still down, the number of properties going “under offer” in August was 8 per cent higher than in the same month last year.

Guy Gittins, managing director of Chestertons, which specialises in selling homes in prime central London, says his agency had the busiest July in four years. That month, they dealt with 1,150 offers and agreed the sale of 272 properties, compared with 780 offers and 181 agreed sales in July 2019.

Time to bargain?

One of Chestertons’ sales agreed in July was a three-bedroom apartment in Mayfair that went for £4.65m. The Hong Kong-based purchaser, who had viewed the apartment a year earlier when the asking price was £5.95m, now thought it looked good value.

The property was initially put on the market back in May 2018 for £6.5m — meaning the final sale price was 28 per cent lower than the seller had originally hoped for.

But such price drops are not the norm, Dixon says. Across prime property in central London, the average discount achieved in August was 7.6 per cent lower than the initial asking price — smaller than it was in August 2019, when the average discount was 8.9 per cent. In fact, achieved prices in August were up 2.8 per cent on where they were a year ago, according to LonRes.

Savills, though, expects prime house prices to fall 2 per cent this year, and predicts slower price growth than after previous downturns due to the pandemic’s impact on the global economy and wealth generation.

“The pace of the recovery will be dictated by the lifting of travel restrictions,” says Lucian Cook, Savills’ residential research director, who is confident London’s appeal to overseas buyers will endure.

The lack of overseas buyers

In the 11 weeks to mid-August, the number of new buyers registering with Savills who were looking for £1m-plus homes in the south of England, excluding London and the commuter belt, was up 120 per cent on the pre-pandemic average.

In central London, where international buyers have been unable to view homes because of travel restrictions, prime registrations were down nearly 20 per cent.

This has meant UK-based buyers have faced less competition, agents say. Peter Wetherell, chief executive of Wetherell estate agency, points to the sale of a property at 47 Grosvenor Square for £18.6m, which went to a UK-based family in August within 24 hours of it going on the market.

At the end of July, Wetherell sold a four-bedroom home at 76 Park Street, also to a UK-based buyer, for £4.85m. It had a guide price of £5.5m.

As in Mayfair, the lack of international buyers in the Knightsbridge and Regent’s Park areas is a growing concern. “They still want to buy in London but can’t get here,” says Paul Finch of Beauchamp Estates. Other world cities face the same problem, he adds: “Which other cities might [investors] choose? The grass is not greener in the markets of New York, or Hong Kong.”

It’s clear that the buzz and many of the things that make London great are just not there right now Camilla Dell, Black Brick. In Hong Kong, which had experienced widespread civil unrest and pro- democracy protests before the arrival of Covid-19, sales of properties priced above HKD $20m ($2.56m) dropped by 17 per cent in the first half of 2020, compared with a year earlier — reaching their lowest level since 2016, according to JLL, the global property company.

In Manhattan, the number of sales in the second quarter of 2020 was down 54 per cent compared with the same period last year, the largest decline in at least 30 years, according to estate agency Douglas Elliman. The median sales price fell 18 per cent, compared with the same period last year, to $1m, the biggest drop in a decade.

Estate agents in the UK capital argue that upheaval elsewhere in the world could benefit London’s prime market. Many cite the possible demand from the 200,000 Hong Kong citizens who, according to Foreign Office estimates, could move to Great Britain in the next five years.

A steep drop in rents

Travel restrictions have also had a big impact on the rental market, which has been hit by a sharp drop in demand and significant increase in supply. Since June, the number of new lets every month has been 25 per cent lower than in the same month in 2019, according to LonRes. Meanwhile, there are now 60 per cent more properties on the rental market than a year ago.

The lack of tourists has forced Airbnb landlords to list their homes on the long-term rental market. Since May, about 12 per cent of all the new homes available to rent in London’s Zone 1 were previously let on a short- term basis, according to Hamptons, which calculates that the average rent in inner London in July was 8.4 per cent lower than in July 2019.

“After six months of receiving no rental income, the high service charges and mortgage payments are beginning to bite so landlords are staring down the barrel,” says Cory Askew, director of central London sales at Chestertons. “Some are selling up, others are dropping their prices.”

“It’s a great time for tenants to negotiate 20 per cent off their rent,” says Gittins.

Changing tastes

In recent weeks, the popularity of London’s prime “villages” — smart, green areas such as Richmond and Hampstead — has surpassed the capital’s traditional golden postcodes in Belgravia, Knightsbridge and Kensington, says Camilla Dell of Black Brick, a buying agent.

In anticipation of future lockdowns, buyers are looking for access to parks (for all those quarantine dog purchases) and good high streets.

“Buyers might only move 2km in search of a better environment, and more space, for the same budget,” she says. Now, they might opt for a house in St John’s Wood in north London, rather than a flat in Marylebone in central London; or a four-bedroom house in west London’s Fulham with a garden, in preference to a two-bedroom flat in South Kensington.

House and Home unlocked

In Chelsea, the market for homes below £2m has been the strongest, driven by purely UK-based buyers, says Percy Lendrum of estate agents Dexters. “A two-bedroom flat in Lennox Gardens sold within 48 hours for well over the asking price of £1.25m after five offers.” Such properties overlooking communal gardens are much more likely to sell after Covid-19 than those without, he says.

But the future of prime central London all hinges on whether people will actually want to live and work there post-pandemic, or if the city endures another lockdown.

“When we do viewings there, it’s clear that the buzz and many of the things that make the city great are just not there right now,” says Dell. “But it’s too early to say whether the shine has gone off London as an investment.”

Footballers turning to hotels as coronavirus shrinks supply of pricey rental homes

By Melissa Lawford

Premiership players with budgets of £15,000 per month are finding it difficult to rent in the footballer zone south-west of London

Footballers in the Home Counties are having to move into hotels ahead of the new season as the supply of high-end rental homes has dried up.

Alex McLean, head of the sports team at Knight Frank’s relocation services business, said that a lack of pricey properties to rent along the A3 corridor out of south-west London means “a lot of players are ending up in hotels”.

Accommodation budgets of Premiership players, who often opt to rent, especially at the start of their club contracts, often exceed £15,000 a month, said Mr McLean. But the pandemic has shrunk local supply in their favoured towns, which include Oxshott, Esher and Cobham in Surrey.

This means that newly-signed players, such as Thiago Silva and Ben Chilwell who are moving to Chelsea, may find it difficult to rent a property near the club’s training ground in Cobham.

James Dodds of Grosvenor Billinghurst, a Surrey estate agent, said: “I can’t remember a time when there was this much movement in the super high-end rental market.” Footballers in these areas also have to compete with wealthy workers at nearby tech firms.

The post-lockdown property “mini-boom”, driven by Chancellor Rishi Sunak’s stamp duty holiday and a shift to working from home, means that many high-end homeowners are taking the opportunity to sell their homes now while prices are high, and renting until prices fall when the impact of the recession bites. The sales market had been sluggish for several years before the pandemic.

In the three months to August, the number of homes worth more than £5m for sale outside central London doubled compared to the same period in 2019, according to Knight Frank.

Meanwhile, between April and August in the south-west corridor, which includes areas such as Ascot and Cobham, the number of high-end rental properties coming to the market fell by 20pc compared to the same period in 2019. For homes renting for more than £15,000 per month, the number fell by 55pc.

The footballer zone along the A3 is an anomaly: across London and the Home Counties, over the same period, the number of overall rental listings jumped by 28pc year-on-year.

Within the capital, the contrast is even more stark. Camilla Dell, of Black Brick, a buying agency, said landlords who have recently renewed tenancy agreements in London have had to accept 10pc and 20pc rent reductions. “Flats without outside space are faring the worst,” she added.

There is more demand than usual from footballers to rent big homes in this area, and some are moving there because they want more green space after lockdown. “Chelsea has spent a lot of money on new players, but there are also footballers for the London clubs who have decided to move out this way,” said Mr Dodds.

There is new demand for pricey rental homes in this area from footballers at south London clubs such as Crystal Palace and Millwall as well as Chelsea, Fulham and south coast teams such as Bournemouth and Southampton, said Mr Dodds.

The footballers looking to rent now are late to the trend. When the pandemic started, “there was a snap reaction from some very, very wealthy Londoners to rent a Surrey mansion,” said Mr Dodds.

“We had a chap where there wasn’t a figure for a budget, we were trying to negotiate him renting a whole hotel and its cottage in the grounds. The deal was going into a couple of hundred thousand pounds a month,” said Mr Dodds.

But while demand for luxury rentals has spiked, supply has dropped.

London’s Housing Market Lures Hong Kongers Seeking Safe Haven

By Poppie Platt

Wealthy Hong Kong residents seeking to escape the city’s political upheaval are flocking to London, offering a potential lift to the capital’s ailing luxury housing market. Realtors are seeing a surge in interest from Hong Kong, driven by falling prices, favorable exchange rates and Prime Minister Boris Johnson’s easing of immigration rules for many residents of the former British colony. The number of Hong Kong clients registering with upmarket real estate agency Chestertons is up nearly 80% this year compared with 2019, while inquiries at Black Brick Property Solutions and Beauchamp Estates are up by about a fifth.

An influx of Hong Kong buyers would give a boost to London’s prime residential market, where prices have fallen by more than 20% since 2014, according to broker Knight Frank. Investors from the Asian financial hub accounted for nearly 10% of London luxury home purchases in 2010, but that share declined steadily in the following years before starting to pick up in 2019.

The increased interest came as mass protests rocked Hong Kong, accelerating after a political crackdown by China, which imposed a new national security law at the end of June. In response, the U.K. said it would allow almost 3 million holders of so-called British National (Overseas) passports to move to Britain. That’s helped make the U.K. the biggest draw at property exhibitions in Hong Kong, according to property app Soho.

“Unlike wealthy buyers from the Middle East or the U.S, Hong Kongers are probably looking to relocate permanently to the U.K.,” Camilla Dell, managing partner at Black Brick, said in an interview. “There will be potential for more buyers as a result of BNO holders being told they’re welcome with open arms.”

Hong Kong buyers are drawn to London by its comparatively cheap prices. The average value of prime London homes was $1,830 per square foot in June, compared with $4,440 in Hong Kong, according to Savills Plc. They also benefit from the exchange rate. Since the peak of the market in 2014, buyers with Hong Kong dollars have reaped a relative discount of 40%, twice the price decline in pound terms, Liam Bailey, Knight Frank’s global head of research, said in an emailed reply to questions.

While London’s luxury market is struggling, the country’s housing market as a whole is on the up, stoked by government support programs that are part of its efforts to restart the economy. The spike in Hong Kong buyers’ interest is also a response to changes in the U.K.’s sales tax on property purchases. A temporary tax break will expire in March, while a new higher rate on overseas buyers kicks in the following month.

“Buyers from Hong Kong are driving the luxury residential market in London at the moment,” said Kathrin Hersel, property director at Almacantar, a developer and investor whose inquiries from Hong Kong have more than doubled since mid-March from the year-earlier period. And in recent months, they’ve started to take a longer-term view of the market.

“A year ago we were probably taking more inquiries for rental investments,” Hersel said. “Now these buyers want second homes.”

Will the pandemic bring high rise service charges back to earth?

By Antonia Cundy and Hugo Cox

After one of his lectures at the Bartlett School of Planning in London, Peter Rees was approached by a student who was surprised when the professor did not recognise him. “He said to me: ‘My parents bought six apartments in the block where you live, but I’ve moved somewhere better now,’ so that put me in my place.” The City of London’s former chief planning officer did not mind the snub to where he lives — a 1,000 sq ft flat on the 27th floor of The Heron. But the anecdote is a telling example of how quickly once sought-after high-rises can be upstaged by new super-luxury developments. “Developers started thinking: ‘OK, how can we raise the bar?” says Chris Graham, a marketing specialist in luxury homes. “As opposed to just the standard things — the swimming pool, the wellness spas — they’ve started adding golf simulators, private cinemas, wine tastings, private entertaining spaces, a hobby room, and so on.”

As the supply of super-luxury homes has increased in recent years, developers have been locked into a race to outdo one another to attract buyers. But with costs escalating — and Covid-19 putting a damper on shared facilities — will residents still want to pay for them? For the upkeep of the building and its gym, pool, private cinema, and members’ club, as well as the 24-hour concierge team, Rees pays an annual service charge of £10 per sq ft. This is cheap compared with London’s priciest spots. At the Four Seasons Residences on 20 Grosvenor Square, residents pay £14 per sq ft for perks including a supervised children’s playroom, library, pool, a wine storage and tasting room and a network of car lifts to deliver residents’ vehicles to the deep-basement parking.

A decade after it was built, the service charge on a £30m, three-bedroom apartment in One Hyde Park, Knightsbridge, is £22 per sq ft — or £55,000 per year. Managed by the adjacent Mandarin Oriental hotel, it has underground parking, wine cellars, an “ozone” swimming pool (which uses O3 as a disinfectant), a squash court and golf simulator. Buyers have been “astounded” at the asking prices of these new luxury flats, says Roarie Scarisbrick, a partner at buying agent Property Vision. As for their service charges, he estimates that the going rate for London’s best spots is now £15-£20 per sq ft. Manhattan’s top-priced buildings command similar fees. At 432 Park Avenue, a 426-metre skyscraper overlooking Central Park, the amenities include a golf simulator, a private restaurant, multiple cinemas, a billiards room and a library — and, when the building was first finished, cost residents an annual $27 per sq ft in service charges. At 35 Hudson Yards, where the first homes went on sale in March 2019, the charge is $35 per sq ft per year — which may be Manhattan’s priciest, according to data from GS Data Services in New York.

Mounting maintenance costs

The rise in decadent amenities is not the only force driving service charges. Glass facades — common among today’s high-rise luxury towers — can make for high-energy costs and maintenance bills. The glass “skins” typically comprise a series of double-glazed floor-to-ceiling windows with strengthening laminates that can form the complete exterior. Rees estimates that these must be replaced every 40 to 60 years, at huge cost and major disruption, since residents must be temporarily rehoused. “Effectively you’re taking the walls away,” he says. “You’d need to rehouse the residents for 12 months at least. How do you compensate them?”

“While buyers of office buildings factor the costs of such re-cladding work when they come to price a building, residential buyers typically do not,” says Simon Sturgis, founder of Targeting Zero, a sustainability consultancy in London. Rees reckons the high costs associated with this work mean many of the new high-rise glass-fronted apartments may have a shorter life than the leases of the apartments they contain. “From the leaseholder’s perspective they may have a depreciating asset, not in the short term, but in the future,” he says. “We’re talking about this conflict of 125-year leases in buildings where major parts of it only have a life of 65 years.” If the management companies responsible for running the buildings find themselves underfunded for such work, the result could mean large and sudden hikes in service charges when work is needed, he adds.

The cost of Covid-19

The arrival of coronavirus has further complicated matters as developers try to create buildings that are virus-safe.

“More elevator cores, wider corridors and doorways will help alleviate congestion but will increase cost and reduce usable residential space,” says Riyan Itani of Savills’ International Development Consultancy in London. “Developers will also need to consider how they can manage the density of usage through safety checks and implementing air filtration systems indoors.” Social distancing is curtailing the use of communal facilities. Regulating the number of swimmers in the pool is one of many new tasks of the top-end concierge manager; Itani reckons temperature checks could soon be added.

As Covid reduces the appeal of luxury apartments with shared facilities, developers in Hong Kong are increasingly experimenting with pay-as-you-go for core amenities such as gyms and pools, says Aradhana Khemaney of Savills’ Hong Kong office. “Not all residents want to use all of the facilities on offer,” she says. “Especially at the moment.” According to Camilla Dell, founder of buying agency Black Brick, London buyers are deserting luxury high-rises for their own four walls. “In the pandemic some weren’t even able to use those gyms and facilities but were still paying these charges,” she says. “In the world [post-Covid] the idea of sharing facilities really doesn’t appeal now.”

Luxury living costs all under one roof But some fans of all-in luxury apartments disagree. In Singapore, owners of apartments at the Ritz-Carlton Residences in the Orchard Road district enjoy perks including tennis courts, two swimming pools, a library, three sky terraces — one featuring a manicured maze — as well as the usual fitness centre, coffee bar and hosting spaces. The price to residents is about $7.70 per sq ft a year. Plus, as freeholders rather than leaseholders, residents have control over how the building will be maintained.

Edward, who did not want to give his last name, a local who lives with his family in a top-end apartment block in Singapore’s Marina Bay, says that Covid-19 has done nothing to dent the appeal of his building’s facilities. “The day after government lifted social-distancing restrictions, the pool was full,” he says. Tot up all the additional expenses of living a life of luxury in your own house, meanwhile, and service fees may look like good value. “If they were living in a standalone home somewhere, they may require a house manager who might be on £55,000, a driver might be on £30,000, a childminder might be on £50,000,” says Gabriel York, co-chief executive of Lodha UK, the developer behind 1 Grosvenor Square, where the average home is between 3,500 and 4,000 sq feet, and the service charge is £15 per sq ft. For overseas clients with children at boarding school, a member of Grosvenor Square’s team will drop off and collect the child, for example. “In one of these developments their requirements for these household staff would be reduced,” he says.

Scarisbrick says that the convenience of lock up and leave will always ensure buyers will stump up hefty service charges. “The people who are buying these places simply don’t want to deal with the responsibility of their own house, they desperately want the security and convenience of these places.” For this group, the economics of fast-ageing glass and steel buildings may be less of a concern. Even Rees is sanguine. “At my age, having paid off my mortgage, if the thing depreciates it’s not the end of the world, to be honest.”

Welcome to Beijing-on-Thames — China’s super-rich buy up prime London

By Carol Lewis

The capital is now the world’s most popular investment destination for the Chinese

The Bryanston, overlooking Hyde Park, is a popular development with Chinese investors.

“We used to call London Moscow-on-Thames because of all the wealthy Russian buyers, but now agents are calling it Beijing-on-Thames,” says Jeremy Gee, a London estate agent.

“We are all looking at employing more staff who speak Mandarin and Cantonese, and since the lockdown ended, flights to and from China have risen dramatically. Over the last few weeks we have had a dozen deals in the pipeline from buyers from both mainland China and Hong Kong,” adds Gee, who is the managing director of Beauchamp Estates.

Last week Gee sold a £2 million two-bedroom pied-à-terre at 22 Buckingham Gate to a young Chinese businesswoman from Guangzhou and helped a wealthy financier from Shanghai with a budget of £25 million to look for a London base.

A two-bedroom apartment at 22 Buckingham Gate was sold to a Chinese businesswoman for £2 million by Beauchamp Estates in June.

“What’s interesting for us is that he’s shrewd. He’s not just looking at the usual locations, such as Knightsbridge and Belgravia, but he’s been far more interested in looking around at locations such as Covent Garden, Whitehall, Midtown and Fitzrovia, and St John’s Wood,” Gee says.

“When the Russians used to come in looking for trophy properties they were really only interested in Knightsbridge, Mayfair and Belgravia. The mainland Chinese and Hong Kong buyers tend to be far less postcode snobs. Yes they want something good, but they also want bang for their bucks and to max their investment.”

Last year 49 per cent of sales in prime central London areas such as Mayfair, Belgravia and Knightsbridge were to international buyers. Mainland Chinese buyers made up 7 per cent of these and Hong Kong Chinese 6 per cent. This compares with 36 per cent from Europe, 23 per cent from the Middle East and only 2 per cent from Russia — down from 12 per cent in 2011, according to research by Hamptons International.

Office for National Statistics (ONS) data shows that Hong Kong and mainland Chinese buyers invested £7.69 billion in London property, including more than £750 million in residential property in the central neighbourhoods of Westminster and Kensington & Chelsea last year.

About 98,725 London properties are believed to be owned by Hong Kongers and 120,250 by mainland Chinese, making London property the most popular investment destination for Chinese capital in the world, according to Beauchamp Estates.

A six-bedroom penthouse in Belgravia Gate was the biggest sale of 2019 when a young millionaire from Hong Kong bought it for £65 million (Beauchamp Estates).

This year there has been a surge of interest from mainland Chinese and Hong Kong buyers off the back of the political situation in Hong Kong and the visa offer from Britain. Often, though, the distinction between the two groups is opaque, with many wealthy Chinese bringing their money out through Hong Kong.

Many high-end estate agents have employed Cantonese and Mandarin speakers to help with the influx of buyers, with many of the Chinese inquiries — and sometimes deals — conducted via Wechat, the Asian equivalent of Whatsapp.

Several high-profile sales are believed to have been to Chinese or Hong Kong buyers in recent months, including the sale of a townhouse on Cambridge Terrace near Regent’s Park for £104 million by the property developer Christian Candy to a Chinese buyer last month and the sale of 2-8a Rutland Gate, overlooking Hyde Park, in January for £210 million to Cheung Chung-Kiu a Hong Kong-based Chinese billionaire — the biggest property sale of the year so far.

Mark Pollock, the director of Aston Chase estate agency, says: “Mainland Chinese buyers have been a significant presence since the Russians stepped back, and they haven’t gone away despite the cold water between our two governments. They tend to be looking for investment properties and second homes — very substantial second homes. They also tend to be very reserved and often come with a property finder in tow.”

Camilla Dell, the managing director of Black Brick, a buying agency, says that she has been approached by a “fixer in Dubai who was looking for property for a Chinese buyer in Hong Kong”. Restrictions on currency exchange mean that many wealthy Chinese have become adept at moving money around and often have global connections.

Guy Bradshaw, the director of UK Sotheby’s International Realty, is on the verge of doing a £9 million deal with a client “who is a Chinese buyer whose money is coming through Hong Kong. A lot of wealthy Chinese had business interests in Hong Kong and they are now re-evaluating their position.”

The majority of Bradshaw’s deals with Chinese buyers are done via Wechat, including one for a £600,000 new-build apartment last week for a businessman who is relocating from China to London for work.

“Traditionally they looked for very modern apartments, and often still do, but one I sold recently was a very traditional Victorian house. It was in immaculate condition. The Chinese love our history. Anything near Buckingham Palace or owned by the big estates, like Grosvenor, is popular. But they will travel — Oxshott in Surrey is also popular — and farther afield,” Bradshaw says.

Chinese property billionaire Cheung Chung-Kiu, who owns Hong-Kong listed CC Land, paid £210 million for the palatial 45-bedroom 2-8a Rutland Gate, Knightsbridge, in January. It is the biggest deal of 2020, so far (Beauchamp Estates).

Popular locations for homes in London include the northwest suburbs of Hampstead and St John’s Wood, including Avenue Road, where Sotheby’s International Realty has a mansion for sale for £75 million and where at least four homes are believed to be owned by wealthy mainland Chinese, and nearby Elsworthy Road.

New developments attracting Chinese buyers include the Bryanston overlooking Hyde Park near Oxford Street, One Grosvenor Square (where a Chinese businessman is understood to have paid £110 million for the penthouse in 2018), Clarges near Hyde Park, and Hanover Bond in Mayfair, which has branded residences by the Mandarin Oriental.

Peter Wetherell, the chief executive of Wetherell, a Mayfair estate agency, says: “It tends to be Chinese people who have got their money in the international system, which makes it a bit tricky sometimes to separate Chinese and Hong Kong buyers. The change is that they are not just buying for investment any more. Chinese and Hong Kong buyers are looking for trophy homes, and the visa offer and stamp duty change has helped create momentum.”

The chancellor has raised the threshold for stamp duty from £125,000 to £500,000 until March 31 next year. The government has also said that it plans to introduce a 2 per cent levy for non-British buyers, in addition to the existing 3 per cent second-home charge.

Traditionally Hong Kong buyers have been associated with new-build investment properties in locations such as Kings Cross in north London, Nine Elms in south London and Canary Wharf in east London, as well as university towns such as Manchester, Birmingham, Leeds and Liverpool. Now it is not just the wealthy, but a wider range of buyers looking for homes they can move to, should they need to leave Hong Kong.

When Middle Eastern and Russian buyers first arrived in London in the early Noughties they were often derided for their love of gold taps and backlit onyx. Today there is a more generic international palette, although some describe the new wave of Chinese buyers derisively as “opulent” and “new-money”.

The influx of Chinese and Hong Kong buyers could mean a greater emphasis on feng shui — the practice of designing to miximise the flow of energy through a property — in British developments.

Dara Huang, the founder of Design Haus Liberty, a design and architecture firm says: “Chinese buyers hold on to the principles of feng shui, so homes with square or rectangular floor plans are a must, to bring balance and harmony for the whole family. It is important for good energy to be able to flow throughout the home.

“Our team from Hong Kong get specialist training in feng shui to service our clients better, which is probably an afterthought for other companies. When we are designing we have a master of feng shui assisting. Proximity to water is still super-important to Chinese buyers too. Water is said to hold on to chi in feng shui, so overlooking a river, lake or even having a pool is very desirable.”

Although she adds: “Things to avoid include the number four as it is considered unlucky. So the fourth floor, door No 4 are usually a no-go.”

Analysis: how will the stamp duty holiday affect the housing market?

Will the stamp duty holiday boost sales and house prices?

By Martina Lees

We’re not going on a summer holiday, but — as Cliff Richard didn’t sing — at least we’re getting one on stamp duty. Will that boost a recovery in the housing market?

Despite an all-time record of 8.5 million visits on the Rightmove site the day after the chancellor announced the tax break, the answer is far from simple.

Most economists expect consumer confidence to dip towards October, when the government is planning to stop paying the wages of furloughed workers and mortgage holidays are due to come to an end. Then there will be more uncertainty over the risk of a no-deal Brexit as Britain’s transition deal with the EU ends in December.

The stamp duty break is going to be valid until March 31, 2021 — far longer than originally anticipated — and is being timed to reduce the impact of unemployment and economic uncertainty on the housing market.

Announcing the measure, Rishi Sunak pointed out that housebuilding supports almost 750,000 jobs, but that “property transactions fell by 50% in May”. He went on to say: “House prices have fallen for the first time in eight years, and uncertainty abounds in the market . . . We need people feeling confident — confident to buy, sell, renovate, move and improve. That will drive growth.”

According to a forecast from the Centre for Economics and Business Research (CEBR), the policy will lead to a 6% rise in property transactions — that’s 41,000 extra sales — over the next nine months.

However, Jon Bell, a housing analyst for Deutsche Bank, warns that while the measure will push up sales temporarily, this will come to an end when the holiday period finishes in March. He explains: “For petrolheads, this is a jump-start, rather than a new lithium battery.”

Bell also points out that the policy won’t actually make much of a difference to prices. For example, a home mover buying a £250,000 property would save only £2,500 (1%) of the price in stamp duty. The buyer of a £500,000 home would save £15,000 (3%), with the relative saving falling above that level.

An HM Revenue and Customs study has also shown that a two-year stamp duty holiday from 2010 for first-time buyers on homes under £250,000 only ended up pushing up house prices by 0.5-0.7%. And buying a house is such a significant financial decision that in times of uncertainty “not many people will commit before the outcome is clearer,” says Jamie Durham, an economist at the consultancy PwC.

The CEBR is forecasting a 5% fall in house prices this year and a further 10.6% drop in 2021 before they start rising next autumn. Pablo Shah, its housing economist, predicts a slow property price recovery in the shape of a “Nike swoosh” — as do Bell and Durham.

“Unlike previous economic crises, it’s not founded on structural imbalances in the housing market. We expect prices to recover as people’s incomes recover,” Shah says. “We’re not expecting any kind of boom.”

At least one non-economist disagrees. Rob Bence, the co-founder of the Property Hub investor podcast and forum, has made his boldest prediction in seven years of broadcasting: “We’ve never had this much financial stimulus injected before.

“We won’t just head into a recovery, we’ll be pushed into an almighty economic boom . . . It won’t happen immediately, but it’s coming. When the boom comes it’ll be at a scale we’ve never seen before.”

Lu believes that this view is overly optimistic, but Andy Haldane, the Bank of England’s chief economist, has claimed Britain is on track to rebound faster than expected — in a V-shaped recovery.

Ultimately the stamp duty cut should boost jobs for housebuilders, estate agents and conveyancers — and even homeware shops and garden centres, if buyers spend their savings on a sofa or an outdoor dining set. However, Bell warns that the cut is “best seen in the context of an 86% year-on-year fall in mortgage approvals in May” — a worrying sign for future volumes.

Does a stamp duty holiday go far enough — or should we abolish it altogether?

By Hugh Graham

Abolish stamp duty. It has been the mantra of high-end estate agents ever since the then chancellor George Osborne introduced reforms of stamp duty land tax (SDLT) in 2014, which made buying a house cheaper for purchases under £937,000 — 98% of households — but more expensive in Mayfair. Even after last week’s stamp duty holiday was announced for purchases under £500,000, Home’s inboxes were full of emails from top-end agents saying Rishi Sunak did not go far enough.

Take Enness Global, a high-net-worth mortgage broker. It argues that although buyers in prime central London — where the median sold price is £4.92 million — will save £15,000 under the new reforms, buyers on a £14.1 million home will still pay £1.6 million in tax. “High-end homeowners certainly won’t be getting any richer thanks to Rishi,” says its chief executive, Islay Robinson. “This archaic tax continues to leave a bad taste in the mouth of prime buyers. It’s about time this government money-grab was abolished completely.”

Trevor Abrahmsohn, director of Glentree International, an estate agent in north London, argues that ever since Osborne’s 2014 reforms, “transaction numbers have been reduced by 70%, and the cost to the Treasury has been between £5 billion and £12 billion in lost taxes”.

These industry arguments have become so pervasive that they have filtered into the mainstream. Andrew Pierce, a journalist, said on Good Morning Britain this week: “When George Osborne was chancellor he massively increased stamp duty, and what happened? Less money came into the Exchequer.”

However, the claims of lost revenue are a myth. New figures from LonRes, a property data company, reveal that HMRC’s stamp duty receipts have been higher every single year since the reforms were introduced in December 2014, by at least £1 billion annually. Before they were introduced they stood at £6.45 billion for 2013/2014. For the year ending 2019/2020, ending March 31, they stood at £8.39 billion.

It is true that transaction levels above £1 million fell 30% between 2014 and 2019, according to LonRes. Abrahmsohn argues that the lower activity at the high end reduces other revenues such as pay as you earn, VAT, capital gains and corporate tax, but doesn’t have figures that show this reduction is significant enough to offset the government’s increased stamp duty revenues since 2014.

Camilla Dell, founder of Black Brick, a London buying agent, would welcome tax cuts at the top end, but is resigned to the status quo. “I can’t see it happening politically. They’d be accused of being a party for the rich when they are trying to help the north. Sunak’s reforms gave my buyer on a £2 million flat in St John’s Wood an extra £15,000. I think this is as good as it gets for us.”

Henry Pryor, a buying agent, is one of the few agents to defend George Osborne’s 2014 reforms, saying the higher rates stopped double-digit house-price inflation in Notting Hill and Chelsea, deflated a bubble and helped 95% of buyers. “Osborne deserves credit. The reforms did exactly what he wanted. It brought prices down.”

Times are of course very different now, but he can’t see the government scrapping or cutting stamp duty at the high end, not least because, contrary to what many agents say, SDLT is still a cash cow for HMRC. “I would imagine the government has done its sums. Sunak’s policies helped 90% of the people, but the Treasury is enormously dependent on the top end for revenue. Something like 45% of the SDLT revenue comes from the £1 million-plus market. We need some of these deals so we are at least getting some revenue.”

Come on, super-prime buyers: splash out to help out.

Forget the gloomy market data – it’s a bunfight in some parts of London…

The headline figures may show prices falling, but the reality is that buyers in many prime areas are facing stiff competition for anything decent, warns Black Brick.

There’s very little similarity between the market data and what’s actually happening on the ground right now, a PCL buying agency has warned those winding up for a low-ball offer.

Black Brick suggests purchasers would do well to “disregard” the average price falls being reported in the press, as these are being driven by discounting on large new-build developments or properties in less desirable areas or even streets – and are also based on limited data (transaction volumes have been running at 55% below average, according to HMRC).

The reality is, says the firm, that certain types of properties in prime London remain very much in high demand, and forced selling has been minimised by low interest rates and government support schemes – as such, hopes of securing a chunky reduction on anything decent are fanciful…

Camilla Dell, managing partner: “There’s a big gap between what the market analysts are saying about falling prices across London and what potential buyers of high-quality properties in the best areas are finding. Buyers were led to believe during lockdown that prices would come off – in many cases, that’s simply not happening.

“Those sellers that are in the market are not desperate…There’s a real Mexican standoff.”

Many buyers have been holding fire for two or three years and are desperate to move, added Caspar Harvard-Walls, a partner at the firm: “If you’re looking in Hampstead, Barnes, or Fulham, you’re going to face a lot of competition.

“We’ve seen buyers coming in with a low-ball offer, seeing it quickly beaten, and then responding by paying the asking price or even above. Once they realise the depth of competition for good properties, it gives them the confidence to pay up.”

“Agents are rushed off their feet, but we’re not seeing the stock they are selling being replaced with new instructions: there could be a real squeeze come September.”

However, predicting the future trajectory of the market is proving tricky, said Dell: “There’s still the risk of leaving the EU without a trade deal, taxes will have to go up to pay for the Covid response, Stamp Duty for foreign buyers is going up next April, while limits on international travel will keep many overseas buyers away. It’s really hard to form a medium-term view on the market’s direction.”

Have London’s new homes lost their lustre?

By George Hammond

Coronavirus is cooling sales of luxury new-build properties in the UK capital

Bargain hunters have arrived in London’s luxury new-build property market in the wake of the coronavirus pandemic. Camilla Dell, a London-based buying agent, has just taken on a client with £250m to spend. But instead of a single trophy home, they are investing in a few hundred one and two-bedroom newly built flats. This type of new home tends not to sell to owner-occupiers, according to Tim Craine, head of research at Molior London, which monitors the property market. “Twenty years ago, if someone was building a development scheme they would be really happy to sell one a week to a couple with a baby,” he says. Nowadays, “the notion [that] it’s a normal market selling to normal people doesn’t exist.”

Instead, he says, many brand-new homes — particularly those at the higher end of the market — are sold in bulk to investors and end up on the rental market. Dell’s client, an overseas investor, is one of them. They are hoping to buy about 250 apartments for roughly £1m each from developers who are keen to shift them quickly and are likely to do so at knockdown prices.

But while the pandemic has created opportunities for investors to buy new luxury flats, agents say it has driven away those wanting to live in them. So what is the outlook for London’s new-build homes?

Luxury flats are selling slowly –

The capital’s luxury new-build apartment market has cooled in the past five years, partly because of tax hikes on second homes and partly because of uncertainty surrounding Brexit. In Zone 1, where the most expensive properties are clustered, flats are selling at the slowest rate since 2011, according to Molior. At the current rate — 566 sales across all price brackets in the first three months of the year — it would take three years to sell all the completed flats in central London. Coronavirus threatens to cool the market further. Confidence has been shaken by the pandemic and, post-lockdown, data from property portals show that buyers are increasingly searching for homes in suburbia or further afield. “It was once a plus having the shared gym, spa, swimming pool and concierge,” says Dell. “In a world with a pandemic they might think twice and want to buy the freehold on a newly refurbished Mayfair town house instead.” Andrew Griffith, managing director of MyLondonHome estate agents, says one of his customers is pulling out of the purchase of a new-build flat to buy a house in Hampstead instead — cutting their losses and leaving a £110,000 deposit behind. “A number of buyers no longer want to complete [on new-builds] and just want shot,” he says.

Overseas buyers looking for homes for their children studying in London are another group he sees pulling back. Individuals from overseas accounted for about 6 per cent of total sales in the first quarter of the year, according to Molior. On a per-square-foot basis, new-build homes tend to be significantly more expensive than older properties in the same area, no matter how grand the latter. MyLondonHome is selling a three-bedroom apartment at Marylebone Square, a new development in central London. The property is 1,938 sq ft and costs £6.2m. A short walk away, on Upper Montagu Street, Knight Frank is selling a four-bedroom Georgian town house that has been newly refurbished and measures 2,623 sq ft for £4m.

A tough assignment –

Griffith’s company specialises in selling new flats for people who have committed to buying them from a developer, but have decided to pull out. The process is known as assignment, because it involves assigning the right to complete a purchase from one buyer to another. The original buyer will typically have made an offer on a property before it was built, having seen a brochure. When prices rise fast, as they did in London from 2009 to 2014, speculative investors put down deposits on unbuilt homes and, with luck, sell for a profit before the dust settles at the building site. But with London’s priciest homes having lost more than 20 per cent of their value since 2014, according to Savills data, the speculators are gone. Now the process has reversed, with contracts often being reassigned for a loss. A substantial portion of sales now are to corporate landlords who will put them on the rental market, or “flats sold halfway through [construction] to a fund”, says Craine.

According to Molior, of the 6,000 or so new-build homes sold across the whole of the capital in the first three months of this year, more than a third were sold to so-called build-to-rent operators — corporate landlords who rent out the flats to private tenants. There are some individuals who are still keen to invest in London property, however. “There is good interest from Hong Kong,” says Griffith. “[Buyers] want to get money out and London is the obvious choice — they tend to be in the market for new homes.” The Asian financial hub has long been a staging post on developers’ global sales tours.

A favourable Hong Kong dollar exchange rate and a fall in London prices mean the UK capital looks attractive for these buyers. Many want to move money out of a city on which China has recently tightened its grip with the imposition of a national security law, say agents. “Some overseas buyers are buying at a 40 per cent price drop [from the 2014 peak], ” says Rory Penn, head of Knight Frank’s private office. While the market has generally been slow, what interest he has seen has come predominantly from Asia. “If you’re buying from £10m-£100m and you can get 40 per cent off, it’s pretty compelling,” he says.

Is it the time to negotiate hard?

Some buyers will be compelled to buy new-build properties if they think they can secure a good discount. Whether there will be enough to soak up the supply is another question. In 2014, demand for new-builds was so strong that just 139 completed apartments were unsold across London. Last year, that figure was 3,829, according to Molior. Developers have pulled back in response. Work started on more than 15,000 new inner London homes in 2015, and on just 6,000 last year. But there are pockets of the capital where the supply taps have not been turned off. According to Buildington, a database of London developments, there are close to 1,000 projects in the pipeline, more than 200 of which are expected to complete this year. Some of the priciest are in Canary Wharf. The 239-metre-tall Landmark Pinnacle alone will bring more than 750 apartments to market this year, with a starting price of £425,000.

There are still thousands of new homes in the works at Nine Elms, on the south bank of the Thames, one of London’s biggest development hotspots. At some London schemes, lenders have put pressure on developers to sell, according to Charles McDowell, a central London estate agent. That may mean opportunities for buyers looking to negotiate hard. But anyone trying their luck will be competing with investors such as Dell’s client, buying now in the hope they can draw rental income at a later stage. “There are opportunities out there,” says Griffith. “People are expecting to see prices go down — the only question is by how much they will come down — not if.”

Major cities may still want to look to international buyers

By Virginia .K. Smith

Tumultuous financial markets and eager sellers draw investors to global real estate hubs even as local residents head for the outskirts

Between international travel restrictions and the boom in demand for single-family and vacation homes, much of the real estate industry’s recent focus has been set squarely on domestic buyers who have suddenly found themselves in need of more space.

But in certain urban markets with high levels of luxury supply—think New York, Miami, Los Angeles, and London—the current environment also presents an opportunity to court buyers from abroad. This is particularly true of buyers from countries that have already passed the worst of the coronavirus crisis.

“I’ve personally sold three homes, sight unseen, to Chinese investors during the pandemic,” said Mauricio Umansky, founder of The Agency in Los Angeles. “There’s certainly a perception among international buyers that now is a good time to buy U.S. real estate because it’s ‘on sale.’ Any time there’s a drop in the market, you see outside investors wanting to put money into the U.S., because it’s still the strongest market.”

Potential price cuts aside, the appeal of a safe investment outside of the volatile financial market can also prove a powerful incentive for buyers looking to diversify their international portfolios.

“We started following markets that were emerging from the virus as we were going into it—South Korea, Mainland China, Portugal—that all had strong markets in early April,” said Nikki Field, a senior global real estate adviser with Sotheby’s International Realty in New York. “We focused on our wealth adviser contacts there to let them know there was opportunity in New York.”

And while many local buyers in New York City have been headed for privacy and acreage outside of the city, for international investors focused on eventual resale value, the condo market is still king.

Investors “want prime luxury condo new developments, because that’s the biggest opportunity for long term return,” Ms. Field said.

All of which means that sellers hoping to offload luxury condos may want to turn their attention outside U.S. borders—and that for would-be investors, now might be the time to get a foothold in major cities while other buyers are distracted by the suburbs.

Buyers Are Seeking Out Signs of Distress

Though the market may not be at its low point, some investors are nonetheless treating the current moment as an opportunity to invest in high-end properties at a relative bargain.

“In Miami, we’ve seen an uptick not only from markets like Chicago and New York, but also from Europe and South America,” said Rishi Kapoor, CEO of Location Ventures, a developer based in South Florida. “Towards the middle of May, we started to see interest from some of our feeder markets in Columbia, Mexico and Venezuela, who aren’t comfortable with how their local governments have handled [the pandemic], who have always been interested in Miami and now realized they can make it work as a home base.”

The sense that there are deals to be found as U.S. markets struggle is also a significant driver of interest from abroad.

“In new development, what you’re really attracting from abroad is investment opportunities,” said Vickey Barron, a New York City-based Compass agent. “They’re looking at New York thinking, ‘why not come in now, pick up some great assets at a good value, and the market will bounce back.’”

From Penta: Future Returns: Investing in Revenue-Based Financing

For London properties in particular, the current exchange rate adds another layer of appeal for foreign buyers.

“For investors, there’s a huge advantage to [buying] the dip,” said Camilla Dell, founder and Managing Partners of Black Brick Property Solutions in London. “Central London was already down 20% from its peak [in 2014], and the pound is weak, effectively giving dollar-based buyers a 45% discount.”

“The clients I’m speaking to from overseas are looking for signs of distress, and where they can, buy cheaply,” Ms. Dell said.

Though the currency difference is less dramatic in the U.S., some investors are making a similar calculus for purchases stateside. “We’ve had such a strong dollar for so long that when there’s any little hole in the marketplace, where foreign buyers sense they can catch up, they’re jumping in,” said Dora Puig, director of sales at Palazzo Della Luna, a development on Fisher Island in Miami.

More: Buyers Eyeing South Florida Should Consider Broward County for Good Returns on Investment

Developers Tailor Deals to Investors’ Bottom Lines

Buyers shopping cities for deals might not find especially large price chops, but they are likely to be able negotiate more favorable terms on payment plans, monthly maintenance, and other assorted extras that are geared towards investors who are keenly focused on overall cost and thus willing to negotiate for concessions outside of the asking price.

“Everybody is asking for the ‘COVID discount,” said Gil Dezer, president of South Florida-based Dezer Development. “We’re not lowering prices, but we’re doing value adds—we might pay maintenance, we might do a flooring package for somebody. We don’t want to affect the values of the buyers who have already purchased, so those little add-ins can usually make the deal.”

Essentially, any offer that shifts expenses from the buyer to the seller is fair game.

“I’ve seen developers sell apartments furnished, or give big credits at closing for interior design because they want to [get the deal done],” added Ms. Puig.

More: Los Angeles’s Historic Homes: A Tried-and-True Investment Even in a Time of Uncertainty

In New York City’s market, where luxury prices had already deflated over the past few years, discounts aren’t growing much beyond a few percentage points, Ms. Barron said. “We already did our work adjusting prices prior to the lockdown, but you could make an argument [as a buyer] that you don’t want to pay maintenance for services you can’t use right now, so the building should pick those up for the next 12 or 24 months.”

“The more courtesies the developer offers, the higher the transfer price,” Ms. Field said. “So it’s not just 35% off the asking price, it’s 35% off the complete cost. [Covering] the mansion tax, finishing closets, doing painting or modest renovations, crediting back many months of common charges, all at the developers’ cost. Those aren’t recorded, but the transfer price is obviously higher, and the credits are deeply attractive to buyers.”

In new developments, deposit size has also become a common point of negotiations. “Many developers have reduced the levels of deposits needed to purchase a property here,” said Edgardo Defortuna, president and CEO of the Fortune International Group, a Florida-based developer. “They used to request 50% deposits throughout construction, and in many cases it’s now 30% or 35%.”

More: Amid the Covid-19 Crisis, Single-Family Homes May Be the Smart Investment

Due dates for deposits have also become more flexible to allow time for buyers who may have difficulty traveling under current restrictions to see a property in person before taking the plunge, Mr. Defortuna said.

However, for investors specifically in search of deals, the time frame for finding major discounts could be deceptively brief, as urban markets begin to regain momentum and competition from other foreign buyers increases.

“International buyers that are coming late into the fold are not being afforded as eager, immediate deals as they were just a month ago,” Ms. Field said. “The window of opportunity is short.”

How to play the pandemic property market and buy a bargain

By Melissa Lawford

Agents are reporting a sales surge, while analysts are forecasting imminent price falls. Is there a way to make the most of the difference?

The property market is on a rollercoaster: while agents have reported a surge of demand and deals since restrictions were lifted in England, analysts have forecast deep price falls this year.

So is there a way to take advantage of these peaks and troughs?

One way to do that is sell up now, while the market is in a frenzy, then rent while biding time as prices fall – and then snap up a bargain.

This is what Theo Taylor, 71, plans to do. He has lived in Hemel Hampstead, Hertfordshire, for 20 years with his daughter and his wife, who passed away last year. Before coronavirus hit, he was preparing to downsize to Wiltshire with his dog, Pebbles.

“Now, I’m thinking of selling this year as planned, trousering the cash, renting in Wiltshire and then buying over the next year with the added leverage of being a cash buyer,” he said.

e is about to put his house on the market for £765,000, and intends to move west with a budget of £600,000 to £650,000. He wants to wait until he finds a home that he really wants, and then will be able to move quickly.

But he could benefit from falling house prices, too. “I think prices are going to fall,” said Mr Taylor. “The furlough scheme will end soon, and when it does I think there will be significant redundancies and business closures, and when that happens I think the property market will go down.”

Is now the best time to sell?

Buyers have rushed back into the market in England since the restrictions were lifted. Agreed sales are nearly at pre-lockdown levels and sellers are so optimistic that in May, asking prices were 1.9pc higher than in March, according to property portal Rightmove.

David Ruddock, of estate agents Carter Jonas, said that while pent-up demand is driving the recovery, it is not just rooted in lockdown. “It has been building since the middle of last year, long before the pandemic began,” he said. Buyers had been holding off since the June 2016 referendum to see what would happen with Brexit and were just starting to return to the market after the decisive Tory election victory brought more clarity in December.

There is also a new group of buyers who have become dissatisfied with their homes during lockdown, said Mr Ruddock.

But the effects of the coming recession have not yet filtered into the market. Nine million people currently have their wages supported by the government and one in seven mortgaged households are currently protected by a mortgage holiday. When these measures end in the autumn, there could be a spike in forced sellers, and a major hit to buying power.

Lenders are certainly expecting the recovery to have a short life expectancy. The building society Nationwide has forecast a 13.8pc drop in house prices and has withdrawn mortgages to buyers with less than a 15pc deposit accordingly.

The current huge level of demand and the pessimistic outlook suggest that now may be the best time to sell for some time.

How will price falls vary across the market?

These forecasts are largely for the UK as a whole, but there will be major differences in house price changes across the country and at each stage of the property market.

The entry-level section of the market will likely be worst hit, said Mr Ruddock. First-time buyers are most likely to be affected by redundancies. They are also most reliant on the availability of lending, and mortgages for those with small deposits are scarce. The number of agreed sales at the lower end of the market is not recovering at the same rate as those of prime homes.

Meanwhile, values in rural areas are more likely to hold their value. The markets here are less vulnerable to changes that affect buy-to-let investors and overseas buyers, who are currently held back by travel restrictions and face a new stamp duty charge. Affordability here is already better than in the cities, and rural markets will benefit from new demand for homes with outdoor space.

Camilla Dell of Black Brick, a buying agency, said: “A lot of people want to move out of London now that they can work from home.”

In the capital, “the market has already dropped,” she added. “The deals we had agreed pre-Covid have been renegotiated by about 5pc.” Large-scale new build developments will be particularly vulnerable to further falls.

When will price falls bottom out?

“Playing the market is a risky strategy, as timing the bottom of the market is something nobody can predict,” said Ms Dell. “I think we are looking at a few months.”

Estate agents Savills and Knight Frank have both forecast that house prices will return to growth in 2021.

The housing market’s recovery will be closely tied to the UK’s economic strength. But the relationship between the two is not necessarily always one of cause and effect. Analysis by Deutsche Bank showed that during the global financial crisis, GDP started to fall in March 2008 and bottomed out in June 2009 – a gap of 15 months. Meanwhile, house price falls started earlier in September 2007 and lasted for a longer period of 18 months.

In this case, however, GDP has fallen first, with a plunge of 20pc in April; perhaps this time around, an eventual rise in GDP could be a precursor to a house price recovery.

But even if a buyer calls the market right, they could be held up by a lack of available homes, said Ms Dell. When a market is falling, sellers are also less keen to list their properties, meaning that pickings are slim.

“It is a bit like going to the Harrods sale,” said Ms Dell. “Yes, the discounts are bigger, but is there anything you want to buy?”

What buyers want now: Top town & country buying agents compare notes on post-lockdown demand trends

Two top buying agents – one focused on prime London, and one on prime country houses – reveal what is on their clients’ most-wanted lists.

The Covid-19 pandemic has affected lives in many ways, and talk of property markets may seem inconsequential in comparison to some of these. But the lockdown has had a dramatic effect on the resi sector, with some potentially long-lasting shifts in home-buyer priorities.

At the top end, luxury property buyers seem to be re-assessing what they value most in a prospective new home. Space to live and work has risen up the priority list in both town and country, while location has in some instances become less of a factor.

Two top buying agents – Camilla Dell, focused on prime London, and Charlie Wells, focused on prime country houses – reveal what is on their clients’ most-wanted lists.

Mayfair-based Black Brick has been sourcing homes for wealthy and corporate clients in London and the South East since 2002. Founder and Managing Partner Camilla Dell talks us through the changes she is seeing in her clients’ priorities since the Coronavirus lockdown:

In Town: Camilla Dell of Black Brick

What’s Going Up:

Home offices. With many large corporations struggling to navigate how to bring people back to work safely, let alone get on a tube or airplane, top of the list right now is home office space. Clients want spaces where they can hide away from the kids, ideally with sound-proofed walls, but lots of natural light and adequate space to avoid hunching over a small desk, making it a pleasant space to work for extended periods
Wifi speed. There was a time a few a years back when buyers would ask for space for large clunky servers. The use of the “cloud” and technology like Office 365 negates the need for large servers with air conditioned units to keep the room cool. Whilst tech has moved on, fast wifi speed is still critical.
Basements / cellars. We’ve become accustomed to working out by ourselves with an online class or 1:1 personal trainer on Zoom. So many buyers are happy to convert a basement or cellar into a personal gym. Clients are also asking for space to consider building a swimming pools, sauna and spas
Gardens with space for veg patches. A big trend for those with gardens and some extra time on their hands, is buying and planting veg. Over recent months, many have valued self-sufficiency, showing children when their food comes from and the satisfaction of growing your own. The kitchen is evolving into the kitchen garden. And much like the premium that goes on a “starchitecht” property, gardens which have been designed by a celebrity garden designer have added cache.
Sustainability features. Clients see the benefits of developments which have recycling and waste disposal services to help control rubbish, especially where public serves have been under strain with reduced pick ups
Larger kitchens/ dining areas. Going forward, we expect people to do more home entertaining with a small “bubble” of friends, therefore space to cook and entertain will be higher up the wish list, possibly with personal chefs catering for small groups, with hygiene front of mind.
Large play rooms/ space for children to learn/ home school. Once the British winter comes and children can’t get outside as readily, space for children to play with siblings or a small bubble of friends will become the ‘new normal’ – we expect a demand for flexible spaces where children can play as they grow
Additional services. This has always been popular, but with an increase in online shopping and deliveries, a property with a concierge or housekeeping services will have added influence. We’re also seeing some developers being clever with added services such as private health care plans built into their management packages.

What’s Going Down

Proximity to the tube. The latest news from the BMA that any enclosed spaces will increase risk, means that people will be looking for alternative means of getting to work, or indeed, simply working from home more
Proximity to airport links. Similarly, the increase in remote working, will decrease the demand for international travel, so a home on the Piccadilly Line or close to the Heathrow Express will be less important
Apartment blocks. Especially those with shared facilities such as pools/gyms will become a lower priority, as people are now adept at training in their own homes

In the Country: Charlie Wells of Prime Purchase

Prime Purchase is the independent buying arm of Savills; it has been representing and advising purchasers across the country since 2002. Hampshire-based Managing Director Charlie Wells reveals what is on their clients’ most wanted list:

Number one is the general aesthetic and how the house looks – everyone wants a home they perceive to be attractive. This is where it gets tricky as tastes differ. One buyer may want a period property with high ceilings and Georgian splendour, another may want a more modest farmhouse or cottage. Some will want to preserve existing features and make the most of them, others will say they want period charm and then replace that charm with clean lines and modern finishes. It is all down to personal taste.
The need for square feet and acreage is important with buyers potentially requiring room to accommodate a hobby. The space you need and the space you want are two different things so never sell off outlying land until the main asset is sold.
Privacy and seclusion, particularly in the country, are high on the must-have list. Privacy comes in different forms, from not wanting your neighbours to see you from their upstairs study window to not seeing another house at all. For most people, it’s about not seeing anyone else and ideally not hearing them either.
Absence of blights, usually planes, trains and automobiles but also pylons and electricity wires which blight the view. However, the very presence of a blight can make a house affordable to the buyer so it’s not the end of the world to have them. Noisy neighbours tend to be highly undesirable, but it comes down to what you are used to – I live near a farm that houses 350 cattle in winter. Their bellowing and general smell is reassuring to a country boy like me but others might not be able to cope.
Train, rail and road access. Is your property an hour from the capital or two or three? Buyers have their limits whether they travel daily, weekly or occasionally. Covid-19 and homeworking will, I think, relax people’s views on a slightly longer commute in order to gain more space.
Proximity of schools, whether a good state primary and secondary, or private. Many of our overseas buyers won’t consider boarding schools and need to live near a good private school so they can take their children to school every day.
Surrounding countryside. Having quiet country lanes and a network of public rights of way for walking, running, cycling or riding have become especially important recently.
Proximity to an attractive town or large village. Most buyers want some decent pubs, restaurants, cafés and bars fairly nearby – most popular areas will already have these.
Friends, old and new. People want to be near their friends or have the opportunity to plug into a new social network for themselves and their children. Schools, pubs and sport all play a big part here.