Property Market Bounces Back After Uncertain Start

Property Market In Hythe Bounces Back After Uncertain Start To Year

By Matthew Piper Purplebricks Local Property Expert

2020 has without doubt seen some of the most challenging times in recent years for Estate Agents in the local area. With the COVID-19 pandemic rocking the market to its core in the early part of the year, agents are now experiencing record breaking sales figures making the coming months an exciting and potentially lucrative time to move.

So, what has caused this sudden upturn in business that has taken so many by surprise?

Back in March the Prime Minister, Boris Johnson, announced a full lockdown; it could not have come at a worse time for the housing market. Agents were just starting to see an improvement on a poor end to 2019, which had been mainly as a result of market uncertainty and lack of confidence related to the General Election, the Christmas period and imminent Brexit. However, with so much delay and frustration caused by lockdown, both buyers and sellers returned to the market in early June in their droves with a new insatiable appetite to buy and sell that hasn’t been seen in years.

This increased activity can be attributed to several factors, the first being The Chancellor of The Exchequer Rishi Sunak’s decision on the 8th of March to abolish Stamp Duty Land Tax (SDLT) on purchases up to £500,000 in an attempt to encourage people back to the market once more.

Many saw this as a green light to kick start their plans to move with earnest, often choosing to bring forward in some cases by several years to make the most of this rare saving.

Zoopla, a leading property market quoted that “nearly 9 out of 10 transactions are no longer subject to stamp duty with the average bill falling by £4,500”. However, with the average house price in Hythe being cited by Zoopla at £363,998, some £107,998 above the average UK house price of £256,000 (Nationwide House Price Index), many would experience far greater savings thus making already attractive Hythe properties even more appealing.

The second factor that has undoubtedly seen buyers choosing 2020 as their year of

“both buyers and sellers returned to the market in early June in their droves with a new insatiable appetite to buy and sell that hasn’t been seen in years”

choice to move is the historically low Bank of England Base Rate. On the 19th of March in line with the Stamp Duty Holiday the Governor of The Bank of England Andrew Bailey slashed the already low base rate to a ground-breaking 0.1% down from 0.25% to fire up the economy during the COVID-19 crisis. Tens of thousands took this as their opportunity to borrow money at an exceptionally low rate and flooded to the market to take lenders up on the offer of a lifetime.

The final reason behind the local market’s sudden surge in activity can be explained by people’s shift in priorities. Hythe has long been synonymous with buyers coming from out of the area, London in particular to make the most of the open spaces and beautiful coastline and this year has been no different, in fact more so. As search criteria changed and many people are spending more time at home, many are preferring to relocate to Hythe (and surrounding areas) or to purchase second homes and are now happily choosing to commute to the hustle and bustle of city life. The excellent high-speed links from Folkestone and Ashford to the capital, often available in under an hour, suggests that this trend shows no sign of slowing.

As you can see the local market now is firmly heading in the right direction again after an unpredictable start to the year with prices in October reaching a record high since 2015 with an increase of 5.8% (Nationwide House Price Index).

What is certain is whether you are looking to move now, or in the future, Hythe’s property market will always command a high price for those that are fortunate enough to live in the town we love.

I would like to take this opportunity to wish all of Hythe’s residents a Merry Christmas and most importantly a happy and healthy New Year.