3 Predictions for the property market in 2021
As we arrive in 2021, there is a global sense of optimism that the end of the Coronavirus pandemic is nearing as vaccines start to roll out. Yet at the same time, there has never been a more critical time to take the spread of COVID-19 seriously.
In the middle of the volatility, the economy is clinging on for dear life, which will undoubtedly have an impact on the property market in 2021. Below we look at 3 predictions for the property market in the coming year:
1. Buyer demand will continue to grow
Since mid-2020, the prime interest rate has been at its lowest point in decades, which continues to mean that banks are granting home bonds more readily than before. For those who have the means to purchase property, it is a great time to enter the market. As long as the prime lending rate stays low, it will drive up demand for property, meaning new buyers will continue to enter the market.
2. A struggling economy means lower house price growth
As is clear in times of economic difficulty, overall spending decreases. This is largely due to the way in which people are prioritising their needs and become risk-averse. Until the economy and social conditions improve, house prices will grow at a lower rate than is usually expected. This does not mean that property purchases are a bad investment right now, it just means buyers should not expect short-term returns.
3. Market conditions and lifestyle changes to have a strong impact on market activity
Because of low interest rates and the cost of renting properties, there has been a significant drop in the disparity between the costs of renting and buying. This makes buying a much more viable option than it was before and a shift from renting to buying can be expected. Furthermore, with the emergence of more remote work and shifts in priorities, families may be more inclined to move into a house that better fits their convenience (or budget, should they have been hit by the weakened economy).
With all that said, 2021 appears to be a year of high activity in the property market. Get in touch with us at 3%.Com Properties to take advantage of our expertise and guidance in finding the best suitable home for you in the current climate.
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This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)
05 Feb 2021
Author 3%.Com Properties