The property market evolving is nothing new, the pandemic just poses new circumstances for us to adjust to.
The truth of the matter is that over the years, buildings have been repurposed to meet demand. Yesteryear's dockland warehouses became luxury apartments back in the eighties. In central London, townhouses originally built for gentry have found a new lease of life as offices and shops over the decades.
The way we rent out property adjusts when the market requires it to. Flats or houses become offices, and become flats again – we build what we need at the time, then we convert, refurbish, or redesign when that no longer works.
Here we'll look into how COVID-19 is altering the way we invest in property, plus how the pandemic is shaping and reshaping property market trends.
Work from home, and holiday here too
As a nation, we're changing our behaviour. We've been forced to reevaluate the way we separate our work from our home life. That home isn't just where the heart is anymore either – it's where we spend a great deal more of our time too. That profoundly changes what we need from our bricks and mortar.
For example, holiday or short term lets are now more attractive than ever. Extra outside space or a home office aren't really trends either – they're merely a response to lockdowns and the reaction to a new requirement for functional home office spaces.
The measures taken by the government to stem rapidly growing case numbers have undoubtedly brought about many changes – but for property investors, the ‘new normal' is nothing new at all. Reacting to suit a changing market has always been perfectly normal.
Staging for success - why pointing tenants and buyers in the right direction works
While landlords and vendors can’t magically increase the size of a garden, they can make limited outside space more inviting. Showing prospective tenants or buyers who are on the move because of COVID-19 ‘how to use a room’ is likely to yield positive results.
If you already know what many of them want, it’s time to make that work for you.
- Try home staging a spare single bedroom as a home office, or include a desk/office area in a larger bedroom
- Invest in some garden furniture to make the perfect alfresco dining area or exterior lounge room
- Highlight the versatility and attributes of your property and you’ll be halfway to a signed lease or a sale
At Portico, we offer Home Staging as part of our 2% Concierge sales package, which also includes featured advertising and complimentary property maintenance to make sure your house is in tip top condition. You can see the before and after results of home staging here.
Related: Covid-19 Changes To Lettings Legislation
Location, location, location – but do we still need to be near the supermarket and the station?
The pandemic has transformed the notion of an ideal location for a lot of people – almost overnight. For many who once decided on a next address by examining commuting times, things have changed. Globally, more and more employers are committing to permanent work from home arrangements in the wake of COVID-19. The train station is no longer the draw it once was. Other renters might be prepared to trade off longer travel times to work for more rooms or a bigger garden. The fact they now work from home half the time and a fear of further coronavirus restrictions means they're looking at property in a different way.
More of us are working from home – and nearly all of us want to keep it that way too
The Office for National Statistics says that in July, 30% of adults in the UK were working from home full-time. That's a considerable leap from 2019 figures when only 5% reported having worked from home at any time at all. Another study reveals that 91% of those individuals would like things to stay that way, with one BBC interviewee describing the experience as being 'like getting a pay rise.'
People are spending less on food and travel during the pandemic. While it's been a juggle for many during the chaos of lockdown, it seems that imposed lifestyle change just became a lifestyle choice for some. If anything, lockdown and the uncertainty of the pandemic seem to have focused renters on the importance of a comfortable home environment, and average rent increases remain unaffected by events.
The Office for National Statistics numbers show a steady 1.4 - 1.5% increase in UK rents going back all the way to November last year, and continuing through June 2020 despite government measures to combat COVID-19. Take London out of the equation, and that figure becomes 1.6%. Data from the Association of Residential Letting Agents predicted a definite bounce in the rental market by June this year, with demand from tenants at an all-time high.
The rise of online (property) shopping
Likewise, the way we shop isn't what it used to be. Many have discovered the delights of buying groceries online, and June saw a 91% increase. In fact, we've found out there's hardly anything you can't buy there. More and more of us are waking up to a world where remote working and living isn't just a blessing – it's also made very possible by the digital age.
A huge number of businesses pivoted to an online model during the pandemic. Many have upped their delivery game as a result. Therapy, schooling, even your GP just got more available online than ever.
Lockdown may have been new, but it certainly prompted a large number of people to rethink what it means to be at home. Google Trends data between March and August 2020 reveals the UK topped the global list for searches related to moving house. Figures peaked during March when the reality of the restrictions impacted millions. While that dropped off when the furlough scheme got underway, the graph shows that by the beginning of August, interest had reached 75% of the March value - and it continues to steadily climb.
Getting away from it all doesn't have to mean getting on a plane
An increasing number of part-time commuters and virtual employees is one thing, but what do all those workers do to unwind? Stay closer to home seems to be the answer – and that's been driving a boom in short lets sites such as Airbnb. Apprehension about overseas travel has been a feature of the last several months. Indeed, holidaying abroad has, at times, proven impractical because of the need to quarantine on return too. And that's if you could even get a flight in the first place.
The airline industry has been particularly hard hit by measures that brought international travel to a grinding halt globally. Although routes and services are opening up once again, who's to say there won't be another sudden spike and a lockdown somewhere? Plenty of holidaymakers got stranded the first time around, and it would seem many are deciding to spend their time off in the UK.
For the last few months, Airbnb has only allowed key workers to stay in their UK properties while the nationwide restrictions were in place, as part of their Frontline Stays programme.
However, Airbnb bookings resumed on July 4 in England. If you’re not travelling for work anymore, have decided to move in with your partner, or have left your London pad to escape to the country, find out how much you could make on Airbnb in a few clicks with our online valuation tool.
In an online world, remote maintenance, cleaning, and ease of management are all a reality. After all, that's precisely what tourists and travellers want in the wake of the COVID-19 pandemic – less contact, fewer miles to travel, and more convenience.
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