With the prospects of a Covid-19 vaccine on the way, predictions of the London housing market have speculated the affect it might have on 2021 property prices. As March 2021 sees the end of the current Stamp Duty Holiday & Furlough scheme, concerned predictions of the London property market were voiced. However, could the optimism produced by the testing of a new vaccine take pressure off this uncertainty & even begin reparations of the housing market?
London is a prime location for first time buyers as the younger population are attracted to the vibrancy of city life. Prior to the pandemic, first time buyers equated to 52% of the UK property market as mortgages requiring a 10% deposit were prevalent. However, mortgage lenders have been reluctant to offer for less than 15% deposit, dramatically reducing property purchases from this group of buyers. Predictions suggest the vaccine will encourage banks to lend at a lower interest rate as their own risks are reduced due to more job certainty.
The attractions & facilities of London has always encouraged buyers to pay the accelerated prices of this prime location. Without these amenities during lockdown, the attraction to our capital city has been vastly reduced. The prospects of an effective vaccine will increase accessibility throughout London, re-introducing interest in city living again.
Not only will the vaccine encourage British residents to return to urban life, international travel will be permitted boosting the prime central London market once more.
The unforeseen nature of 2020 has left a lack of confidence surrounding the economy & markets alike. Marc Schneiderman, director of Arlington Residential, suggests that the property market is “driven by emotion..if there’s a feel-good factor out there amongst buyers, the market can really be on fire”. Following a predicted lull as the Stamp Duty Holiday ends, an effective coronavirus vaccine would only increase positivity in London society. Ensuing a bloom of confidence regarding property purchases going forward.