The year has been off to a good start for the property market in The Lake District for sellers but no so much for buyers, with a slow but steady number of properties coming to the market in the whole of The Lake District during January and the beginning of February. Nationally 129,000 homes were bought in December 2020 defying all expectations, this was a 32% increase on December 2019. The number of sales been agreed in January were higher than most of us expected, the demand for property in the area remains high however the supply of property in The Lake District still remains low as it has done for the last 18 months, nationally it has been reported that there has been a 12% fall in new instructions with sellers feeling cautious in relation to what the future holds.
Rightmove suggests there has been a 0.3% fall in price nationally however The Lake District property market has in my experience always acted like a little bubble and behaves very differently from the rest of the UK, whilst supply is down, demand is high and the beauty of The Lake District encourages many high-end buyers to the area irrespective of the time of year, the demand for property has inevitably caused an increase in prices in our area over the last 3 months.
Over the last few weeks I have experienced multiple best and final offer situations across the board in the area and inevitably this has pushed the price of said properties sometimes well over the asking price. A slowing down has been felt in the last few weeks as the realization that there is limited time left to make a saving on stamp duty and the nation waits to hear what’s in the budget holds and what happens next.
During January and February, there have been many external factors driving the local market, these have been the expected increases to capital gains taxes, a 2% surcharge to overseas buyers coming in on the 1st of April and the potential end to the stamp duty saving, these combined have driven buyers to be very proactive in seeking properties during the beginning of 2021.
The predictions by many nationally are that there will be a 4% growth in prices in 2021, but we need to be mindful that once the end of furlough is upon us there will inevitably be an increase in unemployment, businesses going under, mortgages may become tight again and the payback for loans will be upon us, these all spell out for a slowing to the market nationally, on the flip side, the flexibility of working from home now means the choices are less restrictive, the desire to move is very much there as we have been cooked up in our homes for nearly 12 months.
In relation to The Lake District property market we have always attracted a lot of high-end purchasers and investors, so I personally cannot see this changing and demand will remain high. The national predictions will inevitably affect the lower end of the local market and we may see a slowing in properties under £400,000 in the area. I cannot see a huge increase in properties coming to the market in The Lake District I expect it to be a slow and steady amount of new instructions similar to what we have experienced over the last 12 months. Predictions for the staycation market are very positive and it’s expected for the next 2 years to be bumper, something the hospitality and tourism sectors in our areas needs to see. I believe the demand will remain high in the area however we may see a drop in the number of best and final offers as the rush to secure a property settles.
All this said Rishi throw the cat among the pigeons with a stamp duty reform now so watch this space……….