Interiors Expert View On The Future Housing Market
The ending of the Stamp Duty holiday will bring a gradual exodus to commuter towns and cities, according to Elaine Penhaul, owner and director of leading home staging company Lemon and Lime Interiors.
Elaine says: “As ever in the UK in social situations, the housing market is a hot topic of conversation – never more so given the huge ups and downs of the last 18 months. I believe the market is still very ‘hot’.
“Much has been made in the press of the speed at which homes are selling this year. Many of the homes coming onto the market are selling very quickly, and there hasn’t been much new stock.
“Demand was pent-up for three years following the Brexit referendum, caused by caution surrounding the political and economic fallout whereby it seemed that only sellers who had to move – often driven by another life change – were actually coming to market. The floodgate opened with Boris Johnson’s election in December 2019 and uncertainty reduced. We were extremely busy for a few short weeks, until the gate was slammed shut with lockdown on 23 March 2020.
“Lockdown has served to fuel the fire of demand on the market, with many people continuing to move out from the cities. This demand on a limited housing supply has seen house prices rise at 13.4% this year, the fastest annual rate for 17 years (according to a Nationwide Building Society report June 2021).
“The Stamp Duty holiday has served to further inflate house prices. With no Stamp Duty to pay up to a threshold of £500,000, vendors and agents have been more confident of achieving a higher guide price. The extension of this holiday to the end of June has maintained the activity level in the traditionally busiest spring market.
“One effect we have noticed in the past couple of weeks has been an increase in fall-throughs. Buyers not confident of completing their transaction ahead of the end of the stamp duty holiday period at the higher level are either renegotiating prices or pulling out altogether.
“As an owner of a home staging firm, we always recommend that our clients do not remove any staging for a property until exchange of contracts – just in case. This has proved to be good advice in recent days; we are seeing properties returning to market – attracting a new buyer very quickly while there is still a lot of activity.
“We usually see a slight drop in business over the third quarter. Naturally, anyone wanting to sell their family home is unlikely to come to market while the kids are on school holidays, with families planning holidays and it being much harder to keep a home tidy when the kids are off school. The usual drop in sales may be tempered this year by our inability to go abroad on holiday for the most part. The gravitation to rural and coastal areas will surge again after summer breaks when more people realise that the UK has a lot to offer outside urban areas.
“The fourth quarter will bring a shift back to communal workplaces. Buyers who have moved to commuter towns will win out and prices here will stay high, as a gradual exodus from the countryside will bring people back to commuter areas and cities, in search of greater connectivity and community life.
“In my opinion, it will be urban areas that will retain high values and high activity. Less commutable options and ‘out-in-the-sticks’ homes will gradually return to pre-lockdown values and levels of activity.”
Elaine Penhaul started her business in 2012 and has launched Stageflow, a data-driven home staging app, and launched her Amazon best-selling home staging book, ‘Sell High, Sell Fast - How to sell your home for the best possible price, in the quickest possible time’. Elaine is also a board member and regular speaker at the Home Staging Association and has been featured as a guest speaker on many property, interior design and small business webinars, panels and podcasts.