We know the pandemic sent the property market berserk with prices, particularly outside of major cities where demand saw prices rise at a rate never seen before. Buyers fled cities, particularly London and headed for the countryside for fresh air, open space and larger properties with home working potential.
By the time the first lockdown ended, two years ago, places such as Yorkshire and Derbyshire were so sought after, that homes were selling before hopeful city dwellers could even travel up the motorway to view them. Some estate agents reported a 250 per cent increase on buyers from outside of their area.
But life has started to return to normal, Covid-19 is rarely mentioned in news bulletins, replaced by the cost-of-living crisis and whispers of another recession. So, is the countryside property market about to burst?
The main issue is that there is a major shortage of properties in these areas now, so estate agents certainly won’t see the volume of transactions they have seen over the last couple of years. Furthermore, people are keeping an eye on their finances, taking into account the state of the economy, inflation and whether they can remain working from indefinitely or whether there is an expectation for them to return to the city offices. Buyers are more reluctant to make a move whilst so much uncertainty is on the horizon.
Far from the frenzied ‘above asking’ offers which have been commonplace over the last 18 months, the market is adjusting to a more sensible approach, and buyers are certainly cautious, offering 10 per cent or more under asking price.
I think the answer to whether the ‘bubble has burst’ is yes, in the sense that the level of activity seen was simply unsustainable. What happens from here on out, whether prices drop off a cliff edge like in 2008, or whether they gradually resume to more sensible levels will determine what buyers and sellers do next.
The worst outcome for those who have made the leap to the countryside is to find themselves needing to move back closer to the city for work but unable to sell due to a declining market. If companies are forced to make redundancies then we could see a reverse of last year – people moving back to the cities to look for work.
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