The COVID-19 pandemic has affected everyone's life since the beginning of this year with many people all over the world being forced in a lock-down 24/7 inside their houses. This situation has made people to rethink their standard of living. A survey in England shows many city folks, especially London which accounts for 18% of potential buyers across the rest of England, have decided to move away from their flats and decided to invest in properties in the suburbs, where life is quieter, and houses there offer more space and lush, healthier surroundings.
Meanwhile in Australia, house prices near popular public schools surge by 35% as the boundary with public school catchment zones has a huge influence on property investment decisions for families with children. In the US, real estate's institutional investors are increasing their commitments to 'impact investing', where they are looking to invest more in properties that provide the needs of working-class families and individuals with affordable and safe communities after their first-hand experience from all the cases of racism and violence across the country. In addition, with the mortgage interest rates continuing to drop, there is now a deluge of mortgage applications compared to previous years. Despite the increase in price and limited supply of houses, with the purchase activity increasing, this could be a sign for a good year in the real estate industry!
What caught our eyes this week?
Housing Market Stabilising During Second Lockdown
The housing market in England and Wales is displaying signs of stabilising, according to analysis of web traffic from property advice website Property Price Advice. Requests in June were almost 70% above the four-year average, the highest ever recorded on the website. Given the level of activity, average house prices for November and December are expected to be 3.3% ahead of the same months in 2019.
Real Estate can be Your Solution in 2021
In a recent report published by PwC and Urban Land Institute, this pandemic will change how property is bought, sold and used. Perhaps one of the most interesting takeaways from the report is “Housing as a solution - for people, for communities, and for societal repair” - and the way real estate will emerge as one of the coming decade's forefront business opportunities. Individuals and families are shifting into planning mode and thinking about their living space in terms of both personal and professional comfort, as well as safety. Institutional investors are increasing commitments to ‘impact investing,’ and real estate investments that address racial inequality are a key target.
Londoners are Ditching City Life for Greener Pastures
An increased share of London residents are now registered to buy outside of the city, with Londoners now accounting for 18% of potential buyers across the rest of England, excluding London itself, according to data from estate agency Hamptons International. Demand for new homes across the UK has soared, driven by a combination of the increased adoption of remote working and desire for more space that has emerged amid the coronavirus pandemic, along with a rush to beat that approaching stamp duty holiday deadline and secure the opportunity to save up to almost £15,000. Buyers are increasingly seeking peace and quiet, with the most coveted spots being eyed by movers earlier this fall were rural areas with small populations.
House Prices Near Popular Public Schools Surge by 35% Even During Recession
Online property sales site Domain has revealed Australia's hottest suburbs for price growth in the year to October with buyers particularly keen on homes near both primary and high schools, as high schools took out six of the top ten spots for the most impressive growth in property values. The boundary of public school catchment zones can have a huge influence on property decisions and data suggests being in the right school catchment area makes a real different to prices, regardless of whether the house was near the city or in the outer suburbs.
Another Record Low Mortgage Rate Just Caused Demand to Jump for Both Refinances and Home Purchase
Mortgage interest rates have set record lows more than a dozen times this year, and last week there was yet another. That caused mortgage application volume to increase 3.9% compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Mortgage applications to purchase a home rose 4% for the week and were 19% higher than the same week one year ago. Amidst strong competition for a limited supply of homes for sale, as well as rapidly increasing home prices, purchase applications increased for both conventional and government borrowers. Furthermore, purchase activity has surpassed year-ago levels for over six months.
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