At the start of this year, you would have got very, very long odds on the prospect of UK-wide lockdowns, mandatory mask-wearing, social distancing, the cancellation of exams, the World Cup and Glastonbury, scrapped summer holidays, a very different Christmas and seemingly everyone in the world being on a Zoom call at some point or other.
But that has been the reality thanks to the ongoing battle against coronavirus. However, despite the Covid-19 pandemic, and the many challenges and obstacles it has brought, investment in property has continued to happen – both domestically and overseas – just in different, more innovative ways.
Virtual viewings have become a vital tool, there’s been a rise in people purchasing sight unseen, and everyone from Build to Rent (BTR) and purpose-built student accommodation (PBSA) operators to overseas resorts and UK housebuilders have had to change and adapt the way they work to cope with the new normal.
As the year ends on a much more positive note – with the start of the rollout of the vaccine across the UK – people are looking forward to 2021 with more hope, albeit in a world that has changed dramatically. The switch to remote working for many is likely to be a permanent legacy of the pandemic, while many people have re-evaluated their lifestyles, priorities and relationship to nature.
Overseas travel has become much more difficult – and is likely to remain that way – but with the rapid rise in remote working (and the general success of it), there has been a rise in digital nomads and families considering relocating to sunnier climes or destinations they’ve always dreamed of living in.
The long-term social, economic and psychological impacts of the pandemic will be with us for some time yet, and there is likely to be uncertainty in the first few months of next year as a result of both Covid and Brexit.
Property investment, too, has been changed by the pandemic. As a result of Covid, the high street’s decline has accelerated faster than ever before – with a number of major names filing for bankruptcy or liquidation in 2020, from the Arcadia Group and Debenhams to Cath Kidston, Le Pain Quotidien, TM Lewin and Bonmarche – which in turn has led to an uptick in commercial to residential conversions, or retailers such as John Lewis moving into rental property. This trend is only likely to continue next year as the high street’s struggle endures.
Aside from the commercial to resi revolution – which is set to be further supported by proposed government changes to the planning system – BTR has continued to grow as a major trend, bouncing back strongly since lockdown. Similarly, PBSA has continued its strong upwards growth trajectory, and co-living has started to gain some momentum, too – although it remains very niche and somewhat in the shadow of BTR.
Senior living, one of the rising trends of 2019, seems to have slowed a bit in the last year – although major operators like Legal & General continue to invest in this market – while we’ve seen less on PIT concerning eco-friendly developments and fractional ownership via cryptocurrency (two other big trends in 2019).
Overseas investment – both into the UK and from UK buyers purchasing homes in hotspots like Spain, Portugal, France and Greece – has remained robust despite Covid and Brexit uncertainty. There remain significant question marks over Brexit and its impact on overseas investment, and how the 2% additional surcharge on non-UK buyers will impact things when it’s introduced in April next year, but all the signs point to some kind of reciprocal arrangements being agreed between the UK and its main tourist hubs post-Brexit.
Investment into the UK from China and Hong Kong has also been one of the main trends of the last year, and shows no signs of slowing down.
One of the main success stories of 2020, meanwhile, has been property auctions. Here at PIT, we’ve always covered this sub-sector of the investment market with a keen eye, but our coverage has really snowballed this year – so much so, we now run a weekly auction roundup feature to cover the sales of the biggest auction houses up and down the country.
People have turned to auctions more than ever this year, and its smooth transition from in-room to online – helped by many firms already having the systems and processes in place to achieve this pre-pandemic – has helped the sector to thrive throughout Covid-19, with record sales, prices and success rates. When we ran a series earlier this year on what auctions will look like in the future, most of the auction houses who responded were in no rush to return to in-person auctions anytime soon, if at all.
Interestingly, in a poll we ran on a recent story – which asked whether Covid had triggered the death of the traditional auctioneer – 73% of our readers said online was the way forward, with only 2% believing in-room experiences will return when it’s safe to do so, and 20% believing there will be a hybrid mix again in the future.
As well as the above, we’ve also been delighted to carry an increasing number of guest pieces from a wide range of guest authors, who help us to provide quality content on a whole host of issues. What's more, we recently launched our guides and tips section to offer investors advice from a wide range of experts in their fields.
2021 is set to be another busy year in the property investment world, and the PIT team will be there again to bring you all the latest investment news, alongside our usual range of in-depth features on a wide array of topics – from property cons and houseboats to green property and leasehold scandals. As ever, if you have any ideas/pitches for features, please get in touch with us on firstname.lastname@example.org.
For now, all that’s left to say is we hope our readers have an excellent Christmas and a happy New Year (even if these will look very different this year).
We will be back from Monday January 4 with our usual five-story newsletter. Until then…we wish you a merry PITmas!