The Homebuyer Wishlist: 2024

The Impact of the Pandemic may be Waning

The 2024 survey results revealed that the impact of the pandemic still seems to linger in some areas. While in others, the effects are dying down. All this has shifted priorities among homebuyers.

Having strong broadband and mobile connectivity is of the utmost importance to buyers in the current market, rising from third place in 2021. This could reflect new working patterns that have emerged. More people are working from home, at least for part of the week. Workers will need a decent connection to accommodate all of those Zoom calls.

The usual, or more expected features also still rank highly. Garden and/or outdoor space, proximity of public spaces and parks, and the quality and finish of the property all ranked towards the top in importance. What’s more, these factors haven’t moved much in the rankings since 2021.

But, beyond this, it’s clear to see that the pandemic’s impacts may actually be going into reverse. For instance, having a garage or off-street parking, along with access to transport links, have shot up in importance. This could indicate that the flexible working trend is reversing for some. People may need to ensure they can get into the office easier, or more often.

Also, the actual square footage of the property dropped dramatically in the rankings. Perhaps, with people needing to get into work more often, those large houses in the countryside are no longer feasible, or desirable.

how built-up a local area is, along with having access to local amenities, is also of less importance. If commuters are heading into London, or Manchester, or Liverpool for work and play – they may be less bothered about spending much time in their local towns.

The potential for extensions and conversions saw the most dramatic fall in importance, dropping from 8^th in 2021, to 14^th now. Is it possible that people are rethinking their big projects, and instead focusing on how they can move back to a commuter belt?

Shifts in the Working World and the Future of Housing

Shifts in the working world certainly support all this. Between 22 May and 2 June 2024, 14% of UK workers worked exclusively from home, according to the ONS[18]. In June 2020, it was 38%.

In fact, in recent months, there has been a big push from many employers to get their workers back into the office, often on a full-time basis. This has faced pushback from employees, but crucial sectors such as banking and retail[19] are leading the charge here. Tesco, Barclays, Boots, Deutsche Bank, and the Civil Service are just some of the big names ordering staff back to the office[20].

It also appears that as many homeowners flocked to the countryside with their newfound freedoms, they may have been a tad bit hasty. Many Londoners specifically have struggled to adapt to rural life[21].

They miss the infrastructure, excitement, and opportunities of the city. So much so in fact, that estate agents have reported that many house hunters are heading back to London after the Covid-era exodus[22].

Beyond the pandemic, buyers have other concerns. Nearly two-thirds (63%) somewhat agreed, or strongly agreed with the statement: “I feel that the UK’s property market is too competitive”. Only 47% of respondents felt the same in 2021. Also, 59% felt there is a shortage of the type of property they would ideally like to own, up from 40% in 2021.

Looking ahead, the majority (68%) also believe building more homes should be a top priority for the UK’s new Labour government. And, despite all the chaos of the past few years, both economically and politically, 57% feel the passing of the general election will bring stability to the UK’s property market.

Confidence is on the rise in the property market and economy, and specialist finance will play a crucial role in supporting investor’s growth over the coming months. Some 61% of buyers believe UK houses prices will rise over the next 12 months. Yet, 65% feel obtaining finance to purchase a property is stressful, while 66% believe the process of buying a property is too slow and complicated.

Fortunately, the specialist lending market will be able to help with these concerns. At MFS, we adapted to the pandemic as it was happening, and remained flexible as we emerged form its shadows.

Our bridging loans can still be issued in as little as three days for those who want to jump on opportunities quickly. Meanwhile, our bespoke BTL mortgages bring bridging-like speed and flexibility to the rental market.

Moreover, we have our new Bridge Fusion product available that combines the best of bridging and BTL finance. Bridge Fusion funding is there for borrowers for whom a bridging loan wouldn’t be cost effective over a longer term, or is too short-term for their needs. It provides optionality for property investors who may need to refinance tricky commercial debt, wait out uncertainty in the market, or invest in the UK from overseas.

Reflecting on the Findings – The View of our CEO

Thankfully, we have put the worst of the Covid-19 pandemic behind us. The virus is now largely under control and rather than utilise all our resources to keep our population safe and healthy, we can instead focus on our economic and societal recovery.

Evidently though, we will be wrestling with the long-term impact of the pandemic for some time. We are still working out how to get back to relative normality, or adjust to a new world. This manifests itself in a number of ways, some dramatic, others more subdued.

Flexible working preferences are likely to be contentious for the foreseeable future. While many buyers are rethinking the concept of a commuter belt entirely. We’re seeing in real time how these shifts are affecting preferences in the market.

Looking ahead however, it’s likely that the coming years will instead be defined by political change, as opposed to the kind of economic shock that Covid-19 delivered. As we all know by now, Labour won the recent general election with a sizable majority, meaning they’ll likely face little resistance to their plans.

As our results showed, homebuyers hope these plans involve bringing stability to the market, and getting more homes built. They may just get their wish.

Uncertainty looms, and assurances from the state should be viewed with a healthy level of scepticism. But, Labour has been very clear with its plans. It’s promised to upend the planning system to get the UK building, push into “grey belt” land, and reinstate mandatory housebuilding targets.

We’ll have to see how these plans play out over the next few years. Fortunately, we at least know for sure that the economic picture is improving. After a prolonged cost-of-living crisis, inflation finally seems under control, with the CPI hitting its 2% target in May 2024[23].

This allowed the Bank of England to reduce the base rate or the first time since 2020[24]. All of this and more could boost confidence, and facilitate activity in the market.

Regardless of what’s on the way, we will adapt as we always have done at MFS. Our bespoke products will be there for whatever challenges, or opportunities loom for property investors.