Kate Andrews

No place but home: how Covid will change the property market

  • From Spectator Life

It took a trip to the Land of Oz to make Dorothy value her home. For the rest of us, it took a global pandemic. During the past two months, our residence — whether that be a mortgage-free house or shared rental flat — has become our entire world: office, restaurant, cinema, gym and shelter, all rolled into one. If we didn’t know the ins and outs of our quarters before, we do now. Many people have developed a more personal understanding of a market that has played a vital role in shaping the British economy for decades.

Housing costs in Britain are some of the highest in the world, more than quadrupling since the 1970s. Failure to increase the UK’s housing stock over the years has made the market increasingly inaccessible to those not supported by the Bank of Mum and Dad, especially in London, where the average home carries one of the heftiest price tags in the world.

Still, demand is high. It’s no surprise England’s housing market has been released from lockdown before many other industries — it’s crucial to getting the economy moving again. At least £82 billion worth of property sales were frozen when the UK formally went into lockdown in March; more than 400,000 buyers had their purchases put on hold. It would be quite a stretch to define estate agents as ‘key workers’ alongside doctors and nurses, but they have been among the first people allowed back to work, even though a major part of their job involves entering people’s homes.

While the role of the housing sector is remarkably different in the Covid crisis than it was during the 2008/9 financial crash, it may prove equally important. A burst housing bubble accounted for roughly a third of the total fall in UK GDP at the height of the crash.

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