For both landlords and renters, it’s been a huge 12 months for varying reasons, and it’s not controversial to say that everybody is starting to feel a sense of relief as we start to see the light at the end of the tunnel in regard to the lifting of restrictions.
We’re still early on the roadmap but all the signs are good and getting better, and the UK’s extraordinarily successful vaccine programme appears to be potentially accelerating this further than any of us truly or reasonably expected.
For renters and workers it’s been a year of contrasts; on the one hand we’ve been relatively lucky that the British government has introduced one of the most generous worker support programmes in the world, with the furlough scheme as well as support with rent breaks and evictions, for example, but for many people it’s been a tough time having to either work from home or take an extended break from work.
That being said, there was a significant announcement within the past few days as the chancellor Rishi Sunak announced the budget, setting out his economic plans for the rest of the year and how that effects things such as tax, spending and incentives to get the economy moving.
For workers and renters, the headline announcements were that the government is extending furlough by a further six months, extending it to September to protect jobs and incomes whilst the economy starts to recover.
The minimum wage will also be rising by 2.2% from April, effectively handing a pay rise to millions of lower paid workers. As reported by the BBC, there’s also more support for the self-employed, with an announcement that, ‘From next month, claims can be made for a fourth grant worth 80% of three months’ average trading profits, up to £7,500 in total.’ Furthermore, the Universal Credit uplift will be extended six months too.
Whilst far from ideal it signifies a huge support package and caught some by surprise with its generosity with government spending at its highest since the last world war. If all of the indicators used to plot out our return to normal remain positive, then we can be somewhat confident that we’ll be able to get back to work quite soon.
All in all, however, it should be pointed out that the fact that the chancellor has announced he will extend the stamp duty holiday and support for a 95% mortgage probably means a great deal more upward pressure on demand for property in the UK.
What does this mean? Firstly, prices are probably going to rise steeply again this year, with some areas in England seeing rises of over 8% in 2020. It wouldn’t be a shock to see a similar rise this year.
For those potentially looking at getting on the property ladder it spells bad news as deposits required for a mortgage will likely increase along with house prices and demand.
For rental property, there’s also been a huge surge in demand too meaning that supply has been choked significantly, and you’re likely to have noticed this if you’ve been searching for rental properties in your area recently. This is likely to continue so if you do see somewhere you like and you’re looking to move then the advice would be to get things done quickly, as you could be facing stiff competition.