Million Pound Homes Outperform As Wealth Corridors Become Most Attractive
Sales activity in the £1m+ property market is storming ahead according to the latest Rightmove data, as wealthier buyers race for more space and leafier locations in the wake of the Covid-19 pandemic and changing lifestyle preferences.29 September 2020
Sales activity in the £1m+ property market is storming ahead according to the latest Rightmove data, as wealthier buyers race for more space and leafier locations in the wake of the Covid-19 pandemic and changing lifestyle preferences. This makes it a perfect time to support developers and provide investors opportunities to invest in a market that has never looked more buoyant.
A common conception is that houses in the £1m+ market take longer to find buyers than the overall market because of their higher price points. But the latest data from Rightmove shows that the UK’s million-pound homes are actually outperforming the rest of the property market in terms of the number of sales being agreed. The hottest millionaire markets right now are Norfolk, Wiltshire, Cornwall, Henley, Hackney, Tooting, Stoke Newington and Balham, with affluent buyers willing to part with huge sums of money to buy larger homes.
A big reason for this market sentiment is the ongoing pandemic which is pushing many potential buyers to swap city apartments for bigger homes with more living spaces and gardens. With the government’s big push for work-from-home once again, many employees are also expected to spend fewer days in the office and may look to relocate to a bigger property with more outdoor space. The post-Covid market will have an increased focus on indoor and outdoor space and wealthier buyers will be the first to move to bigger homes.
Since the lockdown this year, UK’s property sector has shown incredible resilience despite the market setbacks. Demand from residential developers continues to be strong, and we are encouraged by the strength we have seen in the UK residential market over the past several months.
At Hilltop, we are extremely proud of our one-stop property development finance solution which continues to be well received by the market, and how we have provided c. £30m in lending commitments (to date in 2020) to SME developers across England. The product offered has a dual pronged approach which includes both debt and equity elements. The equity raise on one side helps the developer meet the much needed final stretch and on the other, opens up these exiting developments to investors who may wish to invest and be part of the growth story.
We continue to have a growing pipeline with great sponsors. A case in point is our newly increased £50m loan-on-loan facility from OakNorth Bank which is set to play a huge role in supporting our ongoing development finance lending. We also provided funds for an eco-friendly residential development in North Devon as it combines high-quality construction and design, with green space, energy efficiency, and affordability – catering perfectly to today’s home buyers.