At the start of 2020 Bradley Hall, like many businesses, had sat down and begun the process of drafting our business plan for the upcoming financial year, looking to capitalise on the growth in our residential business and the opportunities we saw in the months and years ahead. It’s amazing how things can change.
Nobody is in any doubt that this is not ‘business as usual’ at the current time and no matter how long or hard the impacts of Covid- 19 may be on the region’s residential property market this year will undoubtedly be diﬀerent from what we had predicted back in January. When we return to work however, the signs, at least at this stage remain that the fundamentals of the residential property market are strong with low interest rates, aﬀordable mortgages and general lack of stock encouraging activity. Couple this with people having the time to re-assess their housing needs or using this time to complete those long held oﬀ DIY tasks to improve their properties suﬃciently to feel it is time to move and we do remain conﬁdent in the ability for our market to bounce back.
Forecasting at this stage is a dangerous game given the remaining uncertainties but most central scenarios predict a sharp decline in market activity now and into early summer but followed by a sharp rise in activity once the majority of the government’s social distancing policies are lifted and return to pre-pandemic conditions within 3-6 months thereafter and back onto the upward trajectory we were previously on.
The residential development sector will also undoubtedly be impacted in the short term by the Covid-19 pandemic with restrictions placed on people’s ability to move as well as the limiting of the construction of new homes. As we return however the heavy use of incentives and the underlying fundamentals discussed above should help drive a return to sale volumes. It should also be remembered that the delivery of a new build housing site is often long in the making with the site ﬁnding, purchase, planning and implementation of any scheme lasting many months and often years. As a result, while the short term impacts for construction and sales are severe, the overall cycle for housing delivering is measured and managed over timescales that far exceed what we are currently experiencing and by remaining steadfast in driving sites forward housebuilders will continue to feed their cashﬂow with new opportunities and be ready to capitalise on the return to a stabilised trading market.
In the short term our priorities rightly move away from transactional property markets but we can certainly remain conﬁdent that when the current situation stabilises, opportunities will return and the plans we optimistically wrote at the start of 2020 will become relevant once again.
This article has been featured in our property, lifestyle and business magazine, Portfolio. Read the full edition here.