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The 2020 Review of the Nottingham Property Market
Looking back at the Nottingham property market for 2020, it can certainly be seen as a frenetic game of two halves, albeit with a very long half time in the spring. Between the General Election in mid-December and Christmas, many Nottingham agents saw an unusually higher uplift in activity in the property market just as we were getting ready for Christmas 2019. Yet once the New Year festivities were out of the way, that pre-Christmas uplift in the local property market was nothing when compared to the bang on Monday 6th January 2020 with the fabled ‘Boris Bounce’ of the Nottingham property market. January, February and most of March were amazing months, with the pent up demand from people wanting to move from the Brexit uncertainty of 2018/9 being released in the first few months of 2020.
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Nottingham Landlords and Second Homeowners Will Probably Save Money from the Proposed New Capital Gains Tax changes
If the proposals were adopted in full, some Nottingham landlords would pay £8,000 less Capital Gains Tax than they would currently
The government borrowed £394bn this financial year (April ‘20 to April ‘21). This figure does not include the cost of November lockdowns and support measures, which means the final bill will probably be over half a trillion pounds. Ultimately these billions will need to be paid back to cover the cost of Coronavirus.
The Office of Tax Simplification (OTS) published a report for tax reform and, as was predicted by many in the press, the Government Dept suggested the Chancellor contemplate readjusting current Capital Gains Taxation (CGT) rates with a person’s own Income Tax rates. This would mean increasing the rate of CGT for selling a buy to let property from 28% to 40% for high-rate taxpayers and 45% for additional rate taxpayers. To add salt to the wound, the OTS is suggesting cutting the £12,300 annual CGT allowance.
This has led to many Nottingham buy-to-let landlords contacting me in the last few weeks, wondering if this is the time to exit the Nottingham buy to let property market, especially as they have been hit by growing levels of rental legislation and higher taxes.
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The sale of property is one thing that has not been curtailed during the second lockdown and, as estate agents we have been busier than ever. And we expect this to continue long into the Christmas/New Year season, as there’s a lot of catching up to do for some very keen buyers.
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What a month - with two major news stories within hours of each other that are likely to have a positive effect on the UK housing market: the US election result, and the discovery of a Covid-19 vaccine.
We know that stability and confidence underpin so much in the economy – jobs, inflation, interest rates, mortgage approvals, the stock market, general investment, pensions and of course property transaction volumes and house prices. Increased certainty generates the confidence on which so much hangs.
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Finally, after the pent-up frustrations of lockdown, we have some very good news to report:
Firstly, the Chancellor of the Exchequer, Rishi Sunak, has announced a substantial boost for the housing market with the raising of the SDLT (Stamp Duty) threshold from £125,000 to £500,000. This really is quite incredible and will save buyers up to £15,000 (£10,000 for first time buyers who already enjoy a discounted SDLT rate). If the idea is to kick start house sales then this is certain to do the trick. There are plenty of buyers around, enjoying low interest rates too, but stock is woefully low, with 15% fewer properties available than this time last year. This boost will encourage people thinking about moving to do so immediately, as the concession expires in March 2021.
This additional activity will in turn generate knock-on sales and inspire even more confidence in a market that has come out of lockdown with only slight bruising. Indeed, before the SDLT concession was announced, over 85% of movers said they still planned to move, despite the effects of the pandemic. The survey of over 2,000 movers was conducted by Zoopla, who also predict that annual house price growth will hold at around 2% over the coming months as a result of renewed demand and overall activity.
What will happen as soon as the SDLT holiday comes to an end is yet to be seen, but hopefully it will coincide with people coming to terms with lifestyle adjustments and being able to make longer-term housing decisions. Rightmove has already reported that over 12% of movers are actually doing so as a result of virus-related living/working changes. But for the time being, if you are considering moving up, moving down, moving on or moving out, there will be no better time than right now to do so. And that’s not just bullish agents’ speak - this is exciting! Do let us help you quickly and safely bring your property to this fantastic market and help you secure the very highest price. Put us to the test and call us on 0115 8240235 today. You might be pleasantly surprised!