By Simon Joyce.
We always like to do a review of the local property market at the end of each year so here it is for Derby.
Looking back at the Derby 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 Derby agents saw an unusually higher uplift in activity in the property market just as we were getting ready for Christmas 2019.
January to 23rd March
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 Derby property market.
January, February and most of March were amazing months, with the pent-up demand for people wanting to move following the Brexit uncertainty of 2018/9 in the first few months of 2020.
23rd March to 13th May
The pandemic hit mid-March, and the Derby property market was put on ice for nearly three months as was almost everyone else’s lives.
Yet at the end of spring, 13th May to be exact, the property market was one of the first sectors of the economy to be re-opened. Every economist predicted house price drops in the order of 10% in the best-case scenario and 25% in the worst, yet nothing could be further from the truth.
13th May to 8th July
When the lockdown restrictions were lifted from the property market, those three months allowed Derby homeowners to re-evaluate their relationships with their homes. The true worth of an extra bedroom, for use as an office, became priceless, as people working from home were having to take calls and work from the dining room table.
Properties with gardens or close to green spaces all of a sudden became even more desirable.
More fuel was put on the property fire with the introduction of the Stamp Duty Holiday from 8th July, meaning buyers could save thousands of pounds in tax if they moved before the end of March 2021. This stoked the local property market and now…
Property values in Derby are set at 4.7% higher today compared to a year ago.
8th July t0 5th November
The fallout of that increased demand for a new home meant those properties on the market coming out of lockdown in early summer with those extra rooms and gardens were snapped up in days for ‘full’ price.
Derby buyers were having to spend their Stamp Duty savings on paying top dollar for the home of their dreams. Yet the increased number of properties coming onto the market in the late summer quenched a lot of that demand and the prices being achieved became a little more reasonable and realistic. This increased the number of properties sold , so much so, that nationally, almost two thirds more homes have been sold than would be expected at this time of year!
5th November – 2nd December
The fireworks went off on 5th November when Lockdown 2.0 started at one minute past midnight. Although the effect on property market activity was largely unaffected for those who had already sold, the second lockdown once again put doubts in peoples mind about their homemoving decisions.
However, as we all know, just because a property is sold, it doesn’t mean the property is actually sold. The number of people who have moved home in the last 12 months in Derby, is as you would expect, much lower. Over the last 10 years, on average, 4,428 Derby homes have changed hands per year, compared to only 2,026 in the last 12 months.
2nd December –
The 2nd December saw the introduction of the 3 Tier System which, apart from confusing a lot of people, didn’t really affect peoples mindsets. The time had past to take advantage of the Stamp Duty Holiday as properties sold now had little, if any, chance of completing by 31st March 2021.
So, what is a Derby property worth today?
Drilling down to the four types of homes locally, some interesting numbers appear. Looking at the table, you can see what the average property types are worth locally, and within each type, the average price paid in the last 12 months. So, if the average price paid for the last 12 months is higher than the overall average, that means more higher priced property in that type has sold in the last year compared to the overall average – and vice versa.
Average Overall Value Today
Average Price Paid in the Last Year
|Town House / Terraced
Of course, these are the overall average values. To give you an idea what Derby properties are selling for by their square footage, these are those average values…
||Average Value per sq. ft (internal)
|Town House / Terraced
So, what about 2021?
Well normally when the Country’s GDP drops like a stone, as it did in the Summer of 2020, the property market follows in unison. Yet, as the economy went south, the house price growth and activity in the property market went north. This would appear to be a quite remarkable outcome given that economic framework, but it is gradually becoming clear that, as far as the Derby property market is concerned, people’s time in lockdown has been spent reflecting on what they really wanted from their home and has meant that the normal rules of the game simply do not apply… for now.
There are the doomongers out there, notably the British media, who are predicting a property market crash and I am currently researching an article which asks that very question – will the Derby property market crash in 2021?
In the meantime, if you have any questions on the local property market, please do not hesitate to contact me.
Simon Joyce: 07977 235545