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Adding value, rental demand, Stamp Duty holidays, and questions for first-time buyers

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While Covid-19 continues to dominate much of our daily news, property markets are nevertheless beginning to reopen as buyers, sellers, landlords and tenants begin to find their feet once again.

As the property world begins to reawaken, here are some of the latest snippets of news to reach the headlines.

Adding an ensuite adds £4k to a property’s value

House-hunting – subject to the usual social distancing rules – was made possible once again with effect from the 13th of May, reported the Guardian newspaper.

To add a little gloss to that good news, homeowners were also advised by a report in Property Wire last week that main bedrooms with an ensuite bathroom command a significantly higher price.

A recent survey showed that the average buyer is likely to pay £4,000 more for a property that has an ensuite bathroom.

On the flipside, if the only bathroom in the property can only be accessed through the kitchen, buyers are likely to offer substantially sell than the advertised price - £7,000 less on average, but £10,000 or even as much as £20,000 less in some cases.

Demand for rental property up

The reopening of the property market has seen a particular surge in the demand for rental accommodation – underlining the extent to which the lockdown has created considerable pent-up demand.

In a recent story, Letting Agent Today revealed that demand – measured by the volume of listings on the website Rightmove – had not only returned to pre-lockdown numbers but even surpassed it.

The total available stock of housing for rent – listed by the website – is now 13% higher than at the same time last year and has achieved a record in the site’s history.

The average monthly rent across the whole of the UK currently stands at £1,089 – some 2.1% higher than a year ago, although growth has been slower than the pre-coronavirus rate of 3% per annum.

Is it time for a Stamp Duty holiday?

Another online listings site Zoopla on the 21st of May joined the call for a Stamp Duty holiday to provide immediate stimulus to the reawakening housing market.

The website argues that property transactions will be significantly increased by reducing the tax to zero. By describing any such move as a holiday conveys the sense of it providing only temporary relief – and, therefore, a further incentive for buyers not to delay but act soon.

The authors of the story estimate that total property transactions could be down by as much as 50% for 2020. So, Treasury receipts from Stamp Duty are in any case also likely to be halved to £4 billion.

The article concedes that the results of Stamp Duty holidays in the past have had a mixed impact on activity in transactions. It also recognises that those buying more expensive homes would benefit more from such a holiday. Stamp Duty is currently payable on a sliding scale for house prices that starts at £125,000. First-time buyers are exempt from Stamp Duty when buying a home of up to £300,000 and at a lower rate on home up to £500,000.

9 questions FTB’s should ask

Listings website Rightmove has published the nine questions any buyer needs to ask before buying a home – and which vendors need to be ready to answer:

    1. Why are you selling;
    2. How long has the house been on the market;
    3. Any recent extensions or structural alterations;
    4. Is there parking;
    5. How much do the average monthly utility bills cost;
    6. Is it a chain-free sale;
    7. Are there any local problems or issues;
    8. What furnishings and fittings are included in the price; and
    9. What are the neighbours like?

If your home is for sale, being ready-armed with the type of questions any prospective buyer is likely to be asking might help you stand a better chance of proceeding smoothly to a successful completion.