Feb

The rush to buy second homes is resulting in bidding wars and gazumping

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The impetus behind this appears to be from people, some workers freed of their daily commute to work, are all looking for the same thing: a country or seaside bolthole, the perfect resting place in the midst of a pandemic, providing it has a good internet connection.

With foreign holidays looking very doubtful for another summer, at least ones with no hassle at airports and ferry terminals, the British countryside or coastal locations look increasingly attractive; they look like the perfect alternative.

Try to book a holiday cottage and you are lucky to find one, either one that’s actually operating at the moment or one that has vacancies. Those operators and landlords lucky enough to own one are experiencing boom times themselves, and with Covid restrictions set to continue for months if not years, the prospects for the holiday letting businesses are looking rosy.

Prospective buyers are reporting that properties for sale are flying off the shelves, so an amount of panic buying has set-in, exacerbated by the stamp duty deadline at the end of next month. Though there’s still a three percent surcharge to pay on second homes, there’s still a saving of up to £15,000 on up to a £500,000 purchase.

It is only those who have purchases well underway by now who will benfirt, though there’s a small chance the Chancellor will extend the deadline by six weeks, in his budget in early March, for those purchases already under way. Currently, letting agents and solicitors are working round the clock to get through the bulge in property sales.

One couple, James, 65, and his wife, Michelle, told The Sunday Times, that they are facing stiff competition in their search for a new home. The couple had sold their main home in Maidstone, Kent, but found themselves in competition with holiday cottage hunters, second-home buyers, when they were themselves looking to relocate to the West Country.

“Sometimes we can’t even get viewings because there are a shortage of slots the properties are so in demand. When you are driving hundreds of miles to look at a house you need to be sure you can see it when you get there,” said James.

It is thought that this pandemic-motivated shift in consumer behaviour, a lifestyle choice in housing, will likely continue throughout 2021 and possibly beyond.

Agent, Tim Hayward, director of Jackson-Stops’ Burnham Market branch office in Norfolk says:

“We don’t expect the stamp duty relief coming to an end on March 31 to have an impact on sales in the holiday homes market here, the drivers are different to what they were a year ago and people want a British bolt hole now more than ever.”

Those that are lucky enough to own a holiday home, or who have managed to secure a recent purchase can expect a ready market if they want to let the out to staycation visitors, those wanting and alternative to the continental holiday, or ones further afield.

What has become a nightmare for airlines, cruise companies and package holiday firms has become the gift that keeps on giving for home based holiday home owners. According to the The Sunday Times, Daniel Frost, 46, an architect from Esher in Surrey, bought a holiday home near Lulworth Cove in Dorset shortly before the first lockdown. Thinking this would be perfect for his wife, and their two teenage daughters to holiday there part time, renting it out the rest of the time.

“We spent lockdown renovating and then in September opened it up to rental and got loads of bookings. It’s been quiet this year because of the latest lockdown, but in the last two weeks we’ve had eight bookings for this summer so I am optimistic. I had a little wobble about the timing in the beginning but in retrospect, when I look at the market now, I think we picked up a good deal.”

It looks like his timing was perfect: buyers are now paying extraordinary prices for properties in sought-after locations. One agent, Lillicrap Chilcott, sold a four-bedroom new-build home in the village of St Mawes on Cornwall’s south coast for £4.5 million “sight unseen” this last summer.

David Fell, senior analyst at the estate agents, Hamptons International said:

“Since March there has been a consolidation of favoured second-home locations, pre-pandemic hotspots have got hotter, while ‘warm spots’ have cooled. The ten local authorities recording the highest share of second-home purchases in 2020 have all increased their share from 2019 This has been driven by a shift from urban to rural, underpinned by Londoners accounting for a larger proportion of second-home purchasers outside the capital.”

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