City centre locations and flats are staging a comeback in the housing market, with the easing of restrictions helping drive demand.
There are signs of buyer demand in city centres and for smaller properties bouncing back, according to an analysis of over 1.6 million properties from the UK’s biggest property website Rightmove (RMV.L).
Buyer demand is measured by the number of people contacting estate agents to request more details about a property for sale on Rightmove.
Data gathered showed that flats have seen the biggest jump in buyer demand since January, up by 39% — replacing family homes which had been the strongest performers in the market.
This was closely followed by demand for bungalows, which saw a 30% increase in demand over the quarter.
Demand in city centres is up by 35% compared to a 32% jump in demand for villages.
Rightmove found that the easing of covid restrictions has increased the appeal of living in a city centre, leading to some cities seeing buyer demand jump as high as 76% in York city centre, followed by a 62% jump in Norwich and a 57% rise in Sheffield.
Similarly, if you look at all urban locations and all rural locations across Great Britain, the growth in buyer demand for urban locations is now outperforming the growth in rural areas for the first time since before the pandemic started.
“These are early signs but they certainly point to some good news for city centres across Great Britain, with a number of agents now telling me they’ve seen a marked uptick in demand from first-time buyers, and they’re managing to sell city centre flats more quickly than in earlier months of the year," said Rightmove’s housing expert Tim Bannister.
Meanwhile, according to Rightmove, on average, city centres have seen price growth remain flat at 0% since the start of the year, helping some buyers find a relative city bargain.
Another factor driving the housing market right now has been the introduction of the government’s 95% mortgage guarantee scheme. This, coupled with a virtual standstill for prices in many of these city centres has combined to help more first-time buyers get onto the property ladder.
A new study by Rightmove among over 1,000 first-time buyers has found that just under one in five (17%) are planning to use the 95% mortgage guarantee scheme or are already using it.
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