NW property firm reassures investment in ‘bricks and mortar’ despite COVID-19
As Covid-19 continues to have an impact on families and businesses in the UK, a North West based property firm, Solomon New Homes, is reassuring house buyers and investors of the relative safety of bricks and mortar for future investment. As people follow government advice and stay home, there will be an absence of property viewings and surveys taking place resulting in a slowdown in lettings and sales to homeowners for a while, but the property firm stresses that underlying demand won’t go away. Andrew Ward, founder of Solomon New Homes comments: “The good news is that the property investment is looking very resilient. A recent poll carried out by an estate agent in London found that 83% of those looking to buy or sell a house planned to go ahead regardless of the coronavirus. He adds: “In many respects, that’s wholly understandable. The value of commercial property can quickly fall if businesses start to get into trouble, but families can’t go into liquidation; people will always need places to live and Covid-19 won’t change the fact that there’s still a pronounced under-supply of housing. Basic laws of supply and demand suggest that property must hold its value in the long term, just as it has always done.”
Last year the firm handled 220 new property sales across northern towns and cities including Doncaster, Hull, Liverpool and Manchester totalling £23m. With a growing demand for town centre regeneration developments and the rise in the appeal of Northern secondary and tertiary towns for home buyers and investors, the property firm is confident in its predictions that post Covid-19 the housing market will bounce back.
Andrew continues: “It’s important to remember that property investment is not a short-term business. It works best for people over a period of years rather than the far shorter period in which Covid-19 is likely to be a factor. The pandemic will pass and, sooner or later, the property market will be ready to stir again.”
Before Covid-19, average UK house prices were tipped to rise by more than 15% over the next five years. The firm believes that partly reflected the strength of demand for property and the extremely low cost of borrowing. Now, despite the pandemic, Solomon insists demand is as strong as ever, and the price of borrowing has fallen even further, so two fundamental arguments in favour of property investment remain.
Andrew adds: “By reserving a property now, homebuyers and investors can take advantage of reduced purchase costs, delivering a big saving on the usual market prices. And finally, in the longer term, that underlying combination of strong demand and under-supply of housing should help to underpin sustained capital gains, even if the pandemic does prompt a short term pause in transactions.”
Solomon continues to offer property investments with rental assurance agreements despite the current situation – allowing investors to achieve a promised return regardless of occupancy. Should occupants be unable to make their monthly payments for any reason, the firm’s rental assurance agreement means they would continue to receive the expected income. To assist with the continuation of property transactions during Covid-19, Solomon New Homes is also now offering supportive incentives such as free solicitors fees, plus interest on all deposited funds which can now be returned the investor monthly rather than deducted from the final property purchase payment.
Andrew concludes: “We understand how concerning it is for everyone right now, and as a business we’re committed to keep the UK property sector afloat in whatever way we can and reduce any potential financial knock-on effect of the pandemic which is why we’ve introduced the monthly interest scheme on new schemes. To further meet these commitments, we also take out landlord insurance on all of our sub-tenancies, covering any damages or loss of rent at occupancy level. Our current occupancy rates are the highest they have ever been, and the majority of tenancies are on long-term contracts which should offer owners and investors reassurance during this unprecedented period of disruption.”