Despite the coronavirus pandemic, which has brought the housing market to a standstill for several weeks, Hamptons predicts that around 23,000 homes will be flipped this year, up from 20,857 last year, and investors are on track to make bigger profits .
The housing market has been booming in recent weeks, as pent-up demand after the first foreclosure was released and after Chancellor Rishi Sunak introduced mortgage leave on properties up to £ 500,000 in July .
The average difference between the purchase price and the sale price of returned properties has reached its highest level since the record started in 2007, now standing at £ 40,995 nationally. That’s more than £ 10,000 more than the average profit recorded in 2019.
According to researchers at Hamptons International, average profits have increased as investors shifted more to apartment houses. Only 5% of homes bought and sold since the housing market reopened in May were apartments, down sharply from 20% in 2019.
“Fins play an important role in the housing market, improving the housing stock and supporting projects that other buyers often won’t touch,” said Aneisha Beveridge, research manager at Hamptons International.
“Since the market weakened following the financial crash of 2007, the number of homes knocked down has decreased. However, in recent times their numbers have started to recover. ”
The turnaround is more common in the North East and North West of England, with traders looking to make a quick profit by targeting areas where property is more affordable.
So far this year, one in 12 homes sold in Burnley had been purchased in the previous 12 months, which equates to 51 properties. The average difference between the purchase price and the sale price was £ 20,643.
About 80% of the properties returned to Burnley, the vast majority of which were terraced houses, were purchased for less than £ 40,000, the level at which investors are typically required to pay an additional 3% stamp duty, and below of the general threshold for the tax.
After Burnley, the second most popular location for the turnaround was County Durham, followed by Rutland in the East Midlands, Middlesbrough in fourth and Stockton-on-Tees in fifth. Merthyr Tydfil, in eighth place, is the only local authority in Wales to feature in the top 10.
It’s been two years since anywhere in the south of England appeared in the top 10 turnaround locations, but that could be about to change, according to Beveridge.
“While the current stamp duty holiday will save palms across the country money, its full impact will not be felt until early next year, when these homes are likely to return to the market. for sale. As investors in the more expensive regions will see greater stamp duty savings, there is a potential for Burnley to be knocked out of the top spot before too long, ”she said.
Top 10 local authorities with the highest proportions of homes returned this year
1. Burnley: 8.2% of properties returned within 12 months of purchase, with an average selling price increase of £ 20,643
2. County Durham: 5,8% et 6 780 £
Rutland: 5.8% and £ 45,269
4. Middlesbrough: 5,5% et 6 100 £
5. Stockton-on-Tees: 5,4% et 8 775 £
6. Wolverhampton: 4,7% et 22 191 £
7. Hyndburn: 4.6% and £ 26,410
8. Merthyr Tydfil: 4,5% et 20 417 £
9. Darlington: 4.5% and £ 11,549
10. Walsall: 4,4% et 27 536 £
Source: Land Registry and Hamptons International