Do you know the literal definition of a hotspot? It is “a small area with a relatively high temperature in comparison to its surroundings.” However, in the property market, a hotspot is a place of increased popularity, interest and activity. Of course, it depends on the type of hotspot – as estate agents in Sheffield will clarify, there are various areas which have recently increased in popularity.
In this article, we attempt to define them and the reasons why they are hotspots. Your home could be in one!
House prices have risen and are continuing to rise, despite predictions to the contrary. However, no matter where a person’s dream home may be, affordability has to be taken into consideration. Recent surveys have shown that prices in the north are generally lower than in London, other cities and the south. The cost of living in the locality is also an important factor. Hotspots are increasing where affordability is viable. A check on prices in various locations over the past 3 years can generally point to whether or not the location is in an “increasing price” spot. According to an expert, “Many of the areas that saw the biggest house price growth over the last year enjoy a combination of greater affordability and space compared to nearby cities.”
In developing, scantily populated areas, planned and ongoing infrastructure projects could make the location a hotspot. The projects will not only create employment and lead to better civic administration and connectivity, but will also boost commercial development. Research into such projects, with the timeframe by which they will be ready, will provide details of the growth development expected in the area. Such locations could become property hotspots.
Areas which offer attractive facilities automatically gain in popularity. A good internet service is essential. So are transport connections, shopping, medical facilities, educational institutions and entertainment centres. Security and areas with a low crime rate are increasing in popularity. Space for car parking or a garden are plus factors. If more people are moving to the locality, it shows the buyers’ confidence in the area.
With remote working during the pandemic, a definite swing in priorities where housing was concerned came into effect. People started looking to move out of urban areas to the suburbs and rural areas, where larger, more spacious accommodation was available at lower prices. Outdoor recreational areas became a plus point, caused by the need for both living and working from home. Some of the popular areas are located in Kent, Yorkshire, Derbyshire, Nottinghamshire and Hampshire.
Now that near normalcy has returned, with some people going back to offices for work, another trend of returning to the cities or surrounding areas is taking place. More popular are the towns near the cities, where property is cheaper to buy but which also offer good commuting services. Increasing interest has been shown in the counties surrounding London, the South East, South West, Midlands and Cotswolds.
Some of the people who want to continue working online from home without returning to offices have shown an increasing interest in coastal areas. Competition for homes in these areas has risen. Larger accommodation and the peaceful, scenic beauty combined with interesting entertainment facilities have made these locations property hotspots. Earlier, they were generally used for holiday homes, but flexible working conditions have seen more people investing in and living in these areas.
Although London will continue to be the priority for foreigners investing in property, recently there has been increased interest in other areas as well which are offering good returns for less expensive investments. Data shows that more foreign investors are looking at areas that have been redeveloped and regenerated such as Manchester, Salford, Leeds and Liverpool. Flats and apartments seem to be popular, which helps to meet the demand of the high rental market in these areas.
The above details may answer the question to whether or not your home is in a property hotspot. Investment in likely hotspots may bring good returns. The main goal for a property investor is to obtain an increase in the value. However, there are risks as well which could reduce the resale value. The supply against demand imbalance, delays in completion of projects leading to poor connectivity are risks that need to be taken into account. If your home is in a location that meets the definition of a hotspot, we hope that the “small area” continues to keep a “relatively high temperature (increase in popularity) in comparison to its surroundings”! This will have a good impact on the value of your home.