Zoopla’s latest forecast that the house hunting surge will be ‘short-lived’ should not dampen the spirits of estate agents and developers across the UK and they should instead focus on the rising level of confidence returning to the property market, says Hilltop Credit Partners, a specialist funding partner for SME and mid-sized residential developers and housebuilders in the UK.
Commenting on the report, Paul Oberschneider, Founder and CEO of Hilltop Credit Partners, said: “In a big vote of confidence, Zoopla’s latest data showed there has been a spike in demand in online property searches — up by 88 percent following the reopening of the market, which is 20 per cent higher than at the beginning of March. Demand has risen by 40 per cent from pre-coronavirus levels in Portsmouth and Southampton. It also increased strongly in Newcastle, Oxford and Leeds.
“The report does say that this spike in demand is only temporary with four in ten buyers shelving their plans because of market uncertainty and loss of income, but I’m a bit of an optimist here. The economic issues we’re experiencing right now are the cause of a virus, unlike deep rooted problems in the housing sector which lead to the 2008-09 crisis. The two fundamental drivers still remain in place: the supply-demand imbalance across the country, which isn’t going to change overnight, and the large addressable market in funding.
“I also believe that buying property is not just a financial transaction, it’s a lifestyle changer and has an immense aspirational value. People will always need and want homes and no lockdown or recession is going to change that. Better living, better lifestyle and affordable homes should be the wave that developers should follow.”
“At Hilltop, we see a lot of opportunity in the coming months and we continue to see an uptick of demand for property development finance from established, quality developers working on attractive projects. That’s demand for both debt and equity. Our fund remains focused on cautiously funding high-quality assets and developers, and disbursing over £75 million in the coming months.”
Tiger Craft, Partner and CFO, adds: “For SME developers, securing funding has been needlessly time-consuming and expensive for too long. To address this problem, we at Hilltop are focused on helping developers move quickly so they can secure sites, build homes, and sell them in a fast, cost-efficient manner. Unlike traditional lenders, we operate like a private equity house and effectively back the management team. Our interests are always aligned with the development team as the focus is on a successful exit.”
