A Covid Boom

People started to value life more, time instantly became the only commodity people valued. Nothing else mattersed Time now was also more available as businesses switched to remote working the commuters gained more time, more breathing space and less frantic hustle that consumed many workers’ lives. Also time alone, in a more isolated way not just in lockdowns but what came after that as people and families decided to allow space away from other people to be their preferences for now. It caused an unhealthy new normal, for a period of time.

But no one could have predicted what the luxury markets did over the last two years.

Rishi Sunak saved home buyers £15,000 of SDLT which rallied the property market like we have never seen. Bidding wars were the only way to ensure you owned the house you wanted. Even though this shouldn’t have affected the top end of the market, it did, it caused unseen actively because buyers and sellers knew the SDLT relief would end. The UK property market was wild.

Not only did the spike happen to the UK housing market, the overseas market went crazy too because the new remote workers could work from sunnier locations. House prices rocketed and are still up.

We saw families wanting to escape in a new way that maybe they hadn’t experienced before. Entry level yachts became hot topic, the order bank for £1m+ yachts with cabins to house the kids jumped like you wouldn’t believe which had a knock on effect to the whole market. Prices soared with a new list price boat being unobtainable without a long wait while used yachts carried heavy premiums but yacht owners didn’t care, now was the time they wanted to buy.

Watches and art, the fun smaller stuff became incredibly popular during the lockdowns because boredom brought the cash to the market. Collectors had time to research and scour the platforms selling high ticket items. Banksy’s for example tripled in value. Patek Philippe 5711 or 5980R became the must have timepiece. Literally everyone wanted one, a £60,000 watch trading for £300,000 and people paying it. A few relationships with ADs would’ve come to an end though!

Here we are in May 2022. Restrictions lifting, no more mask rules and the markets still higher than ever (not the stock market as Amazon lost $600b in valuation) but the luxury market still performs, it does seem to be settling but is this a bubble or are these inflated prices here to stay? My prediction is it’ll take 3 years for prices to get back to 2019 levels.

All this means one thing for you and your assets, get a valuation and update your insurance policy. That’s it.