With the brakes released to a degree from the property market, many eyes are keenly trained on what the initial response is to the overall confidence, demand, supply and pricing. Property portals such as Zoopla have seen an increase in demand by almost ninety per cent across many parts of the country, the resurgence taking activity way beyond that reported in March prior to the lockdown. Our contacts in the sector have also been rushed off their feet, with our conveyancing panel, property solicitors, removal companies and estate agencies all combining to release the bottleneck of pent up transactions created by the eight to nine-week delay.
Many signs point to the remainder of this year being crucial to what follows in the medium term. Figures due toward the end of the summer and in autumn will really show the full picture of activity and what the future could hold once the surge has subsided, the government furlough scheme winds down and the economy begins to bounce back.
Housing Market Predictions
Will the market seamlessly revert to a sense of normality or will the wild predictions of price falls followed by big gains play out to be true? We believe somewhere in the middle is the most likely outcome with familiarity coming back into 2021 after a small dip in asking prices and then modest gains of 3-4% per annum post-2020. However, no one can be completely certain of the impact Covid-19 and the lockdown will have at this stage with relatively small data samples available at present.
As ever, supply and demand coupled with how confident buyers and sellers appear will ultimately decide what happens and that will be borne out this year depending on the economy, jobs, taxes, a possible second virus spike and mortgage availability.
The long term outlook for house prices remains positive, the Royal Institution of Chartered Surveyors providing one of the most optimistic opinions. Many in the mortgage and estate agency world also echo this view with most estimates in the range of two to five plus percentage points each year over the next four to five years. Again this should be tempered by how we exit the Covid world and how the economy overcomes the significant challenges ahead but history suggests we are a robust bunch and people will still need to move, that much can be relied upon.
Mortgage Payment Holiday Extension
It is also worth noting the government recently extended the mortgage payment holiday option. Originally due to end in June, the scheme which can help those financially affected by businesses shutting down will continue through to August. It should be said that it is advisable to only use a payment holiday if you really need to, it can negatively impact any future application whether moving home or even remortgaging. Always seek professional advice on the subject.
Many of the conveyancers and property solicitors on our panel at Your Conveyancing Solution are also cautiously optimistic about what lies ahead. Whilst some in the wider industry have struggled working remotely, the strong digital presence of the team here has allowed the huge upturn inactivity to be negotiated better than many companies that could not bring back staff quickly enough. The creative and user-friendly online tracking technology, no sale no fee proposition, quality client focus and competitive pricing have kept the panel of over 75 different firms very busy indeed. The group is increasing too and soon will incorporate in excess of 125 branches in a plethora of locations across England.
Changes to the Conveyancing Sector
The conveyancing sector is also dealing with some significant industry adjustments too. How conveyancers obtain evidence of identification has recently altered in conjunction with a change of name application. With the large amounts of money created within the world of property, the target for fraudsters is, unfortunately, an appealing one.
Section 6.3 on Change of name has been amended to clarify that, where evidence of identity is supplied in respect of a change of name application, Land Registry also need to see evidence in the person’s former name. More information can be acquired via the following Government publication.
The impact of Covid-19 is also creating new obstacles when it comes to moving home, for buyers, sellers and conveyancers alike. There has been a cross-industry guide now published, prepared by the Law Society and Society For Licensed Conveyancers among others. The purpose of the collaborative announcement is to ensure sales and purchases can be completed safely and in line with government measures. The guidance also sets out considerations for electronic and wet-ink signatures, ‘Mercury’ style execution, ID verification, witnessing and simultaneous exchange and completion, while adhering to social distancing requirements.
Disclaimer: The article above is an opinion piece based opinions of what may happen within the property market and wider industry, comments should not always be relied upon.