On 12th May 2020, the government gave a cautious green light to reopen the housing market in England. It remains to be seen whether there is cause for optimism. Should you have any questions, please email us or call 01225 755656.
With an estimated 450,000 residential property transactions on hold, yesterday the government gave a cautious green light to the reopening of the housing market. They believe that releasing £82 billion in pending house sales, with resulting increased business for builders, tradespeople, removal firms and others, will help to jump-start the economy.
While stressing the need for social distancing, with immediate effect the new rules allow estate agents to open, property viewings to take place, show homes able to be inspected and removal firms to operate.
The Secretary of State for Housing, Robert Jenrick, said “Our clear plan will enable people to move home safely, covering each aspect of the sales and letting process, from viewings to removals. This critical industry can now safely move forward, and those waiting patiently to move can now do so.”
However, the change applies only to England, with the devolved administrations in Wales, Scotland and Northern Ireland opting to keep their property markets on hold.
Mr Jenrick also announced a series of measures aimed at reinvigorating the house building sector. These include:
- “Allowing builders to agree more flexible construction site working hours with their local council, such as staggering builders’ arrival times, easing pressure on public transport;
- “Enabling local councils and developers to publicise planning applications through social media instead of having to rely on posters and leaflets, helping to unblock the service; and
- “Support for smaller developers by allowing them to defer payments to local councils, helping those struggling with their cash flow while ensuring communities still receive funding towards local infrastructure in the longer term.”
As we take our first cautious steps towards the easing of the lockdown, it’s clear that the housing market is seen by the government as a key indicator of the underlying state of the economy. Yet, in just a few short weeks, it’s possible that a lot has changed.
BLB Partner, Stephen Bishop, said “While there’s clearly a hope that these steps by the government will release considerable pent-up demand, it’s equally clear that people are feeling far less financially secure than they were. I expect many are reassessing their priorities and for those who decide to proceed, we are likely to see a lot more negotiation over price.”
It also remains to be seen whether obtaining a mortgage will be harder, particularly for those with a high loan to value ratio. The start of lockdown saw mortgage lenders withdrawing many of their fixed-rate deals.
“Inevitably, lockdown will also have played a role in shaping people’s aspirations,” said Richard. “Subject to their budget, good WiFi, a spare room and a large garden will no doubt now be high on the list of priorities.”