What are the guidelines on moving house during lockdown? - New Build Inspections
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What are the guidelines on moving house during lockdown?

The English property market has got the green light to reopen as the Government announced new regulations that will lift the seven week freeze on property viewings and home moves today.

Housing markets in Northern Ireland, Wales and Scotland remain shut, but in England people are now allowed to travel to visit estate agents and view properties. Surveyors, valuers and conveyancers can return to work following social distancing guidelines.

Since the sector was effectively suspended at the end of March, 373,000 transactions have been thrown up in the air and newly agreed sales have dropped by 90pc, according to the property portal Zoopla.

The process of buying and selling a house is now going to be radically different. The Government this morning issued detailed guidance for how viewings and sales can go ahead in line with social distancing requirements.

The Royal Institute of Chartered Surveyors this afternoon sent out pan-industry guidance with further details on how to navigate the physical contact points of house moves. Here’s what it means for the market right now.

How soon will we be able to go to house viewings?

Before Prime Minister Boris Johnson’s announcement beginning lockdown easing on Sunday evening, the property industry was already gearing up to restart at the end of May, pending a Government sign-off on proposed guidelines.

Now, it has been given the go-head to reopen immediately, but viewings will depend on when individual estate agents plan to reopen.

Dexters has opened its 70 London offices from today by appointment and is now offering viewings. Knight Frank is arranging viewings and market appraisals from today and will reopen its offices on Monday. Winkworth will to start viewings again on Thursday and will also reopen its offices on Monday. We will update this page as more agents confirm their plans.

How different is the process of buying a house now?

Be aware that even the current guidance could change again quickly. The Government guidance states: “It may also become necessary to pause all home moves for a short period of time to manage the spread of the coronavirus.” The current information is dependent on the outbreak staying under control.

Virtual viewings will become far more commonplace. The Government’s newly published guidelines say that initial property viewings should be online.

According to the Rics guidance, viewings should be kept to only the agent (who will stay at a two metre distance)  and a maximum of two adults from the buyer’s household. An agent should be present for viewings wherever possible to ensure the guidance is followed. Small children are allowed to come to house viewings but they should be kept from touching things and was their hands regularly.

Sellers will be expected to open all doors and turn on light switches, and then wait in the garden or vacate their home while the buyer views the property without touching anything. They should provide a place where buyers can wash their hands and dry them with separate towels (ideally paper towels). Surfaces and door handles must be cleaned before and after every viewing.

Buyers must avoid touching any surfaces and should bring their own hand sanitiser. There is a ban on open house viewings. If a member of any household is exhibiting coronavirus symptoms, the viewing should be delayed.

When the industry body guidelines are released, they could also include recommendations for buyers, sellers and agents to wear PPE. Everyone will most likely be expected to provide this for themselves, said Mark Hayward of NAEA Propertymark. 

Wherever possible, mortgage lenders will make their valuations remotely, using existing local transaction data. The exceptions will be if the buyer is purchasing with a small deposit (namely 5 or 10pc) or the property has a particularly high value, in which case a physical valuation in line with social distancing guidelines will still be necessary.

Will there be a surge of activity when the market reopens?

Those 373,000 sales that are currently on ice cannot be quickly or easily reheated when restrictions lift. Zoopla expects the total number of sales in 2020 to sit at half the normal benchmark.

But initially there will likely be a small flurry of completions, as seen in the first few days of New Zealand’s market reopening. These will primarily be transactions that were previously agreed and which had their completion dates pushed back in line with the Government guidance. 

After that, there could be something of a stalemate. The good news is that relatively few vendors have withdrawn their properties from the market. But all eyes will be on what happens to house prices, and these will be closely tied to employment figures – although we won’t know the effect on house prices for some time as the Office for National Statistics has said there aren’t enough transactions to publish its index.

For now, the Government’s furlough scheme is protecting the wages of 6.3m people and one in seven home owners are part-way through a three-month mortgage holiday. 

When these schemes end, forced sellers who have no choice but to accept price discounts may start to come to the market, and these sales will drive the price statistics down. Their numbers will be reduced by record low interest rates, which will make their mortgage debt less of a problem than in previous recessions, but the Bank of England still expects values could fall by as much as 16pc

Will the Government help?

Many in the property sector are calling for Government stimulus. A stamp duty reduction or holiday is, as ever, at the top of the wish lists of estate agents. The Royal Institute of Chartered Surveyors (Rics) is among the trade bodies that are calling loudly for tax cuts.

But this may be wishful thinking: any kind of reduction in tax revenue is hard to imagine while the Government is battling what is set to be the worst economic downturn in 300 years.

More plausible is an extension to the Help to Buy equity loan scheme, which is currently due to be reformed in April 2021 and to end completely in 2023. 

Deals on homes being sold under the current scheme will effectively need to be agreed by December to meet the April deadline. An extension would prevent the risk that home sales would miss the deadline because lockdown has delayed both construction and sales.