Updated: Jul 10, 2020
Six weeks into lockdown, key industry data is showing some interesting results.
There is an estimated 373,000 property transactions, totalling £82 billion which are on hold due to the lockdown.
A Rightmove survey has concluded that the majority (94%) of buyers are determined to move ahead with a home purchase once lockdown restrictions are eased.
Most homes listed on Rightmove's website have remained intact. Stock levels are reportedly down by just 2-3% since lockdown started. 10% of transaction are going ahead as planned and over half are postponed, although will continue post lockdown.
At the start of lockdown, Rightmove saw the number of visitors to its website falling by 40%. As of the end of April, the number of visitors to their website has increased by 20%.
Miles Shipside, Rightmove's commercial director, said:
"The resolve of buyers and sellers to carry on with their sale is clear, whether it's those who are going through the conveyancing process already or those who currently have their home on the market or who want to buy when lockdown ends."
Rightmove confirms that there is a growing number of buyers looking to move out the big cities. In May 2019, over 40% of Londoners were looking to move outside the capital. This figure has risen to 51%.
Their April House Price Index confirmed that prices 'unexpectedly' increased in April despite the lockdown. Robert Gardner, Nationwide's Chief Economist, said:
“Annual house price growth increased to 3.7% in April, up from 3% in March - the fastest pace since February 2017 (when annual growth was 4.5%). There have been month-on-month gains for the last seven months in a row, after taking account of seasonal effects."
The Index indicates that economic activity is set to contract significantly in the near term. The government measures should help ensure the impact on the housing market will ultimately be much less than would normally be associated with an economic shock of this magnitude (repeating what Nationwide stated last month).
What other's are Saying
Potentially the main post-lockdown sticking point will be price. Many buyers, assuming house price data turns negative, will look to reduce their offers, while sellers will struggle even more than normal to put an accurate value on their property. This could lead to delays in getting to exchange. The Royal Institute of Chartered Surveyors is writing a new set of guidelines for valuers across the UK and hopes to release them imminently.
James Pendleton estate agents has confirmed that 'gazundering' is back - a buyer lowers their offer price after it has been accepted. However sellers are pushing back.
Andrew Montlake at the mortgage broker Coreco, said that the:
"unprecedented package announced by the Government to support business and jobs, along with rock-bottom borrowing rates, should mitigate the fallout from the lockdown.
Transaction volumes will naturally be down throughout the rest of the year, and prices will be under pressure, but there will always be people wanting to buy and move home."
Whatever the impact of Covid-19 on the housing market, buyers will continue to move. It's therefore more important than ever that your home is staged to attract the most buyer interest.