We’re all living in unprecedented times, and whilst we’re adjusting to the rules of social distancing, self-isolation and working home. It’s hard to not worry about the impact this pandemic is having on the economy.
We hear daily in news bulletins, how retailers are faring, with more stores closing down daily. However, the impact will be felt and is being felt by more and more businesses as the economy begins to stall.
It seems inevitable that the property market is going to go into a decline, but by how much?
Doortsteps estate agency have revealed some stark figures for March. They’ve recently revealed that they’ve seen a 77% reduction in property sales from the first week in March to the third. In the same time period, they have seen a 51% decrease in daily bookings for property viewings. The situation is seemingly worse in the capital, where the virus seems to have taken a stronghold with sales plummeting, with the agent seeing a reduction of over 90%.
Akshay Ruparelia, Managing Director for Doorsteps, said:
“We are just trying to stay very lean and focus on getting through it.
“Demand to sell properties is not going to change, it’s just deferred, so when things pick up we could have a great few months.
“It’s all about weathering the storm.”
Experts are all uncertain how much the current situation is going to impact the property market.
Ray Boulger, a Mortgage Technical Manager at John Charcol, expects house prices to fall 10% by the end of the year, with transactions tumbling in the next three months alone to a figure lower than that recorded at the worst depths of the 2009 credit crunch.
“It is clear activity in the property market will be severely curtailed, not only because of the economic uncertainty dissuading people from moving but also as a result of practical problems of surveyors visiting homes to prepare a mortgage valuation.”
Meanwhile, other experts are trying to work out the potential impact Covid-19 will have on property transactions.
Anthony Codling, Head of property firm Twindig has estimated transactions will fall by more than 60%, from 66,000 a month to 26,4000. Although other experts are suggesting the drop could be more like 80%.
Anthony Codling said:
“You’ve got to be desperate to move, so transactions could fall more than during the credit crunch when they fell by more than 60%.
“That’s going to be a big problem for estate agents.”
Although no one can predict how much impact this pandemic is going to have on the property market, it’s safe to say it will be one that has a huge impact, which could be felt in the months to come.
Nobody wants to go back to the days when we were recovering from the recession, but it seems that most of those in the property industry are preparing themselves for a similar reduction in sales.
