Today’s Conveyancer Community Comment On Property Restart
The property sector is collectively breathing a cautious yet overwhelming sigh of relief today following the reopening of the property market.
According to data analytics organisations, this means the estimated 163,000 properties worth £55 billion which have been frozen at sale agreed with searches completed can now start to add a welcome cash injection to the sector.
With an estimated 372,000 properties available, the sector could be in for a busy period in the days and weeks ahead. With the multiplier effect likely to ensure removers, solicitors, surveyors, developers, planners and builders are set to benefit, this is a time to reflect on the difficulties but also celebrate the collective effort and sacrifice that have brought us to this point.
A number of experts in the sector have taken the time to express their relief and optimism, but also a clear desire to ensure our approaches to work in the week ahead ensure the continued safety of employees and clients.
James Tucker, CEO at mortgage technology provider, said:
“The reopening of estate agents and the ability to have viewings and in-person valuations has to be good news for the housing and mortgage industries. Of course, all parties will need to be careful, adapt to the new circumstances, and continue to follow Government guidance and best practice, but hopefully our industry will play its part in helping the economy back onto its feet.
“There are strong indicators that there’s a lot of pent up demand in the market, so it’s quite possibly going to be a busy period for everyone involved. It will take a few days or weeks to see where the level of demand is. We’ll continue to publish our data so that brokers and lenders can see the shape of the market and make the right decisions for their businesses in line with that.”
John Dobson, CEO at AML specialists SmartSearch, on the return to work in the property market.
“After several weeks of deep uncertainty, it’s only natural that estate agents and others involved in the property market will want to get back to doing deals again as quickly as possible. But the return to work is the point of maximum danger when it comes to the risk of fraud and money laundering.
“Criminals will be on the lookout for any sign that defences have been lowered, where agencies are not at full strength or may be tempted to cut corners in order to get deals done quickly. The Financial Action Task Force – the global financial crime watchdog – has recently warned of the heightened risk of fraud and money-laundering during the present crisis.
“Estate agents, conveyancers, brokers and lenders all need to be on red alert for suspicious activity.”
Rebecca Swain, head of residential conveyancing at Thomson Snell & Passmore.
“Although the property market never actually ‘stopped’ (it has been business as close to usual as possible for us), we are delighted that the government has set out plans to ‘restart’ it by easing the restrictions on moving home.
“Enabling estate agents to arrange viewings will certainly kick-start new transactions (very few – if any- would ever have bought a property based on a virtual viewing alone) and permitting surveyors and valuers to visit properties will mean transactions commenced prior to the restrictions can now progress to exchange.
“With appropriate safety measures in place, removal companies can also resume work, so that completion arrangements can also be made. The exact details of what will be permissible have not yet been published, but it is certainly a much needed boost to the property market.”
Andy Marshall, Chief Commercial Officer, Zoopla, said:
“We’re delighted that the Government has recognised the need to restart the property market, permitting estate agents to operate – within the parameters of common sense social distancing. Now is the time to get the market moving and to restore it to full health.
“With 373,000 transactions held up in the pipeline, amounting to £82bn in property value and £1bn of agent revenue, the Government’s move is set to be a catalyst for the broader economy. The multiplier effect of estate agency will stimulate cashflow for a network of industries, from removal firms to decorators to solicitors, benefiting the economy at both a local and national level.”
Brian Berry, Chief Executive of the FMB, said:
“Construction makes a significant contribution to our economy, so when output falls so does the the economy. The Government’s green light for construction sites to re-open safely in England is very positive but it’s going to be a hard slog to get activity back to where it was.”
“To reverse the decline in output a clear plan for recovery is needed that specifically supports local builders. Small to medium-sized (SME) construction firms operate across the country, and create local training and employment opportunities. They are central to achieving the Government’s levelling-up agenda, and can help stimulate local growth in the long-term. This should be delivered through a national retrofit programme that sets out a plan for upgrading our existing homes. This should be underpinned by a temporary cut in VAT to stimulate demand for these works.”
Peter Sheehan, owner and director of The London Resolution, commented:
“The restrictions on the property market may have been lifted, however the dynamics of the industry have profoundly changed and will remain so for the foreseeable future, argues Peter Sheehan, owner and director of prime property company The London Resolution.
“The estimated 450,000 people currently in a chain or awaiting their move, will be breathing a collective sigh of relief as the industry machinery starts cranking into gear again However, anxiety among the professional property services is high as they work out how this will operate in practice. The wellbeing of estate agency staff will be a top property for employers – not just for the good of their team, or for business continuity, but also for avoiding litigation.
“Never before has corporate social responsibility been so important. Creating a safe workplace for estate agents no longer means providing an ergonomic chair or standing desk – it now means avoiding the situation where an estate agent comes back from a viewing complaining that a person coughed on them and now they may have been infected with Covid-19.
“Formal processes will now have to quickly be instigated and followed rigorously, be that with staff avoiding public transport, social distancing in the office, wearing good-quality PPE on viewings or separating staff teams into Team A and Team B, with never the two meeting (for the next few months).
The other significant issue surrounding the property market at this time is the value of property. Not only have property prices been affected, but residential valuations will be affected too. Valuation surveyors will be far more hesitant to undertake in-person research, although the applicants and the banks will no doubt insist on it. Where they can, we anticipate many may choose to undertake desktop surveys instead. The result of this, as well as banks being more risk-averse in the current financial climate, is that banks will be more likely to only accept the lower range figure of the property valuation – making it more difficult for a buyer to achieve a good LTV ration, or indeed a mortgage at all. Finally, the importance of the virtual viewing process will remain in place once social isolation is over.
“Instead of visiting a property several times before making a decision, in the future clients will have gone on two or three online “virtual tours” of the property and be better informed before committing to a physical visit where they may then make an offer. The continuation of the virtual viewing post-Covid-19 means clients are further down the educational process before they pick up the phone to the estate agent.”
Tom Parkinson, Solicitor and Head of Property & Director at Rowlinsons Solicitors, commented:
“Very welcome news for the Property Industry tonight from the Government. Hopefully we can now start to help those clients again who have been so patiently waiting for this news. Let’s not forget though to adhere to those extremely important measures that are still in place for very good reasons!”
Gavin Wall, director at Conveyancing Expert, commented:
“Do you know what I love about conveyancers? It’s the ability to find a solution to everything thrown in front of them. Today will be the start of a massive learning curve as we all find ways to deal and work in this new world. We need to order funds and redemption statements earlier, get documents posted faster (though I’m delighted with the change at the Land Registry and the Mercury signing approach) and most importantly, remind our team and ourselves that our clients need help, re-assurance and great legal advice. I’d better get on and bring some smiles.”