WILL CORONAVIRUS AFFECT HOUSE PRICES?

Unsurprisingly, this is one of the most asked questions we’re hearing right now. Since the COVID-19 outbreak. Many people, entirely understandably want to know will coronavirus affect house prices.

After all the Brexit uncertainty, there has been a recent period when the property market has bounced back with plenty of new instructions and with sales also looking healthy. A momentum had developed, so with coronavirus impacting the whole economy, you may be concerned that this has now altered and be wondering what you should do if you are looking to buy or sell a property in the coming months.

We appreciate this is a time of uncertainty and worry for many people, so to help you, we have answered your top three questions regarding COVID-19 and how it may affect the property market.

  1. I want to buy a property, what do I need to know?

It’s difficult to say exactly what the full impact of coronavirus on the property market will be, as things change on a daily basis. Mortgage lending was relaxed with Accord, HSBC and Virgin Money all lending to people with a 10% deposit but as they started to assess their appetite for risk, they tightened up again and now only HSBC are offering a 90% mortgage. No doubt this will change again soon so if anyone wants to speak about mortgages then get in touch.

Whilst lending may be a bit trickier for some, for those with larger deposits there are over 230 houses for sale in South Craven with 50 new houses having gone up for sale since we were allowed to start work again 4 weeks ago and over 70 sales agreed in that time too! The market is certainly busy.

What viewers might find though is that arranging a viewing is a little different. With safety being our top priority, as part of our due diligence we are asking all viewers to provide answers to a number of pre-viewing questions before we make an appointment. This is done via email so we can keep a record as part of our new risk assessment policy. These pre-viewing questions are designed to keep the viewer, the homeowner and us as safe as possible. For more information about this please give the office a call.

2. I am selling/want to sell my property, what do I need to know?

If your property is currently on the market then you may see fewer enquiries and as part of the pre-viewing questions we are asking, viewings on your property will be down as we are rightly focusing on quality over quantity.

As we knew viewings would be down we have increased the exposure of the houses we have for sale by providing video tours for all of our properties. Up to press they have been collectively viewed over 4,000 times resulting in over 80 hours of watch time! Amazing!

The best advice I can give those who have a house on the market at the moment is to not feel pressurised in to accepting a lower offer on your property if you don’t have to. No one has a crystal-ball; we don’t know what the market will look like next week, never mind next month/year! It’s a challenging time for everyone. Hold your nerve!

For those looking to sell then just to go over the figures mentioned above again. In the last 4 weeks there have been 50 new properties put up for sale and 70 sales agreed. Those levels of supply and demand I talk about all the time are very much in the homeowners favour at the moment meaning It is a VERY good time to sell.

However, selling a property is never a “one size fits all” situation. You may have to sell but are worried about the market and as such you may decide to defer the marketing of your property for a while. We understand that this may be the best decision for you. It is the right decision for more people than you might think!

We are in to double figures now for the number of new properties that will come to the market with us, when the timing is right. To find out more about this option feel free to give us a call.

3. Will prices go down?

The million dollar question! Prices have actually increased in the last 4 weeks as demand has been high and supply has been low. This no doubt is due to pent up demand resulting in lockdown restrictions being lifted for the industry. This will tail off a little as we all find ourselves easing in to a new normality.

I’ve had a lot of discussions with contacts up and down the country. People high up in large corporate agencies, family run independents like us, property “gurus” (I hate that word!), mortgage advisors and mortgage underwriters. What I have found is that those dealing with the finance side of things are naturally pessimistic (nice to see that their attitudes have changed post the 2009 recession!) They are pessimistic, despite seeing a huge increase in new lending. Accord Mortgages reported to have had the busiest two days in their history earlier in the week! As mentioned earlier in the blog though, lenders are restricting things again, which in the long run is the right move to make.

Those dealing with property day in day out are rather optimistic though. Some believe that the housing market with thrive and prices will continue to increase over the coming years. Whilst estate agents do need to be optimistic the advice they give needs to be based on your needs and not their own business needs.

Personally I do not think house prices will come crashing down. The government have intervened in such a way as to avoid another recession and prevent businesses from going under and with retail shops being able to start trading from their premises again as of Monday, I think we will continue to see plenty of activity in the housing market.

Of course, the furlough scheme and business loans need paying back at some point, a sum to the tune of £90bn at present. Purse strings are certainly going to have to get tighter in the not too distant future.

The advice I gave to people throughout the whole Brexit carry-on still applies now.

If you have job security, can afford to pay your bills, treat yourself every now and then and still have a holiday and go to the pub (whenever those two things might be physically possible) then what is stopping you buying your dream home now?

Thanks for reading

Michael

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Thinking of moving? Have a question to ask? Call the office on 01535 666031, call me direct on 07557 088460 or email me: michael@leightonsestateagency.co.uk for honest, expert and friendly advice.

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