With England set to go into a second lockdown tomorrow (Thursday 5th November), a lot of you might be wondering what this means for the property market.
Unlike the first national lockdown, the Government have given the housing market the green light to stay ‘open’ throughout this period.
Housing Secretary, Robert Jenrick, confirmed that the property market can continue to operate with viewings and valuations whilst following Covid safety guidelines.
Housing market update ahead of Thursday’s measures:
🏡 Renters & homeowners will be able to move
📦 Removal firms and estate agents can operate
👷🏻♀️Construction sites can and should continue
🔧Tradespeople will be able to enter homes
📋But all must follow the Covid safety guidance
— Robert Jenrick (@RobertJenrick) November 1, 2020
This is great news for home movers, especially those looking to beat the stamp duty deadline – but how will lockdown 2.0 affect market activity?
Our fountain of knowledge, also known as our CEO, Colin Mellor, has taken the time to offer his insight into what he thinks will happen to the property market in the coming months.
Using over 40 years’ worth of industry experience and a lot of data, here’s how our property expert thinks a second lockdown will affect the housing market.
“The housing market has shown resilience since the last lockdown, with a healthy level of new properties coming to the market and a good number of buyers looking to move or buy their first home.
There have been many reasons for the positive market conditions and none of them are underpinned by high loan-to-value mortgages.
I think it’s fair to say mortgages for first-time buyers have never been more difficult to get. Anyone who was furloughed at the start of lockdown has also found it pretty difficult to get a mortgage.
Normally, these two things would hold the market back – but this hasn’t been the case. We’ve seen a really healthy level of sales over the last five months, which have pushed house prices up to record level highs.”
“It’s inevitable this will create some demand once the lockdown is released, however, we might not see this come through until January 2021 due to the release being so close to the Christmas holidays.
As the Christmas decorations start to come down in early January, this is usually when many homeowners decide the New Year is the right time to make a move. It’s one of the reasons why we see a flood of new buyers enter the market at the start of the year.
Typically, the number of website enquiries we see over the Christmas break and into the first couple of weeks of the New Year are 20% higher than at any other time of the year.
In 2021, we could see a substantially higher volume of buyers enter the market in comparison to other years due to Boris Johnson’s ‘Generation Buy’ scheme.
The new scheme aims to deliver 95% mortgages to first-time buyers, which will most likely happen through banks and building societies.
If this becomes a reality, we could potentially see more buyers than sellers, which has an upward pressure on house prices.”
“If you’re thinking about buying a house, but are putting it off because you think there might be a downward correction in house prices next year, I’d advise you to reconsider.
If you want my honest advice, aim to agree your purchase before Christmas.
Granted that all goes to plan with completion, you’ll be in your new home within the first few months of the New Year AND you’ll have a fighting chance to still make the stamp duty deadline which could save you thousands.
At Edward Mellor, we’ve put in a substantial amount of work to make sure the home buying process is simple and safe for all of our clients.
We’ve made big investments in new technology, such as our immersive 360 virtual tours, to ensure that you can continue your property search from home.
We offer interactive viewings on almost all of our property listings – so you can take a virtual walking-tour around multiple houses from the safety of your sofa.
Virtually view any house at any time and if you have any questions, our dedicated team are only a phone call away. Once you’ve virtually viewed your dream home on our website, we can arrange a physical viewing for you, so that you’re able to make an offer.”
If you’d like to discuss your next move with our team, please do get in touch – we’d love to help.