As England enters a minimum four-week national lockdown from the 5th November, Chief Operating Officer, Gavin Richardson, sets out what property investors can expect to happen in the property market during this time. Will house-viewings, valuation inspections and development continue, and will there be an extension to the Mortgage Payment Holiday?
It’s a difficult time for us all as England prepares to join Wales and Northern Ireland in another lockdown. I think it’s fair to say, however, that compared to March the property investment industry is much better prepared this time around. The majority of us are now well accustomed to working from home; including lenders and solicitors.
While many industries will once again have to close their doors fully, the property market is not one of them. The Minister for Housing, Robert Jenrick, confirmed that the industry would remain open under the current health and safety guidance. To make it clear what will be possible during the coming weeks, here’s a breakdown:
Tradespeople Can Enter Homes
As long as workers abide by the Government’s guidance for working in other people’s homes, tradespeople can continue to enter and complete work in your property. Crucially, this includes surveyor inspections for property valuations.
Unlike in March, mortgage and remortgage applications will not halt due to the suspension of physical property valuations. Where possible, remote/desktop valuations will continue to be used to minimise the need for physical inspections; however, where these are not possible, surveyors will be able to enter properties, subject to the guidelines.
We’ve already had confirmation from one of the largest surveying companies, Connells, that they are ready to continue as they have been since mid-May. However, it’s worth remembering that there may be some vulnerable people who will not feel comfortable allowing surveyors into their properties at this time, and may wish to delay appointments until after the lockdown is over. While there may be a few individual delays, we do not think we will see the wide-spread backlog developing as we did in the spring, and that on the whole further delays to your mortgage applications will be minimal.
As a property owner, this also means that any improvement works can go ahead as planned. Therefore, as a landlord, you will still be able to improve and update the home environment for your tenants, as required.
Estate and Lettings Agents Remain Open
Estate and Letting Agents can continue to operate by appointment only. Where possible, virtual property viewings are encouraged in the first instance so that only those with a strong interest in a property can book a physical viewing.
Unfortunately, it’s likely that given the ‘stay at home’ message some people may put viewings on hold. On the other hand, many are still keen to make the most of the stamp duty holiday, and time is running out to get applications in and guarantee completion before the 31st March 2021, so it’ll be a balance. Furthermore, there are suggestions that the desire for more living and outdoor space will be compounded by this second lockdown, which may create another flurry of activity in both the purchase and rental markets. However, this, of course, remains to be seen.
You Can Still Move!
Renters and those looking or about to move home can still do so, and removal companies are still allowed to operate. Of course, you will need to follow the COVID-19 health and safety guidelines on social distancing and hygiene.
Construction Sites Remain Open
In a bid to minimise the economic impact of the necessary second lockdown, the Government have confirmed that construction can continue. Not only is this a relief to all property developers, but for those developments looking to complete in time to qualify for the Help to Buy build deadline, extended by two months to the 28th February 2021. Having experienced significant delays in the spring, it’s likely many will still be playing catch up as they work towards renewed deadlines.
Guidelines for Property Valuations and Viewings
- Occupants of the property should be contacted before the appointment to confirm that no-one has displayed symptoms and that they understand the health and safety measures required to complete the appointment safely
- No appointments should happen where any involved party has symptoms, has recently tested positive or is required to isolate
- Ideally, occupants should vacate the property for the duration of the viewing or valuation. However, if this is not possible, individuals should wear face coverings and must maintain a 2m social distance at all times
- Residents should leave all internal doors open to minimise surface contact and ensure the property is well ventilated. Surfaces and door handles should be cleaned before and after the appointment
- Anyone entering the property should wash or sanitise their hands immediately upon entering
You can find the full set of guidelines for the Royal Institute of Chartered Surveyors (RICS) here, and the Government’s advice on moving home (here) and working in other people’s homes here.
Mortgage Payment Holidays
The Government has confirmed that there will be a six-month extension to the Mortgage Payment Holiday scheme. Lenders will accept new applications, and those who have already paused mortgage repayments will be able to extend this arrangement for a maximum of six months. This news will come as a huge relief to the estimated 1.6 million households who are concerned about paying their mortgage over the coming months.
It is worth mentioning here, however, that as lenders process requests for mortgage payment holidays and extensions, the additional workload will need to be spread across the existing members of staff. While hopefully not as disruptive as in March, we do expect this to delay mortgage application processes over the coming weeks. Therefore, if you’re hoping to get a purchase completed before the end of the stamp duty holiday deadline at the end of March 2021, now is the time to get your application in; otherwise, you may be too late. You can read more about current lender service times in our blog, here.
If you are concerned about repayments but aren’t sure about taking a payment holiday, there are other options available. Our advice is to speak to your lender or broker about what might be a suitable alternative for you. Similarly, if you’ve already taken a mortgage payment holiday this year and are now looking for property finance, do speak to a broker about which lenders will consider your application as lenders have differing rules about applicants who have taken one.
If you have any investment plans or wish to discuss ways to reduce your monthly mortgage repayments, you can speak to our experienced teams on 0345 345 6788 or email them, firstname.lastname@example.org.