How Will Regional Lockdowns Affect Your Property Investment Plans?
With a government announcement on further regional COVID-19 measures due early next week, we want to help investors prepare for what this could mean for their current and imminent mortgage applications. Taking what we learnt from the UK-wide lockdown back in March, Steve Olejnik shares his advice to make sure your investment plans stay on track.
It’s fair to say that back in March and April, like so many industries, the property industry was thrown entirely by the effects of lockdown, resulting in a frantic scramble to adjust. As cases of Coronavirus across the UK, and indeed Europe, continue to rise once again, the Government is announcing new restrictions early next week. Although lenders are now (mostly) set up for working from home, and processes for desktop valuations already implemented (unlike in March), there may still be some significant disruption for property investors.
At the moment, we expect these restrictions to be regional and working on a “traffic light” system. According to the BBC, the levels of lockdown could be:
Level One: (fewer than 100 cases per 100,000) Baseline, minimum restrictions applicable to all of England, including social distancing and “rule of six”.
Level Two: (cases above 100 per 100,000) A ban on household meetings.
Level Three: (significantly higher rates of transmission) A full lockdown; excluding schools and essential business, like supermarkets.
Until we have exact guidelines for each tier, we have to assume that areas under a level two could impact valuers visiting properties. However, perhaps with the RICS COVID health and safety guidelines, this will still be possible. On the other hand, we imagine that any areas under level three will not be able to complete physical valuations at all.
How could this impact property investors?
Just like in March, if we see more areas going into level two and especially level three lockdowns, and valuations cease, there will be significant delays to any ongoing and new mortgage applications. And, as we saw when valuations resumed back in May, the knock-on effect is yet further delays while appointments are set up, often with fewer surveyors available to complete the inspections.
What can you do to decrease delays to your mortgage application if there’s another lockdown in your area?
Quite simply, get your mortgage applications in now. If you have any outstanding valuation fees, make sure to settle them too. By doing this now, your case will be first in line when restrictions lift again, meaning you’ll hopefully experience less delay. As we saw back in the spring, the later you join the queue, the longer you’ll have to wait for completion while lenders clear the backlog.
We believe that it’s better to be over-prepared in these times of uncertainty. If you’ve found a property and are yet to finalise your mortgage finance, or if you’re sitting on a mortgage application that needs submitting, get in contact with our team on 0345 345 6788 or email enquiry@mortgagesforbusiness.co.uk, and they will be able to get the process underway now.
9th October 2020
