The property market was effectively frozen when the drastic measures to help halt the spread of the disease were introduced four weeks ago. But estate agency bosses are hoping they will be given the green light to re-open early next month.
You do not have a functioning market when buyers can’t buy and sellers can’t sell
And there could be good news for buyers with some analysts predicting bargains appearing on the market as it starts to recover from the coronavirus crisis.
Whether prices fall when lockdown restrictions are eased, by how much and for how long, depends on wider economic factors, in particular the scale of job losses.
But Rightmove director and housing market analyst Miles Shipside said support from banks and the Government in the coming months will be crucial.
He said interest rates must be held down and banks must be prevented from repossessing homes of people who fall into arrears to avoid a “fire sale”.
Mr Shipside said he also backed calls from the Royal Institution of Chartered Surveyors and the National Federation of Builders for the Government to introduce a stamp duty holiday once the crisis has passed, in a bid to entice nervous home buyers back to the market.
The Government is already in talks with housebuilders about the possibility of continuing Help to Buy for a further year beyond its April 2021 expiry date.
The Government’s equity loan scheme cuts first-time buyer deposit requirements for new homes to five per cent.
Industry hopes of a return to operations received a boost in a report for the Government by Conservative peer Lord Gadhia and Sir Jonathan Symonds, chairman of GlaxoSmithKline.
They suggest a limited re-opening of Britain’s commercial activities with appropriate social distancing measures until an anti-Coronavirus vaccine is widely available in 12 to 18 months time.
Their report states: “The initial focus for reopening the economy should be on sectors that have the greatest multiplier effects with minimum risks – such as coffee shops and restaurants which support agriculture.
“The property market is another that has wide multiplier effects.
“We need to avoid a stop-start economy which would sap public morale and damage business confidence yet further.”
A property bounce that started at the beginning of the year after years of Brexit uncertainty has been wiped out by the coronavirus crisis.
So few new homes have been put up for sale over the past four weeks that property portal Rightmove announced today that — for the first time — it has been unable to produce its regular monthly report on trends in asking prices across London and the UK.
Mr Shipside said: “Given the lockdown and pausing of key activities in the housing market, statistics on the number of properties coming to market, new seller asking prices, and new sales agreed are not meaningful.
“You do not have a functioning market when buyers can’t buy and sellers can’t sell.”
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