Residential Market: Life after lockdown
At the beginning of the year the market had one of its most promising starts since 2016 and had been looking to be extremely active. According to Rightmove, pre-lockdown sales agreed from the beginning of the year to 23rd March were 11% up on the same period last year.
It is inevitable that the market will take some time to fully recover from the Coronavirus crisis. Quite apart from the heartbreak of lives that have been cut short, many people will now be reviewing their financial situation.
We do expect underlying demand for housing in Essex and Suffolk to remain high however and from speaking to our clients we believe that the majority will resume moving plans once it is safe to do so. For those who are still motivated to move we may see some ‘pent-up demand’ being released to create a much-needed flurry of market activity in late summer and autumn.
Will Help to Buy be extended?
The Homebuilders Federation, whose members deliver around 80% of new homes per year, is reportedly liaising with the Government about a possible extension to Help to Buy. The equity loan scheme cuts the deposit required by first-time buyers of new homes to 5%.
It is thought that the lockdown will prevent the construction of around 200,000 new homes across the UK so extending the Help to Buy scheme would provide a much-needed boost.
Will Stamp Duty still apply?
The Government are being urged to offer a stamp duty holiday to buyers to help kickstart the market after COVID-19.
The Royal Institute of Chartered Surveyors (RICS) have been among the first to call on the Government for this because potential homebuyers are likely to be under financial strain when lockdown is over. This could help to reactive the market as a short-term measure. After the 2008 financial crash, a 12-month stamp duty holiday was announced to boost the housing market.
Once the crisis is over, we expect to see a change in people’s attitudes to how and where they work and live. We will continue to provide support to our staff and keep teams in place should you need any help or advice. You can find details of how to contact us during COVID-19 here.