Prospects for the
The property market is unnaturally buoyant at the moment, writes Mark Hayward,
Chief Executive, National Association of Estate Agents.
Coming out of the Covid-19 lockdown, we anticipated
there would be a spike in activity in the property market.
In fact, there seems to have been a wave and, as I write
this at the end of July, that wave does not show any signs
After restrictions on the property market were eased,
NAEA member estate agents have seen average increases
in sales of 10% compared to previous months. For many
June was their best sales month since February 2016,
with 10% of sales going over the asking price and the
average discount between asking price and achieved
price was less than 2% below, which was more or less
replicated throughout the country.
House buyers redefine their priorities
As a result of the lockdown and the subsequent return to
the ‘new normal’, we are seeing signs of house buyers
assessing what they want to do with their lives and how
and where they want to live.
There is a noticeable trend to move out of urban city
areas to more rural areas, with an increase in demand
in areas like the South West, South East and even
Shropshire, and generally this is in all price categories.
There is a realisation that many office workers will no
longer be commuting to their offices on a five-day-per-week
basis; some may never go back and some may go
back infrequently. We are seeing more people wanting
to move out of flats and into houses with outside space
and possibly an additional room to work from.
26 Removals & Storage September 2020
Challenges to a buoyant market
Based on the evidence we are seeing in our branches,
housing demand is up by nearly 25% from June last
year. What we are not seeing is a huge uptick in the
number of houses coming to the market, which means
we still have the imbalance of supply and demand,
which we have had for at least the past two years. People
are reluctant to put their houses on the market until
they find something to buy.
The stamp duty holiday until 31 March 2021 has
been a welcome added incentive. It allows people to
plan and move forward, powering through potentially
difficult times predicted for the end of this year. However,
given it can take on average around five months from
a house going on the market until a completion takes
place, there is still the risk that purchasers are unlikely
to meet the 31 March deadline.
There is concern in the property sector about how
long the current activities can be sustained in light of
impending and already announced redundancies in
workforces, the lessening of the furlough support and
the economic outlook and its impacts on employment.
Brexit put a break on the market until the end of
last year. We don’t yet know whether the implications
of Brexit will come into the forefront of people’s minds
towards the end of this year.
Another uncertainty is how long Covid-19 and its
impacts will last; clearly if we have a second wave there
are likely to be significant implications for the property
market. From our experience with dealing with local
clusters, such as in Leicester, as long as the protocols
are in place and everyone adheres to the guidelines this
should not be an issue for local property markets and
the removals industry.
Getting the property market moving
The property sector and the removals sector are
intrinsically linked to one another, and increasingly we
are working more closely on a number of initiatives.
We are pleased to work alongside the BAR in the Home
Buying and Selling Group (HBSG, see page 27) which
brings together industry and government to find
solutions to make the process of home buying and
selling cheaper, faster and less stressful.
To speed up the buying and selling process, we are
very much pushing for upfront information to be
available so that when a property goes onto the market
it is not only market-ready but also sale-ready.
The HBSG is looking at how to achieve earlier binding
commitments from buyers and sellers to provide incentives
and certainty through what is known as reservation
agreements. The Government was due to trial this in
England but it has been put back for the time being.
We believe it is in no-one’s interest to have
simultaneous exchanges and completions – there
needs to be a proper time for people to prepare to
move. Historically it was 28 days between the two
stages. If we can reduce the time it takes to get to
an exchange of contracts there is no reason why the
second stage cannot revert to 28 days. This has worked
very successfully in Northern Ireland where we have
managed to get the time scale to eight to 10 weeks
“Post-Covid-19, people who
move may well be more
disposed to changing their
outlook on what days of the
week to move. Although
traditionally people like to
move on a Friday so they can
be up and running to go back
to work on a Monday, the
removals sector would benefit
greatly if they could do moves
six or seven days of the week.”