Locked in by lockdown?
Lucy Owen, Partner and Head of Resales:
In short, the answer to whether buyers and sellers can look to carry on their house moves is a big fat YES! You don’t have to read the rest of this article now… but please do.
The Government has issued guidelines regarding house moves during the lockdown period, the links for which are at the end of this article. Roughly, the guidelines translate into that if social distancing measures can be adhered to, then moves can proceed if it is critical for them to go ahead. Effectively, this means that New Build purchases can proceed pretty much as normal as properties are vacant and therefore minimal contact with other people is required for the move.
In the New Build Shared Ownership Department of Direction Law, we have still been able to complete around 100 transactions in April for those clients whose moves were critical. Innovative ways of handing over the keys have been thought of by housing associations, for example using key boxes and texting the passcode to the buyer once completion has occurred.
Housing associations are also conducting virtual tours of properties and agreeing lower reservation fees in a bid to keep the housing market flowing.
In the Resales Shared Ownership Department of Direction Law, we are also completing those clients who have either already exchanged Contracts and are unable to delay the completion date until after lockdown, or those clients whose moves are critical and can adhere to social distancing guidelines. With all other transactions, we are progressing them to the point of exchange as far as possible. Fortunately, we often deal with the same solicitors in the affordable housing conveyancing world, and it’s safe to say the fantastic relationships that we have developed over the years are really paying off now in terms of helping each other throughout this difficult period.
The majority of staff in solicitors’ firms are working remotely (including our own staff where they can) meaning that those firms who mainly send documents through the post rather than email are unable to now. Emailing documents has the benefit of not only reducing any delays or lost post, but also makes administrative assistants much cheerier as time at the photocopier is reduced – happy days!
Mortgage lenders are also rapidly changing their stance. At the beginning of lockdown, several lenders withdrew some of their higher loan to value mortgage products. There was also concern that existing mortgage applications could not be completed as surveyors were unable to inspect properties. However, at the time of writing, mortgage lenders are now putting back in place their higher loan to value mortgage products (notably Nationwide and Halifax) and are using digital valuations instead, or as well as physical ones.
Despite Michael Gove’s statement that people should “stay put”, this clearly isn’t a correct reflection of the Government’s current guidance (and makes him as popular with home-movers as it did with teachers when he was Education Minister).
In fact, I’ve personally found the negative and somewhat misleading reporting of the position in terms of the housing market somewhat soul destroying as panicked clients have contacted me thinking they were going to lose out in their transaction. Thankfully I have been able to reassure them and generally we have had very few people withdraw from transactions. Those whose transactions are at the point of exchange, but whose moves are not critical, or who are unable to move during lockdown are just on pause, and the play button will be pressed swiftly once lockdown is over.
Overall, the housing market and its partners in crime are coping admirably well in this crisis – in fact everyone is showing off in their ability to come up with alternative solutions in how to keep matters moving. It may well be that things will never be the same again in terms of how we deal with the whole process, from the start point of viewings to the end point of completion; but as long as we can aid our clients in fulfilling their dream of home ownership, then quite frankly who cares how we meet the end point? Whether it’s in the office or working remotely in fancy dress!
Lucy Owen, Head of Resales, Direction Law (dressed as a banana, progressing transactions)