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Moving house during coronavirus the new lockdown rules explained

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Fri 15 May 2020

Moving house during coronavirus the new lockdown rules explained

Before he got out of bed on Wednesday morning, Jeremy Gee had already booked viewings for £24.5 million worth of London property. The managing director of the luxury estate agency Beauchamp Estates had received 15 emails and 17 voice messages from prospective buyers, and had six new homes to sell before he had even brushed his teeth.

After almost two months of lockdown, the housing market was open for business. Pent-up demand has meant an estimated 450,000 buyers and renters are thought to be waiting in the wings. Between 10pm and midnight on Tuesday, the day when the government made the surprise announcement that physical viewings were allowed to go ahead under social-distancing guidelines in England, Knight Frank’s country department received eight calls from sellers wanting to put their homes on the market. Within one hour of opening its phone lines, Andrews, an agency with 50 offices in the south of England, received 226 calls for viewings or valuations.

“It’s a restart, but it’s also a very changed housing market world that we are all stepping into,” Gee says. Richard Donnell, the research and insight director at Zoopla, agrees. “This is an optimistic move, but it will take time to build momentum. It won’t be a fully functional, fully operating market.”

The Old Rectory in Siston, Gloucestershire, near Bristol, has seven bedrooms, stabling, a lake and six and a half acres of land. It went on sale on May 12 for £2 million through Knight Frank
The Old Rectory in Siston, Gloucestershire, near Bristol, has seven bedrooms, stabling, a lake and six and a half acres of land. It went on sale on May 12 for £2 million through Knight Frank

The way we buy and sell homes is not going to look the same either. Harrods Estates will reopen branches on Monday with Perspex screens for reception staff. Jackson-Stops, a UK-wide agency, says it will only arrange visits once it has enough PPE and hand sanitiser and its sellers are on board with the new rules. Here’s what you need to know.

What will happen to house prices?
There is a lot of expectation that property prices will drop. Forecasters have been busy crunching numbers, with a consensus emerging that there will be a decrease of 5 to 10 per cent this year — with the worst-case scenario from Lloyds Banking Group, of a drop of 10 per cent this year and a total fall of 30.2 per cent over three years, thought unlikely. This would be worse than the 19.4 per cent decline during the global financial crash.

However, the reality is that no one knows what will happen. Property prices were frozen when the market closed. What happens next is what Lucian Cook, the head of residential research at Savills, calls “the acid test” — whether people will push for discounts or renegotiate offers. Property prices depend on consumer confidence. If lots of people are hit by financial hardship, we will see prices slowly ease down.

Initially, though, many sales that go through will be those that were stuck during lockdown, and most are expected to continue at agreed prices. Some will still fall through if buyers’ circumstances have changed. For example, if they have been furloughed.

What do I do if my buyer wants to renegotiate the agreed price?
It depends how much you need to sell, and whether you think you can find an alternative buyer easily. It is legal for a buyer to try to renegotiate the price before contracts are exchanged, a practice called gazundering. However, if the buyer pulls out of the sale after contracts have been exchanged, they are in breach of contract and you can sue them for any loss this causes, and you may be able to keep the deposit. If you agree to a lower price, the buyers’ mortgage lender may also want to revalue the property.

What do I do if I have a house viewing and need to socially distance?
When Robert Jenrick, the housing secretary, declared the market open he mentioned paper towels eight times. We should think about drying our hands as much as about washing them, and that means separate towels, or, indeed, paper towels for the people who would like to buy your home.

Fresh to the market, this five-bedroom semi-rural house in Chiddingstone in Kent is on sale for £1.375 million (Knight Frank)
Fresh to the market, this five-bedroom semi-rural house in Chiddingstone in Kent is on sale for £1.375 million (Knight Frank)

Other advice published by the government urges sellers to leave properties — which is much easier to do now that we can go outside whenever we like — while viewings are happening. Surfaces should be cleaned before and after viewings and doors left open so that visitors do not have to touch handles to access different parts of the property. Use the knuckles of your fingers to touch light switches and any buttons in lifts. Buyers should do their bit by avoiding surfaces and handles, and carrying hand sanitiser.

Only bring members of your household “that absolutely have to be there”, but if children must attend, then parents will have to do their best to keep them away from surfaces and make sure they wash their hands. If a couple wish to view, but are living in separate households, they should book separate viewings. Purchasers can visit a property more than once and send tradespeople in to do inspections, but social-distancing guidelines must be observed.

Estate agents are allowed to attend viewings and visit homes to take photos, but they must keep their distance too.

If anyone involved in the buying process develops coronavirus symptoms at any point, they should halt the process, postpone viewings and visits from tradespeople and agents, and self-isolate for at least seven days. People who are over 70, or those with underlying health conditions that make them vulnerable to the virus, should think carefully before moving house and seek medical advice if they are unsure, as some moves, such as to new-build or empty homes that you can travel to in your own car, are lower risk than others.

How can I cut down the number of viewings?
To minimise the number of times you will be entering other people’s houses, the government encourages agents to arrange viewings via video conferencing apps such as Whatsapp, Zoom or Facetime in the initial house-hunting stages. Usually this involves a seller showing the buyer around their home on their smartphone, often with an agent on the line to answer questions.

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Some estate agencies have invested in costly virtual imaging cameras to create accurate floorplans and 3D simulations of properties, or have filmed short video tours inside. The agents we spoke to that offered this service said the cost was included in the estate agent’s fee as part of their standard marketing package. Sellers can opt out, but if they change their mind and opt in at a later date, they may be charged a one-off fee.

Andrew Perratt, the head of country sales at Savills, says it’s a good idea for sellers to do a run-through with the agent to banish any nerves. Always hold the phone in “portrait” position so the buyer can see the height of the property. Keep the camera still with two hands and move slowly, so you don’t give the viewer motion sickness, and don’t forget to show the garden, if you have one.

You can choose to put the video out on property portals, or request that your selling agent only shares it with serious house hunters.

What will happen if someone in my chain gets ill, or if there is a second lockdown?
Buyers and sellers should build a get-out clause into contracts in case of a Covid-19-related event, advises Lucy Barber, the head of residential property for Forsters. This event could include illness, or delay of removals or fund transfers owing to illness or lockdown. Your contract could include a back-up completion date, for example ten days after the Covid-19 event is over, subject to the buyer still having a mortgage offer. Build in a long-stop completion date as well: for example, December 25. If the coronavirus event is continuing, then either party can back out with no loss of deposit or interest charges.

This two-bedroom house in Chapel Stile, Cumbria, is one of 2,000 properties to come to the market this week and is on sale for £400,000 with Ashdown Jones
This two-bedroom house in Chapel Stile, Cumbria, is one of 2,000 properties to come to the market this week and is on sale for £400,000 with Ashdown Jones

The other option for buyers and sellers is to do a simultaneous exchange and completion on the same day. This only works if you are moving into a vacant property, or if you don’t have to move into the property on the day of completion.

How can I speed up the process?
Buyers and sellers want to get property transactions done fast in case there is a second wave of coronavirus, according to Donall Murphy and Morris John, partners at Russell-Cooke. The main pinch points could be difficulty gaining access to properties and a surge in movers, resulting in competition for searches, valuations and surveys. John says: “Get your solicitor, valuation and survey organised pronto. If you are selling, get all paperwork ready.”

Large surveying firms have furloughed staff, which could slow things down, says Annabel Dean, a partner at Farrer & Co. She advises booking a removals firm well in advance due to a backlog of demand. However, if the guidance is effective then she says: “We anticipate normal timetables will resume, so six to eight weeks from terms being agreed to completion.” She advises getting your searches done at the earliest opportunity. “Oddly, drainage and water searches seem to be taking a particularly long time right now.”

The biggest delay will come from local authority searches, adds Nick Stone, a partner at Wedlake Bell. “There will be more contracts conditional on local authority searches being returned in time. Some lawyers already do this as a matter of course in Camden [north London], which is notoriously slow with searches. This practice may now be extended across other local authorities.” Don’t be tempted to use cheap online conveyancers, or lawyers who are hard to get hold of, Stone adds, because Covid-19 clauses are complex.

How do I minimise contact when witnessing and signing paperwork?
Savills Ireland has just launched “Savills Live”, which lets buyers sign contracts with encrypted digital signatures. Traditionally, though, “wet ink” signatures are needed on sale documents. However, the Land Registry has said that until the end of the pandemic you can scan a signed copy of the agreement and send it in an email to your solicitor or conveyancer.

In Forest Gate, east London, this three-bedroom house is close to transport and green spaces. It is on sale through The Stow Brothers for £625,000
In Forest Gate, east London, this three-bedroom house is close to transport and green spaces. It is on sale through The Stow Brothers for £625,000

Mark Loveday, a barrister with Tanfield Chambers, says: “For the duration of the pandemic the Land Registry will accept scanned manuscript signatures. It will also allow a wider range of people, such as teachers and police officers, to verify individuals’ identity for land registration purposes.”

A witness will have to view the signing from a 2m distance, then sign the document with a different pen, or wearing disposable gloves. Some solicitors have recommended that a neighbour can view signing through a window, or, if outside, while sitting in their car.

How can I move house safely?
Just like everyone else, home removal companies were taken by surprise this week. Ian Studd, the director-general of the British Association of Removers (BAR), says they have been focused on “making appropriate preparations” and getting ready for the reopening. Last week the government amended its guidance to include maintaining a 2m distance, wearing masks, keeping windows open to maximise ventilation, providing WC access and possibly a shower for workers, and providing a kettle for workers (although they should bring their own mugs and teabags). A deep clean is also recommended — or try to leave 72 hours between people moving out and new occupiers moving in. Everyone should make sure that keys are sanitised at handovers.

Studd says that movers may “have to pay more” because “the need to respect and comply with the additional safety measures will almost certainly add time and resources into the process, and that will need to be reflected in the cost of the service”.

You may also have to join a queue if you want to book a removal. Charles Rickards, the marketing and finance director of the London removal firm Anthony Ward Thomas, and Aussie Man and Van, says that hundreds of people whose removal had been suspended because of the lockdown are now rebooking. “We’ve had a sharp increase of inquiries and we’ve begun to un-furlough staff,” he says. “We are discouraging our workers from using public transport. The danger is still out there.”

Alex and Sophie Knight with their daughter, Agnes
Alex and Sophie Knight with their daughter, Agnes

Alex Knight, 39, and his wife, Sophie, 36, have been trying to move across Leeds ready for their daughter, Agnes, to start her first school.

They wanted to move from their four-bedroom house in East Ardsley into a semi-detached house in the village of Bramhope.

The couple, who own a picture-framing company, had already seen one chain fall apart last year after they lost their buyer. They accepted another offer in early March, and the chain of three — their new buyer, themselves and the family selling the house in Bramhope — began to proceed.

“Then coronavirus marched over the hill,” Alex says. “The estate agent abandoned us. The girl in charge was placed on furlough. We have hardly had any contact since.”

All parties have now agreed to exchange and complete on the same day to speed up matters. Alex says his solicitors have been helpful, but he and Sophie have done much of the hard work. “We even contacted our purchaser on social media as we had no other way of communicating with them. We’ve been acting like our own estate agent. We are keen to get the move done as our mortgage offer is limited to May 24. There are supposed to be extensions, but we haven’t received confirmation yet.”

The removal firm they booked also cancelled because of British Association of Removers’ regulations on social distancing. The Knights received a refund and plan to move themselves. Alex says: “The moment I heard that the market was moving again, my hopes went up. But I’m not holding out hope for this week now, maybe next.”