Keiran Dunne, financial planner and mortgage specialist at Ryley Wealth Management, unpacks his tips for house hunters and property owners in the wake of the current Covid-19 pandemic.
It goes without saying that the current coronavirus crisis has cast uncertainty over so much of everyday life, and that’s as true in the property world as any other. With the whole country in the midst of a widespread unprecedented lockdown, if you’re a homeowner looking to sell or a house hunter looking to move, it may feel like you’re currently in a state of limbo, unsure of what to do next.
If this sounds familiar, here are a few tips to help guide you through these uncertain times.
Make the most of mortgage brokers
If you’re thinking of moving house soon but are yet to start the mortgage application process, it’s best to speak to a mortgage broker first to talk through your future options. Most mortgage brokers are still open for business remotely and would be happy to discuss your individual options over the phone or via video conference.
It’s also worth noting that some lenders may have changed their lending policy temporarily as a result of Covid-19. Don’t assume it’s just a case that they’re unable to help you, as there are plenty of options out there depending on your situation.
Although no one knows for certain when things will start to return to normal, there’s no harm in still applying for an agreement in principle and searching for properties on the internet through sites such as Rightmove and Zoopla.
However, it’s worth bearing in mind that it’s unlikely you’ll be able to proceed with the full application process, as valuations and house moves are temporarily on hold. Again, a broker could advise you further about how far you could proceed and what the best course of action is depending on your individual circumstance.
In the middle of a house purchase? – Don’t panic!
As per the latest government advice published on 26th March 2020, people are being asked to be flexible and only move where essential. This includes if the property being moved into is vacant.
Where the property is occupied, people are being encouraged to delay the move and to further support this, the Land Registry has temporarily closed registrations for new purchases to prevent completions. The best advice is to speak to your conveyancer who will likely suggest speaking with all parties involved and a new date, post lockdown, can be agreed.
Don’t panic if the offer expiry date is due, lenders are being really flexible right now and they are often agreeing to extend offers by up to three months.
Mortgage Holders - here’s what it could mean for you
Applying for a mortgage holiday will have no impact on your credit file as long it is arranged properly through your mortgage provider. This will mean speaking with the lender to set it up, as opposed to just cancelling the direct debit. People do need to be aware that their payments may increase after the payment holiday, so make sure you check all the details with your lender first.
But, don’t think a payment holiday is the only option. Spring is traditionally a popular house buying season so there will be many people who have fixed rate deals coming to an end over the next three months or may already be on their lenders standard variable rate. There are plenty of options out there such as a product transfer with your current lender, or remortgaging with another lender. Again, it’s always worth speaking to a broker who will be able to give you the best advice for your individual circumstances.
Sellers, sit tight if possible
If you’re planning on putting your property on the market, now is probably not the best time to do so. People won’t be able to view your property and estate agents sometimes say the longer a property is on the market, the more it can negatively impact the value. Unless it’s essential to sell and move right now, it might be best to sit tight and wait for the lockdown restrictions to be lifted.
Talk to your solicitor to understand what options you have available. Communicate effectively with all those involved in the chain to sort a new completion date, post lockdown if possible, so you all know where you stand. If you’re concerned about buyers in the chain pulling out, then remember all parties will likely be feeling the same. Talk to each other to eliminate those concerns.
Though the property market might seem like a minefield right now, it’s worth bearing in mind that this will not last forever.
Everybody will have different opinions about what the future will hold for the property sector post-coronavirus, but my own opinion is that it will create opportunities for both buyers and sellers. The hope is that transactions already lined up will continue to go through. However, some properties will be remarketed as a result of buyers pulling out so it may present an opportunity for buyers to negotiate favourable prices.
Please note that clicking a link will open the external website in a new window or tab. Links from this website exist for information only and we accept no responsibility or liability for the information contained on any such sites. The existence of a link to another website does not imply or express endorsement of its provider, products or services by us or St. James's Place.