Covid-19: Govt puts the brakes on housing market

Covid-19: Govt puts the brakes on housing market

The government edged closer to suspending the housing market yesterday as it told those in the early stages of buying or selling to delay the process and that no visitors were allowed into properties for the time being.

An update from the Ministry of Housing, Communities and Local Government last night (March 26) said those already involved in a home move should delay moving to a new house while measures were in place to fight the coronavirus.

Those looking to sell were told to “use this time to start gathering together all the information you will need”. The government said no visitors were allowed into properties while the UK remained on lockdown, including estate agents, surveyors or potential buyers.

It added: “You can speak to estate agents over the phone and they will be able to give you general advice about the local property market and handle certain matters remotely but they will not be able to start actively marketing your home in the usual manner.”

Those whose properties are already on the market are able to continue to advertise but are not allowed to let people visit the property for viewings.

The government also told movers who had already exchanged contracts to work together with “all parties involved” to agree to a delay until after the stay-at-home measures had been lifted.

UK Finance, the banks’ trade body, confirmed lenders were working to find ways to enable customers who need to delay their move to extend their mortgage offer to enable them to move at a later date.

According to FTAdviser’s sister paper, the Financial Times, banks are pressing the government for a full suspension of the housing market.

The FT reported that banks have expressed concern about the impact of the pandemic on valuations and about granting credit when the economy is in free fall.

Funds from lenders have dried up over the past few weeks as banks and building societies pull back on new mortgages.

Major lender Barclays has limited the amount of mortgage applications it is accepting from brokers in a bid to restrict the flow of applications through its case booking process and has limited its high loan-to-value products.

Lloyds Banking Group — which includes Halifax, Scottish Widows and BM Solutions and is the UK’s largest lender — has capped its maximum lending at 60 per cent LTV while Vida Homeloans and Together Money have halted all new mortgage lending.

Nationwide and HSBC have pulled all their tracker mortgage products from the market.

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