The housing market was halted on Thursday night by the Government after financial institutions said they could no longer operate properly.
Ministers are discouraging buyers from going ahead with house sales and purchases unless they have already exchanged contracts as part of wider efforts to slow the spread of the coronavirus, saying no one should move unless absolutely necessary.
As a result of the pandemic, homeowners trying to sell their properties face a year of misery as the number of buyers dwindles, estate agents close their doors, banks withdraw deals and house prices falling.
Banks and building societies have agreed to extend mortgage offers where completions have to be delayed as a safety precaution.
Grainne Gilmore, head of research at Zoopla, commented: “The clarity provided by the government announcement is welcome for buyers, sellers and agents who are in the middle of the sales process.
“Agents continue to support their buyers and vendors remotely. But, now that there is some leeway on mortgage offers – with a three month extension from lenders – this will enable some buyers to press pause, and to re-start their purchase once the current social distancing rules are relaxed.”
What does it mean if you’re buying?
You should only consider going ahead with your move in the immediate term if you have already exchanged contracts.
If you have not yet exchanged contracts, the government are advising you to delay doing so.
Banks and building societies have agreed to extend mortgage offers for up to an additional three months to enable customers to move at a later date without losing the deal they had lined up.
If your circumstances change during this period or the terms of the house purchase alter significantly, meaning that continuing with the mortgage would put you into financial hardship, lenders have pledged to work with you to manage your finances as a matter of urgency.
What it means if you are selling?
Putting your property on the market will be more challenging than usual, as you are not allowed to have visitors to your home.
As a result, you will not be able to have estate agents come to take photos or carry out a physical market appraisal, while Energy Performance Certificate assessors are also not allowed to visit you.
If your home is already on the market, you can continue to advertise it for sale, but people cannot come to physically view your property.
Importantly, you are still allowed to accept offers on your property during the current period.
In fact, the number of sales agreed between March 16 and March 22 were only 4% lower than a year earlier.
Source: Zoopla Property News
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