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TODAY'S OTHER NEWS

Sales to crash by 60% says Zoopla: will estate agents survive?

New sales agreed have already plummeted by 15 per cent and over the next three months there’s going to be a 60 per cent drop in transactions.

The gloomy forecast comes from Zoopla’s research department which says low transaction volumes are already expected to continue into the third quarter. 

Some individual spring months may see newly agreed sales down by up to 80 per cent on the same month last year.

In its latest market snapshot concentrating on 20 major cities, the portal says Coronavirus’ impact on the UK property market is unprecedented, effectively killing off viewings and valuations because of the need for social distancing.

Buyer demand over the seven days to 22 March was down 40 per cent on the level recorded one week prior, the portal says, as would-be home buyers paused.

Purchases already agreed and moving towards exchange of contract are continuing, but Zoopla says a rapidly growing proportion of sales are already starting to fall-through. 

Fall throughs last week were 60 per cent higher than the previous week. Stock is continuing to be listed, although at a slowing rate.

Interest from new buyers has fallen dramatically, but the market has not ground to a complete standstill. Sales continue to be agreed, albeit at a slower rate, down 15 per cent on last week and four per cent below levels recorded a year ago.

A fall in demand is expected to culminate in a reduction in sales agreed towards the end of the quarter and into the summer months, given the time lag between marketing a home to agreeing a sale and completing a transaction - a process that can take four to six months end to end.

However, the scale of the downturn in transactions is dependent on the effectiveness of Government action to support jobs and the wider economy, and whether this curtails an increase in unemployment.

Richard Donnell, director of research and insight at the portal company, says: “We do not expect any immediate impact on prices. Beyond this, the outlook for house prices largely depends upon how the government’s major package of support for business and households reduces the scale of the economic impact. Low mortgage rates mean forbearance will remain the preferred choice for lenders, but further Government support in these unique times cannot be ruled out.

“The timing of any rebound in housing market activity depends upon when new restrictions are lifted, and the extent to which households and businesses are able to return to a normal way of life. Browsing for homes online is set to continue and, while demand for property may rebound quickly, it will take several months for agents to rebuild new business pipelines.”

  • Mark Wilson

    Richard Donnell, director of research and insight at the portal company, says: “We do not expect any immediate impact on prices. - I don't think so? Who would pay the same price today for a property compared to 2 or 3 months ago? And a drop of 60% in sales headline, two optimistic statements!

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    I question why someone would not basically pay the same price as 2 to 3 months ago? Is a key driver of price not stock vs demand? Once things settle, I see few reasons why prices should drastically change. Short term not much will change, we are where we are. Longer term, it all depends on how the economy bounces back and how many may not have a job to return too.

     
  • Rollo Miles

    Let’s not sugar coat what is happening, we are in unprecedented times. It is not just sales which are crashing but Lettings as well!
    Most tenants we are looking after have been calling asking for rent holidays or to break their lease.
    We have properties under offer where buyers are pulling out, we have properties which have exchanged where buyers no longer want to complete. Where we do have applicants who want to view available stock we can not show it.
    We still have to look after and deal with the public and try and resolved daily problems in our managed stock.
    When it comes to government help, it’s a load of crap! Banks are asking for personal guarantees in order to lend , even if the government said it would guarantee
    80% of any loans given out . When it comes to pay most of my colleagues who work in branch get a very small basic salary and the rest is commission based so 80% up to 2500 will not really help them . As for all the poor self employed agents, contractors there is zero help at the moment . So yes this will be a game changer for estate agents across the country and for a lot of other businesses as well. Not happy times at all. It makes the 5 years of Brexit uncertainty a distant memory.

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    Maybe we should all just stop allowing fake news headlines and take time to see what’s what, if you tell people that’s going to happen they’ll make it happen, just enjoy some good new stories and stop mentioning portals in storages they don’t need the promotion or attention when they scaring people and the industry.

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    Portal says things are bad. This headline would have sufficed, we know the rest.

  • Paul Singleton

    And yet Zoopla are still charging agents a full subscription rate in April.

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    The chances of house prices diving far outweigh them rising or even staying the same. Most people will come out of this in a far worse financial position than a they were, lower incomes and less mortgage available, debts, and grimly, probably increase supply from probate and people having to sell etc's. Any price drop will be proportional to the length of even partial lockdown. Those that think the market will just carry on in a a few weeks time are deluded.

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