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CORONAVIRUS UPDATE

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By Graham Norwood

Editor, EAT and LAT

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Change - The key to unlocking demand after the lockdown

If it’s really the case that estate agents’ offices could be in the category of High Street premises first allowed to open as the lockdown relaxes, as press speculation has suggested, then the next challenge is to persuade people to buy and sell homes after lockdown.

The practical problems are obvious and considerable: viewings and appraisals under social distancing would be labour-intensive, although these are clearly ‘do-able’, and new guidelines could easily be drawn up by individual agencies or by trade bodies.

A bigger problem, however, is sentiment.

With Coronavirus a clear and present danger for some time to come, with unemployment rising and parts of the economy still effectively shut down, will people be confident enough to buy and sell? And perhaps as importantly, with large scale social pleasures from football matches to VE-Day Anniversary celebrations impossible, will people be in the mood?

As an industry we can do little about the society-wide problems but what is within our grasp - working with those in conveyancing and other sectors - is to make the moving process easier, quicker and less fraught.

If we can convince sellers and buyers there’s no longer a 30 per cent chance that a deal will fall through, if we can say a typical transaction takes just a few weeks after finding a buyer, and if we can say there’s less worry attached to the moving process…wouldn’t that encourage more people to take the plunge and buy and sell in our new uncertain era?

It sounds a vague aspiration but actually much of the work has been done already by a range of complementary groups in the industry.

One is the Home Buying and Selling Group (or HBSG). Prior to the lockdown this group had been considering changes for two years and the findings have been covered extensively in Estate Agent Today and across the rest of the industry press.

This isn’t a lofty body removed from the industry - it consists of agents, property lawyers, mortgage lenders and trade bodies including NAEA and ARLA Propertymark, the Law Society and others, as well as PropTech firms including Rightmove, Zoopla and Reapit.

It’s suggested a one-off document to be completed at the point of property marketing, available to any buyer making an offer, accessible to lenders and reviewed by valuers.

This document includes 12 areas of information completed by the seller or their agent including disputes and complaints; alterations and changes; fixtures and fittings; insurance; boundaries; rights and informal arrangements; and more.

It’s the up-front information - the HBSG says - that addresses early-on in the sales process those problems which cause fall throughs at a later stage.

Likewise, there is NAEA Propertymark’s Sales Protocol Toolkit, already launched in a bid to reduce fall-throughs and dramatically improve transaction times.

The kit has been road tested with 200 completed transactions in the Buckinghamshire, Bedfordshire and Northamptonshire areas - the average transaction time reportedly dropped from as much as 40 weeks to only eight weeks, but the NAEA’s ultimate target is to get that down to a mere 14 days.

The association has already worked with agents, conveyancers, the Law Society, The Property Ombudsman and Trading Standards to finesse the documents involved in the pack.

There are more possibilities to speed up the sales process - several have been researched by the Ministry of Housing Communities and Local Government. Let’s look at these too, urgently.

You get the point, I hope. Put bluntly, why can’t the industry agree to pilot a system across the country over the summer?

Of course there are many vested interests to be confronted, and siren voices will say it would be impossible to undertake such large scale changes in such a short time.

But then six weeks ago, who would have thought Britain would be like it is now?

If wholesale new powers can be given to government and the police, if an entire economy can have a much larger stake for government, and if employment rights can change within a matter of day, why can’t our industry create a smoother way of buying and selling?

Change can happen if people want it to, and the industry would be the winner if sentiment was improved in the long and difficult months to come. Do we have the guts to do it?

Stay safe…

*Editor of Estate Agent Today and Letting Agent Today, Graham can be found tweeting about all things property at @PropertyJourn

  • Don Holmes

    This makes absolute sense, to me/us, but does it to Robert Jenrick. Given that the government have implied the agency world would be one of the first back to work to help re-generate the economy, what better timing than now to roll this out. But someone will need to tell him.

  • Paul Barrett

    The property industry is a massive contributer to GDP.
    As such it should be assisted as much as possible to get working again.
    As such EA as well as all other industry participants need to be assisted to operate the market efficiently.

    Never thought I'd ever suggest saying Govt support for EA now!....................strange times!!!

  • John Durrant

    Key to any recovery will be whether lenders are prepared to... lend. Everyone has to live somewhere so there is always demand. It seems likely that following the end of the lockin there will be a slowish release of the logjam that's building due to pent-up NEED to move. However, demand without the availability of funding is not effective-demand. Demand without funding would depress the market. It seems likely that because of financial distress, there will be increased demand for smaller properties. However, if lenders lend, where demand increases, prices for 'affordable' properties will likely increase to the point that there would be no point moving to a smaller property. If lenders don't lend, the market will be wide open for investors. Given the above scenario, there would be no shortage of tenants wanting to rent - perhaps due to their homes being repossessed. To my mind, the weakest link, therefore, is the lenders. Their behaviour coming out of this will set the scene for decades to come. The Government may need to twist arms so that the lenders support those in need at least until we can get some stability back into the economy.

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    we have this document n Scotland Already. Its called A Home Report!

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