New Covid clampdown will push people to sell says leading agent

A leading agent says the government’s new Coronavirus clampdown from Monday will push more home owners to sell.

Caspar Harvard-Wills, a partner at the London agency Black Brick, says the latest restrictions will focus the minds of many unhappy at spending what may be a very challenging winter in their existing homes. 

He believes the issue may be particularly keenly felt in London.

“Many owners and tenants will be weighing up whether the additional cost of living in Zone 1 is now worth the premium, with many working from home until at least the early part of next year and restrictions on socialising” he says.

And Harvard-Wills adds: “It is surely inevitable that we will see a move into the outer parts of London or further afield.”

His views are echoed this morning by the monthly Royal Institution of Chartered Surveyors market snapshot which confirms the current surge in buying activity, with substantial growth in demand for homes with gardens. 

The RICS exercise is a sentiment survey of how surveyors and agents feel about key market activities.

A net balance of 63 per cent of respondents reported an increase in buyer interest over the past month, although the longer-term view remains more cautious.

As buyer enquiries continued to rise, new instructions also saw a jump, with a net balance of 46 per cent of survey participants noting an increase in vendors listing property to sell.

Consequently, strong growth in agreed sales was cited for a third successive month, with a net balance of 61 per cent of contributors seeing a pick-up. 

Looking ahead, sales expectations remain modestly positive but 12 month sales projections are still in negative territory, with the net balance of minus 17 per cent. 

And RICS insists that the pandemic is expected to cause a lasting shift in the desirability of certain property characteristics, as more than four in five respondents anticipate demand increasing for homes with gardens over the next two years. 

A similar proportion predicts rising demand for properties near green space.

The RICS survey also points to a sharp acceleration in house prices: a net balance of 44 per cent reported an increase in prices, the strongest reading since 2016. 

This is up from a net balance of 13 per cent in July and marks a turnaround compared to minus 33 per cent registered back in May. 

Consequently, strong growth in agreed sales was cited for a third successive month, with a net balance of 61 per cent of contributors seeing a pick-up. 

Looking ahead, near term sales expectations remain modestly positive, but 12 month sales projections are still in negative territory, with the net balance coming in at minus 17 per cent. 

Meanwhile, the pandemic is expected to cause a lasting shift in the desirability of certain property characteristics, as more than four in five respondents anticipate demand increasing for homes with gardens over the next two years. 

A similar proportion predicts rising demand for those properties near green space.

The RICS survey also points to a sharp acceleration in house price inflation: a net balance of 44 per cent of respondents reported an increase in prices, the strongest reading since 2016. 

This is up from a net balance of 13 per cent in July and marks a dramatic turnaround compared to the reading of minus 33 per cent registered back in May.

Almost all parts of the UK are now seeing prices increase: the only exception is London, where prices have remained more or less flat over the past two months.

“The results provide a further pointer to more substantive changes taking place in household behaviour in the wake of the pandemic. Increased demand for properties with garden and near green spaces has if anything increased since we tested the water in May” according to Simon Rubinsohn, RICS chief economist.