The market must be prepared for some transactions to fall through even when restrictions are lifted, according to Richard Pike at Phoebus Software.
Although many housing transactions have simply been stalled due to the coronavirus lockdown, the market must be prepared for some to fall by the wayside even when restrictions are lifted, according to Richard Pike, sales and marketing director at Phoebus Software.
Commenting on the Bank of England’s report that mortgage approvals for new purchases fell in March 2020 to the lowest level since March 2013, Pike said: “After the start we had to 2020 the whole market was buoyant and looking forward to the potential of a return to pre-financial crisis activity.
“No one could have predicted what came next and, as we can see from the March figures, the effect of the coronavirus outbreak started to be felt almost as soon as the lockdown was implemented.”
While the hope is that once lockdown restrictions are ended, those sales that have been stalled will be able to go through, Pike warned that some losses should be expected due to the financial impact of the crisis.
He said: “Despite the fact that many of the housing transactions being reported in these figures were in the pipeline up to three months earlier, it is evident that the lockdown caused some to be stalled.
“The hope is that the transactions that are waiting in the wings will be completed once the crisis is over, but we have to be prepared for some to fall by the wayside.
“We are likely to see an element of caution creep back into the market and fears over affordability, with many people seeing a real knock to their finances, cannot be ignored.
“Nonetheless, we are hearing more positive comments from the government that it is planning an easing of the current measures.
“Whilst, in our own market, we are already hearing brokers reporting an increase in new-build enquiries.
“So, perhaps, this heralds the return of at least a little confidence.”