How will the new tiered restrictions impact the property market?

Today, the Prime Minister announced a new set of guidelines for tackling coronavirus. The government has put forward a tiered system of restrictions for England. The ‘traffic-light’ style system has three levels:

Medium

The the default level for all areas in England

• A maximum of six people can meet together (the Rule of Six)
• Pubs and Bars have to close at 10pm

High

• No meeting with other households indoors
• The rule of 6 applies to meetings outdoors
• Most areas already in local lockdown will go into this tier

Very High

• Households are not allowed to mix either indoors or outdoors
• Pubs and bars will close completely (and potentially other hospitality, and leisure facilities, depending on negotiations with local leaders)

Under all of the tiers shops, schools, and universities will remain open.

I’m in a very high alert area, can I still move house?

The latest government advice does still allow people to move house, even if they’re facing local restrictions.

Estate agents, letting agents, and removal firms are all still allowed to operate too, so you shouldn’t see too much change logistically. However, if you’re in a high or very high alert area, you might find that estate agents suggest virtual viewings before you come and visit a property.

Attending house viewings will not technically count as ‘households mixing’ under the new rules, but you and any estate agents must follow coronavirus guidance closely. This includes wearing masks, washing hands, and maintaining social distancing during viewings, and when working with removals companies.

Likely impact of the tiered lockdown on the property market

It’s hard to say exactly how far tighter local restrictions will impact the housing market, but we’re unlikely to see a full stand still of activity like we did with the first national lockdown.

We’ve been tracking the property market throughout the coronavirus pandemic, and looking at the trends from the areas that faced local lockdowns over the past few months, we can get a sense of what the impact might be. This is what we’ve found:

Greater Manchester

• Faced stricter local restrictions from July 31st

Since the end of July, there have been 142 new properties added to the market in Greater Manchester. This amounts to about 57 a month. In contrast, from January to the end of July there were about 77 new home sellers entering the market each month. This average includes the UK-wide lockdown, when the housing market ground to a complete halt.

Clearly we can see some caution amongst sellers broadly correlating with the local restrictions.

Leicester

• Faced stricter local restrictions from June 30th.

Currently we’re seeing about the same amount of new properties coming to the market as before the stricter local restrictions were put in place (about 105-108 a month).

The tougher local restrictions in Leicester came in much earlier than elsewhere, and have been eased slightly. It’s likely that this has given sellers more time to overcome their initial anxieties.

Durham

• Local restrictions came in on September 18th.

We’re currently seeing about half as many listings per day in October than we were in September - but as restrictions only came in about a month ago, it’s still a little early to draw conclusions about how far this is correlated with the lockdown.

Sunderland

• Local restrictions came in on September 18th

Sunderland has also seen a reduction in the numbers of new homesellers coming to the market each day, since restrictions were introduced. However, the drop has been less significant than in Durham, at 26% fewer.

Liverpool

• Faced implementation of stricter local restrictions from 22nd September.

Surprisingly we’ve actually seen more listings per day in October than we saw in September (17 vs 13), suggesting that local restrictions have had little impact on homeseller sentiment in Liverpool. However, like with the North East, it’s still a little early to draw concrete conclusions.

Our local market tracker can help you see what's happening in your area. Head there now.

Key Takeaways from Co-founder and CEO of GetAgent, Colby Short

‘Lockdown restrictions have inevitably created an atmosphere of caution amongst homesellers in many areas.

But, the property market has remained remarkably robust and activity is continuing everywhere. Buyers keen to take advantage of the Stamp Duty holiday remain undeterred, and for many people moving house is as much a necessity as a choice.

We expect this trend of cautious activity to continue as the local tiered restrictions come into place.’