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June 2020

House prices took a £4,000 hit during lockdown, according to Nationwide building society. Jeremy Leaf, principal of Jeremy Leaf & Co, told The Daily Telegraph that a ‘car crash’ hit the property market in May and that the future remains uncertain: ‘The market feels a bit like returning after the Christmas/new year break, with buyers and sellers waiting to see who will blink first as prices establish their post-Covid level.’ He added that the process of buying and renting has slowed given the need to take precautions and the establishment of virtual viewings. ‘Some people are making a decision based on virtual viewing, but those are few and far between,’ he added. He explained further in The Evening Standard: ‘[While Nationwide reports the largest monthly fall in prices for more than 11 years], this nadir seems to have marked the bottom as activity and especially new listings have improved considerably since lockdown restrictions were eased but viewings are understandably taken longer due to infection concerns.'

Meanwhile, HMRC's figures tallied with the Nationwide's, revealing that half the number of residential properties were sold in May compared with a year ago, thanks to lockdown measures. Jeremy Leaf told Sky News: ‘Looking forward, listings are increasing which is encouraging and likely to bring more balance.’ He expanded further when talking to BBC News: ‘[But on the other hand], we have concerns that most of the demand is for smaller family houses rather than smaller flats as aspiring first-time buyers remain concerned over future employment prospects post-furlough.'

Unsurprisingly, given the restrictions introduced by lockdown, homes with a garden have become the new must-have for buyers, according to the latest RICS survey. Jeremy Leaf told This is Money: ‘We are seeing more demand for smaller family homes where buyers are taking a longer-term view of market prospects. The reality is that many sellers are reluctant to reduce the price substantially as around four out of five tend to be buyers too. They will only consider price drops if they secure a similar good deal on their next property. Overall, first-time buyers in particular seem more nervous about employment prospects as the furlough support falls away.'

Boris Johnson has set out his vision for rebuilding the UK after the pandemic. Jeremy Leaf told City AM that though the plans were welcome, further detail on the scheme was needed. ’So many of the larger schemes in particular are mired in planning or lending red tape so certainly the concentration on infrastructure will help to release many from that log jam by improving connectivity,’ he said.

Rightmove also had some more positive news to report about the property market rebounding since agents in England were allowed to return to work. Jeremy Leaf told The Express: ’What’s interesting about these figures is the continued shortage of available family houses, which coupled with a two-month enforced confinement and record low interest rates, is supporting higher asking and agreed sale prices. Some buyers are still making low-ball offers but are finding they are not taken seriously so are forced to increase. By this time, it may be too late.'