There are approximately 373,000 property purchases currently on hold due to COVID-19, worth a combined estimated value of £82bn, according to Zoopla UK’s UK Cities House Price Index.
The majority of these sales were agreed between November 2019 and February 2020, and would have been set to complete between April and June.
Zoopla reported that there are still some sales being progressed earlier in the process, with deals being struck sold subject to contract, largely based on viewings and progression that took place ahead of the lockdown.
The research found that new sales agreed are currently running at a 10th of the levels recorded in early March, settling at levels similar to those expected in late December.
Some buyers evidently want to press ahead with agreeing sales, encouraged by government support for the economy and low mortgage rates.
The rate of fall-throughs peaked on 23 March, the day lockdown started, but has fallen back as the volume of new sales being agreed declines.
The outlook for sales progression will depend on how long lockdown restrictions remain in place, as well as the scale of economic impact, and how this affects would-be buyers’ ability to proceed.
Demand for housing fell by 70% between the start of March and the week ending 29 March, with the greatest decline recorded ahead of the lockdown.
The drop in demand bottomed out in early April and has since started to improve slowly.
Despite a steady increase in buyers looking for homes, demand remains 60% below the levels recorded at the start of March.
Browsing of property listing fell in line with demand, but to a lesser degree, as households can still browse online.
Browsing levels have bounced back more strongly over the last three weeks, but remain 35% lower than at the start of March.
The drop in demand for housing as a result of COVID-19 reached 80% in Cardiff, while Newcastle registered a lower drop of 40%, where market conditions were already weaker.
Over the last two weeks, demand in cities across Northern England has rebounded more strongly, most notably in Manchester, Liverpool and Leeds, cities where 2020 started strongly and where housing affordability remains attractive.
Higher value cities, such as Cambridge, Edinburgh and Southampton have not yet recorded any material improvement in demand over the last few weeks.
Zoopla forecasted that the volume of completed sales will be 50% lower in 2020 than 2019.
However, the total number of properties for sale is just 4% lower than the start of March, indicating no mass withdrawal.
Zoopla’s Cities Index registered the lowest monthly growth in house prices for over a year, at +0.1%, a third of the rate recorded in January and February.
The five best performing cities recorded year-on-year growth of over 3%, with Nottingham leading with a rate of +4.1%.
Richard Donnell, director of research and insight at Zoopla, said: “There is a two-speed housing market at present.
“Parts of the market are at a virtual standstill as a result of the physical restrictions that have stopped new supply coming to the market and the viewing of homes for sale.
“However, the online browsing of homes for sale and buyers expressing interest in property have been rising off a low base over the last two [or] three weeks.
“Demand for housing is still 60% lower than at the start of March, but we expect interest in housing to continue to improve slowly.
“Northern cities have seen the strongest improvement in underlying demand although levels remain half those at the start of the crisis.
“Sales continue to be agreed in low volumes by purchasers who viewed homes ahead of the lockdown, but there is a large pipeline of agreed sales held up by the temporary suspension of the sales market worth £82bn.
“In addition, these sales will generate associated spend resulting from housing transactions that can stimulate economic activity.
“Without doubt, once the coronavirus restrictions are relaxed, we should expect the release of demand that has been building since Brexit and political uncertainty destabilised market sentiment.
“That said, the case for a stamp duty holiday to support a resumption of market activity is clear and a high proportion of savings are likely to be spent, further stimulating economic activity.
“We expect completed housing sales in 2019 to be half of those in 2020, having lost close to two full months of market activity by mid-May, and taking into account time for agents to rebuild sales pipelines.
“Many households have spent more time at home in the last few weeks and some may feel the urge to move and find more space or consider the potential for remote working.
“This could boost activity in the second half of 2020, but this all depends upon how much the economy is impacted over the rest of the year and the impact on levels of unemployment.
“It is too early to register any pricing impact given new sales volumes are 90% down on the start of March.
“Demand is rising but there is a long way to go until we see a return to typical levels of market activity.”