The property market cannot afford a long bout of coronavirus uncertainty
John Phillips (pictured) is national operations director at Just Mortgages
Since the General Election, there’s been a distinct sense in the air that the confidence has come back to the mortgage market.
The figures that came out from the Bank of England at the start of March seemed to bear that out, with mortgage approvals in January hitting the highest rate since February 2016 – a few months before you-know-what ushered in a long period of uncertainty.
Cue sighs of relief all round. Buyers are coming back to market, listings are up, we can all get back on track and move on, right?
It’s certainly the case that we’ve seen the market pick up in the first quarter of 2020.
It was never a certainty that this would last but there is still plenty of reason to be hopeful that we have shaken off the deadweight of Brexit and political deadlock.
Not so fast, though, as there’s now a new fly in the ointment in the shape of the Coronavirus, or COVID-19 to give it its proper name.
The coronavirus has the potential to do real damage, and not just to people’s health – although that of course has to be everyone’s first concern, from individuals to employers to policy-makers.
Any early hopes of nipping the virus in the bud are fading fast and we’re now in the business of delaying and slowing down its spread.
The efforts to prevent the disease getting worse are likely to have a serious impact on everyday life, with talk of people ‘self-isolating’ to avoid spreading the disease to co-workers and fellow commuters.
Not everyone can work from home, so many businesses will be looking at a loss of revenue and this won’t necessarily be something that can be ‘made up’ once the outbreak is under control.
There will inevitably be a knock-on effect on the property market, too. If anybody’s in two minds about buying or selling their home, it will give them plenty of reason to go back into their shell and wait it out until things have passed.
Hopefully that won’t be too long, but who knows?
In the meantime, if we’re all put on a war footing and avoiding all human contact, that’s not going to do wonders for the house-buying process.
Quite a lot can be done remotely, of course, but there’s no substitute for face-to-face contact for some things. Things could get very difficult indeed unless this is resolved quickly.
Let’s hope the worst fears currently being voiced by some are not borne out and that we can rapidly get the virus back in its box.
Another prolonged bout of uncertainty is the last thing the market needs.