The housing market, like most industries, has gone through the rigmarole since COVID-19 in adapting how it operates to abide by the latest government regulations. This has not only affected estate agents, mortgage lenders but the conveyancing process too.
If you’re about the begin the journey of buying and/or selling a property take a look at our guide on what to expect as the UK eases out of lockdown.
How has conveyancing changed to reduce the risk of COVID-19 transmission?
While health and safety was never an immediate consideration previously now this has become more of a key factor in reaching major milestones.
Therefore, partly due to the risk of completions being delayed by self-isolation etc, there is now more of a propensity to exchange and complete all on the same day (simultaneous exchange and completion).
This means conveyancers can assess on the morning of completion that everyone is able and ready to move before making it legally binding. However, as lockdown is being eased confidence is returning and these “sims” are reducing slightly.
Those in a long chain would be the least keen to go down the simultaneous route (it’s an added stress as someone could still pull out of the sale and the whole chain would collapse as well as logistics getting removals in etc). But similarly, in a long chain, you will end up with more risk of someone needing to self-isolate.
Have mortgage offers affected the progression of conveyancing transactions
It’s been widely reported that there has been a greater risk of mortgage lenders withdrawing mortgage offers after they’ve become more ‘active’ in checking up on recent applications to ascertain if a client’s circumstances have changed (e.g. furlough).
While we have always been aware of mortgage lenders withdrawing their offer to clients, it was highly unusual and has become more prevalent because of the pandemic. In turn, this is another reason we have seen an increase in simultaneous exchanges and completions.
Are ‘local lockdowns’ something to be concerned about if you’re moving in or out of a lockdown area?
While the UK was in complete lockdown there was clear guidance from the government on what house buyers/sellers could and couldn’t do during the pandemic. However, as we have eased out of lockdown the regulations have become less clear since Leicester became the first area to imposed a ‘local lockdown’.
As a result of this, the Conveyancing Association has provided new guidance with regards to home moves under local lockdowns.
The CA has been working with several bodies including the Government, MHCLG, Home Buying and Selling Group and in conclusion, the CA is in agreement that house moves can proceed.
The guidance suggests that, unless otherwise stated or legislated by Government or Public Health Guidance, conveyancers can continue to process transactions and move people within ‘local lockdown’ areas, as long as they are ensuring all recommended protections are employed, and that home movers are aware of their responsibilities in terms of protecting others.
Stamp Duty Land Tax (SDLT)
More recently, the Chancellor announced that the threshold at which house buyers are charged SDLT has risen from £300,000 to £500,000. This means that the average stamp duty bill will fall by £4,500 according to Rishi Sunak with nearly nine out of 10 people buying a main home this year paying no stamp duty at all.
If you’re buying a property over £500,000 and are unsure about how much stamp duty you’ll be paying the Government has an online calculator to help you.
While some changes have still caused uncertainty within the housing market the good news is conveyancers are not incurring as many difficulties in obtaining documents from the other side’s solicitors as more firms have some staff in the office now. Also, estate agents are a lot more active in terms of sales progression which is good news for both buyers and sellers.
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