In my last market report two weeks ago, I was a little on the pessimistic side. I may have used the phrase market? What market? What a difference a fortnight makes. We have let 6 properties since my last newsletter without actually meeting the prospective tenants in person.
The Rental Market
We are utilising modern technology to conduct virtual viewings using Skype WhatsApp and Facetime to show prospective tenants a rental property, and it is working. Prospective tenants can see the property ask me to go back to look at parts of the property in more detail. Enquiries are holding up well in fact they are on the increase. The fact is that life is still going on, people have new jobs, starting in May and June so they still need to move. Other life events don’t stop because of Covid 19. So if your tenant has given notice we can still let your property
There are more what we call “tyre kickers” around. If you’ve been in lockdown for three weeks you’ve binge watched Tiger King played Call of Duty for 24 hours straight and are now looking around your flat wondering “Why do I live here?” then what better to allay the boredom than to trawl through Zoopla On The Market or Rightmove and contact agents about properties you have no interest in viewing. Our job is to weed out the genuine applicants from the bored ones, and we are getting rather good at it. I have shown 8 properties in the last 8 days and have let 6 of them. Even though I say so myself that is quite a decent conversion rate.
This is not such good news. Yesterday Knight Frank furloughed the majority of its staff and this follows similar decisions from Connells and Purple Bricks. The market for sales has fallen off the proverbial cliff, and it will take a long time to recover. Even if the lockdown is over by the end of May many prospective purchasers will have lost a lot of income may have used some of their deposit to cover their regular expenditure or have just been frightened off by the biggest event to hit our economy for 100 years. It will take time for confidence to return to the market especially amongst first time buyers who drive the market.
The counter argument is that once this unpleasantness is over there will be a lot of pent up demand prospective purchasers will be all over the internet booking viewings and house prices will surge. I am an eternal optimist but I am afraid I am finding this scenario a little hard to envisage. The market will return but I think we will have to wait a couple of years
Interest rates cannot get any lower. With the economy in freefall, I think we can expect interest rates to stay this low for many months or possibly years. Now is therefore the time to look at longer term fixed rate mortgages. If your buy to let mortgage is coming up for renewal talk to us. We have built up great relationships with several mortgage advisors who really what the market, and they are open for business. Why not give us a call and ask us to arrange a virtual meeting
In conclusion, there is a housing need and it is currently being filled by the rental sector, and in my opinion will continue to be for the foreseeable future. With interest rates and historically low levels, now is the time to look at fixing your rate and if you have a property to let, don’t panic.
Have you noted the significant increases in the local housing allowance, over £100 per month for most property typesPaul smith April 20th 2020 11:55:57