It is difficult to think of an area of life that the coronavirus pandemic has not affected. Certainly, every legal service we provide at watersrule Solicitors has been impacted to some extent. In particular, we have seen significant changes happening in the residential property market.
During lockdown, the housing market was mostly on pause. Surveyors were not permitted to visit properties to produce essential information for the Home Report, meaning the majority of sellers could not sell their homes. When the Scottish Government relaxed the restrictions at the end of June, and the market opened up again, the volume of properties coming to the market and the demand from buyers were both exceptionally high. This has led to strong competition and a pricing boom in many areas of the country.
If you are considering buying or selling a home, you may be concerned about whether it is a good time to do so. Here, our Residential Conveyancing Solicitors provide an overview of what you should know about buying and selling in the current market.
Please keep in mind that this situation is continually evolving and local or national restrictions could have an impact on your transaction. For up-to-date information and personalised advice, please do not hesitate to contact us.
Since restrictions on the property market were eased in June, house moves have been able to go ahead. However, there is a big difference in the way the marketing and conveyancing processes are being conducted, with as much as possible occurring virtually. You may find it useful to read the Scottish Government’s COVID-19: Guidance on Moving Home for more information on the changes in place.
Despite new restrictions announced by the Scottish Government on 22 September, which prohibit social visits to other households – among other changes, it has been confirmed that property transactions can still continue.
The Scottish Government has introduced some changes to attract buyers and boost the property market during these difficult times. The Land and Buildings Transaction Tax (LBTT) threshold has been raised from £145,000 to £250,000 until 31 March 2021, meaning you will now only pay tax on the portion of the property’s value over £250,000. If the home you wish to buy is under £250,000, you do not need to pay any LBTT.
Further, if you are ready to make your first step onto the property ladder, you could benefit from the additional £50 million investment that the Scottish Government has recently injected into the First Home Fund. The initiative launched in December 2019, aims to lend money to up to 8,000 first-time buyers. Due to high uptake in recent weeks, the scheme will close to new applications at 2 October 2020 and is expected to reopen In spring 2021.
Buyers should be aware that competition is high. With lockdown giving many people the time to consider their property needs, the market has experienced a surge in demand following the lifting of restrictions. Evidence of this is given by ESPC, which reported a 229% increase in viewing requests in July 2020 compared to the same period last year.
What this means is that the current conditions are most positive for sellers. Indeed, in many areas of Scotland, the majority of properties are being marketed as “offers over”, average asking prices are higher than usual and selling prices are continually equal to or over the Home Report valuation.
Whether it is the right time to buy will also depend on your particular circumstances. Do not hesitate to get in touch with our Residential Property Lawyers to discuss your plans for buying a new home. We will listen carefully to your needs and offer advice based on all the factors involved.
Sellers can be confident at the moment with high levels of demand and healthy selling prices. While this may mean the viewing and offer stages will progress swiftly, hold-ups can happen during the conveyancing process. There are various parties involved at this stage, for example mortgage lenders, and if they are experiencing delays and backlogs, like so many are at this time, the transaction may slow down. It is important to be aware of this if your sale is under time pressure.
Our Residential Conveyancing Solicitors will work hard to minimise delays where possible. Although our team are working remotely, we are making full use of digital means to maintain regular communication with you and the various others involved in your transaction.
On the whole, Scotland is currently experiencing a busy and resilient property market, and so it could be a good time for you to sell. If you would like to discuss selling your property, please contact our team for up-to-date information on the market and the process involved.
You can still apply for a mortgage, but many lenders have raised their minimum deposit amount to 15% (from the usual 10%, or 5% for first-time buyers). If this is unaffordable, it is worth shopping around as there are still some mortgage providers who are accepting the standard deposit rates.
It is also important to be aware that in the current red-hot property market, lenders are dealing with large volumes of mortgage applications, which have been causing delays. Those requiring the lower deposit amounts tend to be the busiest. At watersrule, our team can also put our clients in touch with mortgage brokers who will help them find the best deals.
We understand you might be feeling unsure about buying or selling a property in this highly uncertain climate. Our team are here to provide you with up-to-date information and expert legal advice based on your particular circumstances. We want to reassure you that we are committed to providing the best possible service, come what may. For help with your property transaction, contact our Residential Property Solicitors on 01259 753330 or using our online contact form.