Official or Regulated Local Authority Search – which is right for your move?

A local authority search is the most common search required when purchasing a property. It provides a cross-section of all the information held by the local council about your property, including:

  • Local Land Charges Registrations (LLC1)
  • Any planning permission granted, refused or pending
  • Building control regulations
  • Public use of the property’s land
  • Highways information
  • Road schemes near the property
  • Rail schemes near the property
  • Radon gas 
  • Whether the property is part of a conservation area
  • Contaminated land

If your purchase is funded by a mortgage then, in most cases, you’ll need to get a local authority search as a condition of lending. In the same way that you wouldn’t be thrilled to discover your new home has subsidence problems, lenders need to know about anything that could impact the future value of the property.

There’s currently no obligation for cash buyers to get a local authority search done. However, it’s strongly recommended you order a search regardless of how you’re funding the purchase. After all, no one wants to move into a new home only to discover there’s a public right of way through the garden or the property is built on contaminated land. 

What’s the Difference between Regulated and Official Searches?

An official regulated search or OLAS is compiled by the local land charges department at the council. A regulated search uses the same data but is compiled by a search agent or company (like PIC). The information contained in a local authority search is public record so, in theory, anyone could compile one but you need to know what you’re looking for and where to look.

The Case for Official Local Authority Searches 

It was once the case that OLAS were the preferred version of local authority search for most mortgage lenders. And, although most now accept or even prefer a regulated search, there are still some lenders who insist upon buyers purchasing an official search. 

The reasons for this go back a long way. Up until the early twenty-first century, there was a perception that regulated searches were unreliable or somehow ‘less valid’ than a search carried out by the council. The price also has something to do with this. OLAS are typically more expensive than regulated searches, so it was easy for many to assume that higher cost meant higher quality. 

Alongside this, some felt OLAS offered greater protection should anything go wrong. The local authority is held liable for any losses incurred as a result of a search being completed incorrectly.  And this led to the assumption that it would be far simpler to make a claim in the event of an error. 

Thankfully, this mindset has changed and, as we’ll see, there are plenty of reasons why purchasing a regulated search may be the best fit for you. 

The Case for Regulated 

The rise of regulated searches can be traced back to one thing: local authority turnaround times. Regulated or (as they were formally known) personal searches first appeared on the scene back in the 1980s. At the time, some local authorities were taking weeks or even months to return a search, causing hundreds of aborted transactions. 

Regulated searches have always been faster and more cost-effective, due to the smaller workloads managed by search agents and the fact they can focus on just compiling searches. However, in the past, they weren’t always as reliable as they could have been.

That’s no longer the case. The regulated search industry has its own trade association and regulatory body, COPSO. As a result, any report carrying the COPSO watermark comes with assurances that it’s of equal, if not higher, quality than any official search. 

But it’s not just the quality of regulated searches that has improved. Most search companies now offer PI insurance as a standard bolt-on for every regulated search. For example, at PIC, all our regulated local authority search reports carry £5 million of insurance coverage. There’s no need for a protracted court case with the local authority or a battle to prove liability. Instead, you know you and your property are covered.

As we mentioned earlier, regulated searches also tend to be quicker than OLAS. Search agents aren’t trying to do several jobs at once and we can offer flexibility and prioritise urgent jobs in a way that councils can’t. What’s more, with a smaller workload and, in many cases, better resources a search agent can take the time to answer any questions you have and keep you updated every step of the way. 


And then, there’s the cost. Depending on where you are in the country, your local authority could charge anywhere between 2 and 3 times as much as a search company. It’s worth pointing out that this is still exactly the same search, it just costs more money. Search agents, on the other hand, will usually charge a flat fee no matter where you are in the country, so there’s no financial penalty for living in an expensive local authority. 

To draw some sort of conclusion, the search you choose will likely come down to your lender, but there are plenty of reasons to go regulated. If you do, always look to work with a reputable agent and keep an eye out for companies that are COPSO affiliated and offer insurance with each search. 

If you’d like to know more about conveyancing searches, please get in touch, we’d love to hear from you. 


What Will Happen to All the UK’s Empty Buildings?

Regardless of your political loyalties, it’s hard to deny that the UK has a housing shortage. A 2019 report from the National Housing Federation estimates that Britain needs 340,000 new homes every year, including 145,000 social homes, to meet the housing demand.

However, underpinning the UK’s housing crisis is a seldom-covered secret. While new houses are needed, Britain currently contains hundreds of thousands of unused residential and commercial properties – a trend that’s only been accelerated by the COVID-19 pandemic.

How has this happened? And what will happen to Britain’s ghostly cityscapes of empty high streets and residential developments?

Residential property 

The huge number of empty residential properties in the UK is surprising. After all, we’re often told we’re in the midst of a housing crisis and this conjures up mental images of a residential sector bulging at the seams. 

However, as of September 2020, 268,385 properties in England have been left empty for more than six months according to government research. If we dig a little deeper into this figure, we turn up some truly mind-boggling statistics. For example, in the London Borough of Camden, 

9,595 homes remain out of regular use, accounting for one in 12 properties in the borough. What’s more, the latest figures represent a 20% increase on 2019 with over 40,000 more homes being left empty.

So why is this happening?

Well, while it might seem like madness to many of us, there are several reasons why a residential property may not be rented or sold. 

Let’s start with the simplest. One of the most common reasons a property is empty is because the owner can’t raise the capital to do the property up to let it out or sell. Many of Britain’s empty homes are in varying states of disrepair and, for the owner, renovating may outweigh the returns they’re likely to receive in rent or by selling the property. 

Take, for example, properties in former industrial heartlands and coastal towns. Towns and cities like Portsmouth, Middlesborough and Hartlepool consistently rank among the highest for empty homes. The equation is simple; renovation costs are high, while house prices and rents are low in comparison with other parts of the country. This offers little incentive for landlords to do the work needed to make the properties habitable.

The same is true of council-provided social housing. The public sector has spent much of the last 15 years battling one form of austerity or another. And slashed budgets have made it difficult for local authorities to allocate the funds needed to renovate dilapidated post-war social housing. This means that the properties either stand empty, decaying further each year, or the land is sold off to private developers who then use it to build new complexes with minimal social housing. 

These problems in social housing and rental properties are coupled with issues at the 

top end of the market. Take a look at the skyline in any major city and you’ll see plenty of gleaming new-build apartments. From luxury flats in converted offices to bijou maisonettes in former industrial buildings, redevelopment has become the watchword in our biggest cities. The only drawback is that many of them are empty. 

There are a few reasons for this. Many of these ‘investment’ properties are simply too expensive for locals to buy or rent. And those who can afford to buy will often pay a premium for an unused apartment, so it makes sense to leave the property empty until the ‘right’ buyer can be found. Even if an investor is interested in letting it out, the costs involved such as wear and tear and administration can outweigh any money made in rent. 

Another reason for empty properties is the nature of many of the investors behind the developments. For some time now, property in Britain’s major cities (London in particular) has been seen as a risk-free investment for foreign capital. For these investors who live outside the UK, simply owning a chunk of London real estate is the ultimate aim. The social utility of the property doesn’t come into it. 

Commercial property 

While it’s happened much more quickly than on the residential side, the commercial sector is going through its own ‘empty buildings’ crisis. 

The High Street is in terminal decline, leading to a glut of empty retail space in our towns and cities. For instance, the collapse of retail giants Debenhams and Arcadia (Topman, Topshop and Dorothy Perkins) alone has led to 15m square feet of space appearing in the commercial rental market. And with many brands moving operations online, it’s not clear where tenants or buyers will come from. 

At the same time, COVID-19’s impact is being felt well beyond the high street. Many businesses were forced to adopt remote working last March and, for some, it’s sparked the realisation that they can do away with some or all of their physical office space without impacting productivity. Of course, we’re unlikely to see businesses stop using commercial spaces completely – meeting spaces will still be needed – but things have changed. 

This leaves commercial landlords with a big problem. What to do with the sudden surplus of office space, when it’s likely demand will never return to pre-pandemic levels?

What should be done? 

Perhaps not surprisingly, the answer to solving the UK’s empty property crisis is as complex as the problem itself. 

For residential properties, something needs to be done to incentivise owners and investors to bring empty units onto the market. Solutions could include grants for renovation, tax cuts, or, at the other end of the scale, state-led requisition and compensation schemes to bring the stock into public ownership. However, these solutions depend on proactive government intervention on both a national and local level – something that has long been lacking. 

Alongside this, legislative action needs to be taken to ensure that properties in high-demand areas are purchased as homes and not, as Boris Johnson once termed them ‘blocks of bullion in the sky’. Such a scheme could include buy-to-let properties. What’s important is not the ownership of the property per se (although, making housing more affordable should be part of the goal) but that someone actually lives in it. 

Similar action also needs to be taken in the commercial sector. The high street as we know it is gone and so too is the traditional office. So it’s time to consider alternatives. Former retail property could be transformed into community spaces or incubators for small businesses. Office space could be given over to charities, food production or residential units. 

A great example of this in practice is the ‘Preston model’. The experiment in ‘community wealth building’ saw Preston council work alongside local businesses to transform a dilapidated city centre into a place voted ‘the best place to live in the North West’ in five short years. 

It might sound idealistic, but initiatives like the Preston model are exactly what we need if we’re to end the UK’s crisis of empty homes and high streets. Change won’t be easy or fast. But, the alternative is to ignore the problem and hope forlornly that the supply of new homes can one day catch up with demand. 

We already have enough empty properties to home thousands of people, let’s use them. 


What Will Happen to the Housing Market When the Stamp Duty Holiday Ends?

One of the few silver linings of the last year has been the resilience of the housing market. Despite predictions of a major slow down or even a crash, the sector has rebounded with a speed that’s surprised us all. 

What consultancy Oxford Economics has called ‘a very peculiar housing boom’ has so far relied on a perfect storm of favourable factors. These include typical home buyers (often middle-aged and financially secure) being less likely to lose their jobs, foreign capital continuing to flow, pent-up demand following the first lockdown, and the stamp duty holiday unveiled by Chancellor Rishi Sunak back in July 2020

This has allowed the UK housing market to remained relatively insulated from the travails of the wider economy. And even post some frankly astonishing figures, such as the Nationwide building society’s October report which revealed an annual price growth rate of 5.8% – the highest in six years. 

However, a central plank of the market’s recovery is set to be removed in just over a month. March will see the end of the stamp duty holiday and, as yet, there are no plans to continue it. So, what does this mean for the market? Can we expect it to remain buoyant? Or are we set for another fall? 

The Case for a Crash 

Unfortunately, we have to start by looking at the worst-case scenario. The sudden removal of a policy that has provided a fuel injection to a flagging market could spark a collapse in house prices.

The problem is that, although the end of stamp duty alone probably isn’t enough to cause a full-scale crash, when combined with other factors it might. The UK has rising unemployment, economic uncertainty, and a falling population in London. And all of these things are also likely to reduce the number of potential homebuyers and put the squeeze on demand.

In particular, the 700,000 people to have left London since the outbreak of the pandemic is a real worry. Many of these people are young, EU nationals who – due to Brexit – aren’t necessarily going to return once COVID-19 is brought under control. These people along with their British-born counterparts (who due to the normalisation of remote working also have less incentive to return) are crucial to London’s rental market. 

Without them, we could see a glut of former buy-to-let properties being put on the market as the renting loses its allure for landlords. This, in turn, would drive prices down across the board.

When you combine this with unemployment and the end of the stamp duty holiday, it suddenly looks like another perfect storm gathering – only this one could crash the market instead of saving it. 

Reasons to be cheerful 


Now, for some reasons to remain upbeat. First, the current Conservative administration has a penchant for last-minute decisions on crucial fiscal policy, especially when there’s public pressure involved. For evidence just look at the U-turns on extending the furlough scheme or free school meals. Even if at the moment an extension of stamp duty exemptions looks unlikely, that might not be the case come March.

Alongside this, although we’re almost going to see some drop-off, many, many things have to go wrong for a full-scale crash. For the market to really be in trouble, we’d need to see home buyers facing severe difficulties paying their mortgages. This typically happens for two reasons: an increase in interest rates or large-scale job losses amongst the middle-aged and middle class. 

With interest rates at record lows, the former is very unlikely. As for unemployment, it is true the UK is facing a crisis. However, thus far, job losses have mostly been confined to hospitality and service sectors, both areas of the economy that typically employ young and disadvantaged people who aren’t likely to purchase a house any time soon. Whatever this says about our society (and it is damning), it at least provides some hope that homebuyers, who typically have excess capital such as savings, might emerge relatively unscathed. 

Finally, while it might not look like pretty right now, would a slowdown leading to a drop in prices be the worst thing for the market long-term? It could offer a way into the lower end of the market for first time buyers and, in time, push demand back upwards a little more fairly. Perhaps a slowdown in 2021, painful though it might be, is the correction the market needs to return to better health in 2022.

For now, we wait to see what the Ides of March bring. 


How Will the New Tier System Affect Conveyancing Turnaround Times?

Depending on where you live in the UK, the last few days have either been a long-awaited chance to see loved ones, eat in a restaurant, and engage in some retail therapy or the beginning of another long period inside. 

But while we’re all aware of the social and personal costs of the government’s new COVID-19 tier system, there’s been less written on its impact on individual sectors of the economy (outside of retail and hospitality). And you’ll find even less information on what it means for conveyancers.

We’ve discussed COVID-19’s likely effect on house prices and market activity in previous blogs. This is largely because it’s far easier to find data at the macro level of the market. A simple Google will tell you most of what you need to know. 

However, conveyancing has always been a business dependent on speed So, this week, we’re looking at the possible effect of the new tier system on turnaround times. And, because this can either mean the time local authorities and search providers take or transaction times themselves, we’ll take each in turn. 

Local Authority Turnaround Times

The speed local authorities can turn around official searches has always been highly variable. For example, if you’re moving within Boston Borough Council’s catchment, your local search can take up to 34 working days, whereas if you’re moving to York it’ll take just one day. 

Even within a single city, lead times can fluctuate wildly. If you’re moving to Hackney, it’ll take on average 141 working days to get a completed search. But if you’re heading west to Hammersmith it’ll take less than a tenth of the time.

While it might be frustrating for homebuyers and anyone involved in the conveyancing process, it’s sadly a natural part of working alongside public sector bodies. Local authorities have different levels of funding, workloads and staff numbers. Hackney Council could be dramatically slower than Hammersmith for any number of reasons. But it’s due in part to it being one of the largest London boroughs and the site of rapid redevelopment – stretching the staff at the local land charges. 

COVID-19 simply exacerbates the inequality between local authorities, many of whom will have had to furlough staff or adopt remote working, not ideal working conditions for any organisation. And things are even harder for those councils in tier 3 areas who are subject to tighter restrictions. 

Local authorities such as Liverpool, Leicester and West Lancashire that currently complete searches reasonable quickly are likely to see a slowdown while under restrictions. Again, this could be for several reasons. For instance: staff shortages due to furlough and sickness or attempting to fulfil their search obligations remotely with all the technical problems that entails.  

Personal or regulated search businesses may be able to pick up some of the slack. We’ve long been lauded for our ability to pull rabbits from hats and turn searches around faster than local authorities. What’s more, at least some of the information is held digitally by the Land Registry, removing some of the need to go to the local authority. 

Nevertheless, without proper access to local authorities’ CON29 data, it’s tricky. So, expect delays in some areas to worsen until early 2021. 

Search Providers


What about all the other searches that go into the conveyancing process? Water? Coal? Subsidence? 

Well, although we won’t name names, much like local authorities some of the businesses who produce these searches are struggling. Some are in areas with stricter lockdown measures preventing staff attending the office. Others have staff shortages due to furlough schemes or, in the worst cases, redundancies. 

Naturally, these conditions lead to slower services and delays. We’ve yet to encounter delays on the scale seen at local authorities, but it’s clear some businesses are having a tough time of it. 

Transaction Times

Finally, let’s take a look at overall transaction times. 

Interestingly, transaction times have been providing conveyancers with some all-too-rare good news during the pandemic. Lead times have slowed, Investec, HSBC and Santander have all reported delays. And, as a spokesperson for the Building Societies Association (BSA) told Today’s Conveyancer

“Clearly resource management amongst all parts of the chain has been key – particularly as everyone has been impacted by the number of staff who need either to self-isolate or who are unwell because of the virus. Buyers and sellers contracting the virus or needing to self-isolate have also been a factor.”

However, delays have been small, usually in the region of 1-4 days on average and the outlook is getting brighter by the day. Many of the same banks and building societies we mentioned earlier are now reporting improvements, with some even stating lead times are within the normal range. 

There are understandable concerns about the impact of the new tier system on lead times. Conveyancing has always been a bit of a postcode lottery, with the time it takes to complete heavily influenced by where you’re moving to. And the pandemic has indeed worsened some of the industry’s existing problems. 

But despite this, the industry has managed a once-in-a-generation disruption far better than many would have predicted. So, with a vaccine just around the corner, perhaps we should view the tier system as one last hurdle to clear before normality can resume. Of course, delays are inevitable and it may well take some local authorities until summer 2021 to clear their backlog, but the future suddenly looks much more hopeful.


Is Remote Working the Future of Conveyancing?

Are you feeling a sense of Déjà vu yet? 

As England returns to a nationwide lockdown, many of us are returning to our hastily prepared desks in the spare room and heading back in time to March 2020. But, rather than a temporary inconvenience, is our current situation a foretaste of what’s to come? Could remote working be the future of conveyancing?

The Case for Remote Working 

Let’s start by asking another question. How much of the conveyancing process really needs to be conducted in an office? 

Since midway through the last decade, the industry has been slowly – and at times painfully – been moving towards a digital future. On the lawyers’ side, the first electronic mortgage was completed back in 2018. And, while digital mortgages aren’t due to become compulsory anytime soon, it’s not hard to imagine them being used more widely in the future.

What’s more, despite concerns about compliance, electronic signatures are well on the way to being commonly used. Transfers of land and charges must be made by deed. In other words, they need to be signed, witnessed and attested. So, naturally, many conveyancers worry about how they can be compliant with the legal requirements for execution remotely. 

However, this hurdle can be cleared using the government’s ‘Verify’ service – an online application that checks identity. It’s the service you used if you’ve ever applied for a driving licence or passport online. It works by an individual signing up to an account with a government identity provider before having their identity verified against credit agency or mobile phone provider data, a process that takes 5-10 minutes. 

Services like Verify remove the need for conveyancers to meet clients and witnesses in person, without the compliance risk this would usually entail. 

But it’s not just conveyancers who are benefitting from new technology. The Land Registry began its process of digitising and centralising the LLC1 back in 2018. And, although the process has been fraught with difficulty, eventually, search agents will be able to access instantaneously LLC data online – removing at least some of the need to visit local authorities in person. 

What Needs to Happen to Get Us There? 

So, if much of the infrastructure for remote conveyancing is already there, why is the industry much the same in 2020 as it was in 2010? Well, unfortunately, there are still a few vital missing pieces.

Digitise the CON29 

This one’s pretty glaring. From a search agent’s perspective getting LLC1 data digitally from the Land Registry while still having to source CON29 data from a local authority, actually makes the process more difficult. Admittedly, some councils offer the CON29 digitally, but many more don’t. For search agents to work from home permanently, all data needs to be accessible digitally and preferably from one central source. 

Improve Trust 


For all its strengths, the legal sector has never been one for rapid innovation or embracing change quickly. So while digitised processes like electronic mortgages and signatures are now a reality, until there is widespread trust in them they’ll never be fully adopted. More needs to be done to demonstrate to the industry as a whole that tools like Verify are not only safe and reliable but also convenient.

Alongside this, there’s an urgent need for government legislation to clarify the legality of many of these tools. Doing so would be a major step towards the whole industry embracing remote working.

More Technology

Although progress has been made, the tools required for real digital conveyancing are still in their infancy. If one of the greatest concerns about electronic conveyancing is security, then it stands to reason that’s it’s this area which will need to see the most rapid developments. We’ll need tools like biometric or retinal scanning and a whole host of anti-fraud measures if electronic conveyancing is to take off. 

Get Buyers Onside  

In much the same way as the legal industry, buyers will need to fully trust the process before they use it. After all, no one wants to risk the biggest investment of their life on processes and technology that’s still in its beta phase.

 It’s a bit of a chicken and egg scenario. Conveyancers can’t iron out the wrinkles in digital processes without real transactions to test them on, but buyers won’t use the technology until they’re confident it’s safe. As with conveyancers, the key to building confidence among buyers is a strong, clear signal from the government, most likely in the form of legislation or a campaign.

Meeting these requirements could take a couple of years or a decade. Fully digital conveyancing is probably inevitable, but it’s a question of appetite for change – does the industry have it? And will the government stand behind new technology to build trust? If not, could COVID-19 and the sudden need to do things differently provide the catalyst? 

We’re about to find out. 


Will the Housing Market’s V-shaped Recovery Last?

We’ve talked a lot recently about the UK housing market’s seemingly miraculous immunity to COVID-19. But in case you’re unfamiliar with what’s going on, the story is as follows. Unlike the wider economy, which is currently in the throes of a potential double-dip recession, the housing market is flourishing. 

Data from the Royal Institute of Chartered Surveyors (RICS) shows buyer enquiries recovering strongly in July which, due to transaction times, is positively influencing sale prices in September and early October. Meanwhile, Google search data reveals that as recently as early September, buyer interest remains well above pre-pandemic levels. 

This has led many commentators, including the Bank of England, to label the phenomenon a ‘V-shaped’ recovery. But can the recovery last? Or are will the housing market eventually succumb in the same way the labour market and wider economy has? Let’s look at the case for continuing recovery and the case against.   

Yes 

Perhaps the best indicator that the recovery could be here to stay is that current activity isn’t being driven by backlogs. It was easy to put the initial bounce in activity we saw in the summer down to the pile-up of incomplete transactions from earlier in the year. However, even the most sluggish of transactions in the backlog would have completed by early August. After all, the housing market reopened in May. 

Yet, the housing market continues to surprise. The building society, Nationwide, reports that UK house prices hit an all-time high in August. What’s more, Zoopla announced that the number of sales agreed in August were 76% above their five-year average. This, coupled with the Google search data we mentioned earlier, appears to point to a positive outlook for the rest of the year. 

There could be several things driving these impressive numbers. It could be lockdown-induced itchy feet from buyers in smaller properties. Or maybe it’s down to middle-class urbanites taking the chance to move out of major cities as the switch to remote working continues (as we covered recently ). Perhaps it’s simply a case of those with capital seeking to invest in property – always seen as a safe option in a downturn. 

Or maybe, just maybe, we’re headed for a fall. 

No

Sadly, it’s time for some gloom. We know you’ve probably had enough to last a lifetime but, for the sake of balance, we need to cover why the V-shaped recovery could turn out to be a W.

In a w-shaped scenario, the peaks we’ve seen throughout the summer begin to gradually decline as we hit mid-to-late autumn. The theory goes like this. As pent-up demand for housing begins to subside, the housing market will begin to rely on ‘underlying’ demand. Or, to put it another way, the demand that isn’t being driven by delayed existing transactions from earlier in the year. 

Most commentators think this underlying demand remains weak. Add this to conditions that include a weakened economy, tight credit conditions, mortgage lenders nervous about the future, and the end of stamp duty, and you have all the conditions for price stagnation in 2021. And this is before we even consider the dreaded ‘B-word’ and its potential effects on the housing market. 

Some housing market experts have been predicting this for a while. JLL, the American commercial real estate services company, has long suggested that the UK could see an 8% drop in house prices by the end of 2020. Business management consultants, Capital Economics, go even further – predicting a year of stagnation in 2021. 

Nevertheless, there is an upside to all this. The more eagle-eyed among you may have realised that for market activity to form a W, we need an upward trajectory once the decline and/or stagnation ends. 

If we zoom out for a moment and look at the bigger picture, one of the longer-term effects of the COVID-19 has been to transform the way we all think of the workplace. It’s also very likely that these changes will be permanent. In short, many of us are going to be working from home (at least some of the time) from now on. 

As we’ve already seen on a smaller scale with wantaway Londoners, this has the potential to trigger a structural increase in housing demand. Many people will be looking at the four walls they’ve spent much of the last year within and decide it’s time for a change – whether that’s buying a first home, moving out of the city or just moving somewhere a little bigger.

Of course, for this to really take off, confidence in the economy, labour market and housing will have to return. This will take time, and could mean a tough year for conveyancers, but the green shoots of a potential recovery are already there.

So, conveyancers take heart. A W might not be quite as promising as V, and things might have to get worse before they get better, but both lead to a recovery in the end. 


Could London See an Exodus of Homebuyers?

A recent poll conducted by the London Assembly Housing Committee reveals that one in seven Londoners (14%) want to leave due to the COVID-19 crisis. Could we see an exodus of buyers to the home counties and beyond? And, if so, what does this mean for house prices and the market?

Let’s picture a scenario. 

It’s a normal Monday afternoon, sometime in 2026. You’re heading home from the office after a long day. A COVID-19 vaccine was found a couple of years back so, although you’ve never returned to the office fulltime, you head in once or twice a week.

On your way into the station, you pick up a copy of The Evening Standard. The front page screams ‘London property prices fall for the fourth year in a row’. You’re headed back to your newly purchased home in one of London’s trendier boroughs, let’s say Hackney or Southwark.

Just a few years ago, purchasing a house in this part of town was an improbable dream for all but the wealthy and those fortunate enough to have inherited money. But that’s all changed. 

Your area is now full of new homeowners. Young professionals. Families. Lifelong Londoners. The bad old days of ordinary Londoners being forced into decades of precarious renting have passed. The city is one again a place where people can settle and put down roots.

As a result, local communities are thriving. Your neighbours recognise you on sight. People smile at you in the street. 

Commentators put London’s transformation down to two things. First, the exodus of middle-class professionals to Kent, Hampshire, Essex and beyond in the wake of COVID-19. Second, the falling demand for housing this caused and the corresponding drop in prices, making housing more affordable for those that stayed. 

Sounds fanciful, right? However, if the last few years have taught us anything, it’s that what seemed impossible a decade ago is today’s reality. So, could it happen?

The Case for Falling Prices 

The case for falling house prices is a simple one. The COVID-19 crisis has caused the UK economy to contract 20.4% in the second quarter of 2020. This followed a 2.2% contraction in the first quarter. And, where the economy leads, the housing market isn’t far behind. 

JLL, the corporate real estate services company, has predicted an 8% fall in property prices for 2020. Meanwhile, according to the Royal Institute of Chartered Surveyors (RICS) London house prices continued trending downwards, even during the easing of lockdown measures between July and September. This makes London the only region across the UK to still experience price falls. 

At the same time, there’s been a near-universal shift to remote working in white-collar jobs. This has led to many middle-class professionals (who make up a large proportion of London’s homebuyers) considering whether they need to live in London at all. After all, why live in London when you could do your job anywhere and get considerably more for your money elsewhere?

The number of job seekers wanting to leave the capital more than doubled in June,  according to the Escape the City careers advisory service. This has been mirrored by a doubling in the number of buyers registering outside of the capital throughout the summer. 

The theory goes that economic contraction and an exodus of the middle classes work in tandem to create a fall in demand for houses, particularly at the lower end of the market. In turn, this leads to a drop in house prices, making housing more affordable for first-time buyers. Eventually, you end up with a scenario like the one we explored earlier.

It’s a crude theory, but certainly not impossible. What about the case against? 

The Case Against

Although the idea of London becoming an affordable city to live in might be a nice one, it’s also very possible this lull in growth is temporary. 

Many analysts are predicting a strong recovery in the London housing market as early as 2021. Estate agents, Knight Frank, forecasts that London house prices will jump 6% next year. Meanwhile, their competitor, Chestertons, predicts growth for inner London between 3% and 4%. There are a few reasons why this could provide a more realistic picture. Let’s take each in turn. 

Firstly, the sheen might have worn off living in London during COVID-19, but the city remains one of the most desirable in the world. Were a vaccine to be found for COVID-19, London would quickly return to its role as the cultural and financial epicentre of the UK. With London back in business, pre-COVID demand and prices would quickly follow.

Second, we may not yet have seen the full effect of either the Stamp Duy Holiday (which doesn’t expire until March 2021) or conveyancers clearing their backlogs in the capital. 

Lastly, the role of foreign capital in inflating London prices can’t be ignored. Middle-class homebuyers are only part of the story, just as important are overseas investors who are largely responsible for spiralling prices over the last decade. 

Brexit’s fast-approaching conclusion will play a part in this. Should the UK crash out with no deal, investing in London property could become very appealing for buyers from nations with stronger currencies, leading to a mini-boom and higher prices for domestic homebuyers. 

Of course, both the possibilities we’ve discussed rest on what happens in the rest of 2020. Are we about to enter a second nationwide lockdown? Can a vaccine be found? Will the double-dip recession many are predicting come to pass? And what will the outcome of Brexit be? 

Without an answer to these questions predicting the future of London’s housing market is tricky. However, one thing’s for certain: whatever happens in the next six months will shape the city’s future for decades to come. 


How Well-insulated is The UK Housing Market Against a Second Wave of COVID-19?

The housing market has surprised us all in the last few months. Even the most bullish commentators couldn’t have predicted how resilient UK housing has proved. At the time of writing, the market is performing at close to 75% of 2019 norms.

Not bad, especially when you consider the once-in-a-generation disruptions the last few months have served up.

Yet, for all the positivity it’s hard not to worry that we haven’t seen the last of COVID-19. We may try to push it to the back of our minds. We may do our best to live for today. The frenetic activity in conveyancing departments across the nation certainly speaks to that.

However, most epidemiologists concede that a second wave is entirely possible, or even likely. If the worst should happen, how well-insulated is the housing market against a second period of disruption?

The Worst-case Scenario

Let’s start with the worst possible outcome. It might be tempting to assume that the housing market will simply stall for a while, then resume normal activity once the peak of the second wave has passed. After all, that’s exactly what happened back in June.

But there’s a key difference between the late-August and early-June. The state of the UK economy.

Of course, commentators have been concerned about the UK economy for much of the last decade. What’s different this time around is that a double-dip recession is no longer a spectre haunting economists’ dreams. It’s here.

According to the Office for Budget Responsibility (OBR), the UK could be facing the worst recession since records began. To put that in context, we could see 12% unemployment and a 35% contraction in GDP by the end of 2020.

You don’t have to be an economist to conclude this is bad for the housing market. Very bad. Mass unemployment means fewer people able to buy houses. And, even those that can afford it may well opt to sit out the storm and delay their purchase.

Nor is a recession likely to have a positive impact on house prices. Without a high-demand for property (outside the rental sector, at least), there’s little to drive values up. Admittedly, they’re unlikely to fall dramatically either as new build projects stall, but that’s no real solace to developers, conveyancers and estate agents.

In this context, a second wave could be disastrous. The combination of a flatlining economy and a return to lockdown could send the UK housing market into a deep freeze for months or even years.

A More Hopeful Picture

Despite all that doom and gloom, there are a few reasons why the housing market might yet prove resilient.

The first is the likely nature of any second wave. Although many of us are still susceptible to the virus and a vaccine is still some way off, that doesn’t mean it has to be as bad as the first time around. According to many scientists, provided the government eases its way out of the current lockdown measures (you be the judge of whether that’s happening), a nationwide shutdown doesn’t have to be inevitable.

Instead, we could well see a series of local lockdowns through the winter. As for how that would look, you need only look at Leicester, parts of the North West, and Aberdeen. This means that while local lockdowns would be terrible for conveyancers in the towns and cities affected, the impact on the market as a whole would probably be negligible.

The second factor worth considering is history. The UK housing market has proved itself remarkably durable in the recent past. Most notably in the months following the last wave, but also in the wake of the 2008 financial crisis. Its entirely possible that we could see a short period of stasis, followed by a return to something like normality very quickly.

Finally, there’s the wider question of how tied the UK housing market is to consumer spending anymore. Of course, it makes perfect sense that low-spending power among UK consumers equals poor demand and falling house prices. But, although this is partly true, it ignores the role of overseas capital in the market.

One of the key reasons house prices and activity remained relatively stable during the austerity decade (2008-2018) was foreign investment. Whether the same is true in the years ahead will largely depend on the outcome of Brexit and how hard the recession bites globally. However, it at least provides another cause for optimism for UK conveyancers.

Uncertainty Reigns

The truth is the next few years are a leap into the unknown for UK housing. On the one, hand there are few positive economic forecasts to be found at the moment. On the other, the market has proved resilient in equally dire circumstances in the past. So, perhaps the best advice we can give to conveyancers is to enjoy our current period of sunshine, however long it lasts.


Assessing the Stamp Duty Holiday.

Last week’s announcement of a holiday for stamp duty land tax (SDLT) on properties seems an obvious fillip for the housing market. Implemented as part of Chancellor Rishi Sunak’s summer statement, the tax break means that until 31st March 2020 anyone buying a home will only be required to pay SDLT if the value of the property exceeds £500,000. So far, so positive, but will the cut will have any long-term impact on the market. Is it anything more than a sticking plaster on a wounded economy? Starting off with some optimism; any extra stimulus of the market is welcome, particularly after the cryogenic freeze Covid-19 applied to it. 

What’s more, so far it’s worked. Rightmove has reported traffic to its listings increased by 22% immediately in the wake of the chancellor’s announcement of the £3.8bn tax. The property website said it received 8.5m visits, the highest in its 20-year existence. The number of people phoning and emailing estate agents via the site also hit a record high and was up 93% on the same day in 2019.

The announcement met with similarly spectacular results across the whole industry, with everyone from comparison site Zoopla to estate agents Winkworth reporting a dramatic uptick in interest. 

All of this points towards a short-term boost for the housing market. Add to this that positivity was rife in the market before the SDLT announcement, and the short-term forecast for property looks decidedly sunny. 

However, as always, there are some potential drawbacks to the scheme. The first is a question of fairness. While the SDLT cut is a welcome relief for the industry, it seems highly unfair that those who purchased property since the start of lockdown proceedings in March – at the urging of the government – aren’t subject to the same benefits. Do those people who risked infection and financial uncertainty while making their contribution to the health of the market not also deserve a break?

Of course, any scheme like this needs to be time-limited, but how hard or costly would it be to backdate the tax break – as many conveyancers are calling for – to the beginning of the lockdown period? 

The second major drawback is the scheme’s focus. We shouldn’t ask too much of a tax break, it’s not designed to be a root-and-brach overhaul of housing policy, but it is worth asking who is this for? 

The policy does little to address the housing market’s fundamental problems. The industry still faces issues with supply, mortgage availability, rising house prices, and high barriers to entry for first-time buyers (who, incidentally, are likely to be hardest hit by an economic downturn). 

This seems compounded by the fact that the measures extend to help those buying a second home or investment property. Is this really the part of the market that needs a leg-up?

Finally, it’s worth asking whether the reduction is enough to spark the confidence potential buyers need to sign up to the long-term liability of a house purchase? Many people will, understandably, still want to wait and see how the economic situation develops over the next six months. After all, the ghosts of 2008 still loom large in the public consciousness. 

None of this is to denigrate a much-needed boost for the housing market, on balance, the reduction is a good thing. However, it’s clear that if the sector is to continue its surprisingly positive trajectory, we need more. Much more. 


Is the Housing Market Really ‘Back’?

It’s been over a month since the Secretary of State for Communities and Local Government, Robert Jenrick, officially re-opened the English property market by lifting restrictions on estate agents and the buying and moving process. 

It was the announcement we’d all been waiting for and the industry breathed a collective sigh of relief at the end of the seven-week freeze. Perhaps things were finally returning to some semblance of normality.

But where are we nearly 6 weeks later? Is the housing market really ‘back’ in any meaningful sense of the word? And what can we expect for the rest of 2020 and beyond?

The Rebound

As of early June, the property market appears to have simply picked up where it left off pre-pandemic. Figures released by TwentyCi group reveal that the exchanges are being recorded at 68% of the same period in 2019, not bad given its two-month hiatus. Meanwhile, the market as a whole is operating at around 75% of the norms we saw throughout 2019.  

And this sunny outlook is being replicated elsewhere too. The Yomdel Property Sentiment Tracker is claiming that demand from vendors and landlords has risen to all-time highs. It’s results for the week ending 7th June show new enquiries from vendors seeking valuations skyrocketing. 

The number of vendors seeking a valuation rose 34% to hit 85% above pre-coronavirus levels. It appears that having put moving plans on hold, people are swarming onto estate agents platforms in a bid to get things moving again and into a new home before the summer is over. 

The Future 

So if the present state of the property market looks hopeful, what of the future? Well, it’s ultimately pretty mixed. Although, nothing like as bad as might have been expected after the last few months.

National estate agency, Savills, produces an annual five-year prediction for the housing market and has revised it’s November 2019 edition in light of the coronavirus pandemic. This new version makes for very interesting reading.


The property giant expects UK house prices to dip slightly throughout the rest of the year, dropping by 7.5% by the end of 2020. However, perhaps more importantly, Savills is standing by its original prediction of a 15.1% growth across the country by 2024. After the -7.5% fall this year, the data predicts a bounce-back of 5% for 202, followed by house prices rising by 8% in 2022, before returning to a steady 5% and 4.5% for the following two years.

Savills puts this bullishness down to factors such as better mortgage affordability and a ‘backlog effect’ of pent-up demand for UK housing. It also expects the market to closely shadow UK GDP, which is expected to fall during 2020 and bounce back in 2021. 

However, all this good news should come with a side of caution. There are still some major challenges ahead. 

Firstly, payment holidays are still in place for as many as one in seven mortgages. It remains to be seen how smoothly these will transition back to normal payments once things stabilise, particularly given we’re likely to see a tough employment market for the rest of 2020 and beyond. 

There’s also the first-time buyer elephant in the room. Demand for first-time property far outstripped demand pre-coronavirus, and this has only been made worse by months of downtime. Many lenders are withdrawing from the 90% LTV market, making it even more difficult for new buyers to get onto the ladder. Indeed, only 50% of mortgage products available pre-COVID are still on offer. 

On top of this, we still aren’t building enough new houses. The new-build market, which was already struggling to meet the number of properties required, has been set back further by a nearly two-month pause. It’s worth noting, however churlish it might sound, that all the demand in the world isn’t much use without a steady supply of new homes. 

Finally, it’s important to note that we just don’t know what comes next. The rest of this year could see the UK economy rally and return to the growth we saw pre-COVID, or it could be hit by a hard Brexit (yes, that again) and a debt crisis. As things begin to return to something like normality, let’s all pray it’s the former. 


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