23rd April 2020
Last week the Government extended the lock-down period to the 7th May. The figures from Government over the past few days indicate London has already seen the peak of this dreadful pandemic, which will hopefully mean the rest of the UK will see a peak later this week or next, and there will soon be a plan in place to lift the lock-down. The lifting of the lock-down will undoubtedly be ‘phased’, allowing for smaller shops and businesses to operate with reasonable social distancing. I would expect larger venues, where ‘cheek-by-jowl’ crowds are unavoidable, to not reopen for some time yet. Estate agents were one of the last businesses to be formally told to close, and cease undertaking face-to-face viewings. As viewings (and valuations) can easily be undertaken with social-distancing if pre-planned therefore I suspect estate agents will be one of the earliest businesses to be given the ‘green light’ to return.
Throughout the ‘lock-down’ estate agents have in fact been lawfully capable of completing sales and lettings that were agreed and/or contracted before lock-down, especially where the subject property was vacant, and had been for some days or weeks before lock-down. The pipeline sales we had agreed prior to lock-down that have not already completed are all still in place; none of our buyers or sellers have withdrawn from the transaction. These will complete almost immediately once lock-down is lifted.
Whilst our physical office has been closed enquiry levels for properties on the market for sale and to let have fallen dramatically. That said, we are still getting a number of daily email and phone requests from prospective buyers and tenants asking to be put on ‘the list’, to view as soon as lock-down is lifted. The numbers are small, akin to the levels we would usually see on a Sunday, but the fact we have lists of prospective buyers and tenants ready to view bodes extremely well for the restart, when our team can get going again. It also demonstrates that demand for property in north Leeds has not diminished. Some economists are predicting a fall in demand (and prices) for property post-pandemic. We have yet to see the full impact on the economy post Covid-19, which may mean things could change, but our data is not indicating this to be the case to date.
There is going to be an economic recession (if not a depression as predicted by some pundits) but from my experience over the 40 years I have been an estate agent in Leeds, I would be surprised if this impacts heavily on the local housing markets. Leeds has a very robust economy. There is a very strong service sector in Leeds (banking, accountancy, law, IT, etc.) and in difficult macro-economic times, these businesses tend to thrive. Off the back of this primary service sector the restaurants, cafes, bars and pubs generate their income. How these businesses operate may well have to change, especially in the short term, but entrepreneurs are excellent at adapting to change. Some businesses will disappear, especially those which were financially fragile prior to the lock-down. New businesses will emerge and bloom. Leeds has always been a magnet for people seeking employment from outlying areas, and with a shortage of housing to accommodate the demand should support current rents and capital values. Leeds has consistently out-performed many other towns and cities. I see no reason to believe this will change dramatically in the medium to long term.
We all face a very interesting 2020 and 2021 (possibly even longer). There will no doubt be winners and losers, but without question society will carry-on. We may have to adapt to a new post Covid-19 world but we will still need a roof over our head and, for most people, property will be their most important and valuable asset.