The housing industry is one of many areas of the UK economy affected by the ongoing coronavirus (COVID-19) pandemic.
The housing industry is one of many areas of the UK economy affected by the ongoing coronavirus (COVID-19) pandemic. According to property site, Zoopla, 373,000 house sales have stalled since the end of March after the government advised people to delay their moves. To help house buyers during the current pandemic, BBH Legal Services Ltd – a wholly-owned subsidiary of Thompsons – has provided legal advice explaining how the coronavirus (COVID-19) outbreak could affect your house purchase.
Can I still complete a house purchase during the coronavirus (COVID-19) pandemic?
From a conveyancing perspective, transactions can proceed as usual since much of the work can be completed remotely. Legally, a move into an empty property can also go ahead in the normal way, as can the purchase of a property in which the tenants are not being moved out. A transfer of equity, for example from a divorce or the passing of property in a will, can similarly proceed in a fairly standard manner.
The issues caused by coronavirus (COVID-19) when looking to complete a house purchases arise when considering the more practical aspects such as key exchanges, document signing, using removal firms, as well the scarce availability of estate agents and mortgage lenders, many of which have furloughed their staff.
Can I move into an occupied house?
The government’s current advice on house moves is that, where possible, they should be deferred until the lockdown has been lifted and the move can take place safely. While you may proceed with the transaction itself, only physical moves deemed as ‘critical’ can occur when the new house is occupied by the seller or the seller’s tenants.
What is a ‘critical move’?
A critical move is one that involves key workers and those on the front-line during the pandemic.
For anyone else, if contracts had already been exchanged before the restrictions were imposed, an agreement should be reached to delay the completion date. However, when one or both of the parties involved do not agree on a deferment, the move can then become ‘critical’ – or else the person refusing to complete the move becomes subject to the usual penalties that are built into the contract.
What other difficulties will I face when moving house during the lockdown?
Removal companies are unlikely to be available, as are painters and decorators, while gas and electric boards aren’t visiting homes to read meters. With many lenders furloughing their staff, mortgage payments may be also delayed.
How are practical issues like key handovers and document signing being addressed?
With most estate agents’ offices shut, the exchange of keys is a process that now must observe the government’s social distancing guidelines. As such, sellers are being asked to leave keys somewhere safe for the buyers to collect. Alternatively, they are left with neighbours who will hand over the keys from a safe distance.
Witnesses of document signing must be standing at a safe distance, and the equity release team are operating under their normal process, adopting the Equity Release Council's non-face-to-face approach by offering legal advice remotely via Zoom and Skype.
On 13 May 2020, the government guidance changed so those who wish to move home can do so, subject to public health requirements being met to ensure all moving home activities happen safely. The government now says that “people are free to move home, however the process of finding and moving into a new home is likely to be different, as those involved in the process will need to adapt practices and procedures to ensure that the risk of spread of coronavirus is reduced as far as possible.” Moving home is no longer viewed as ‘critical’ only, however, any home moves must be done safely and in line with social distancing and Public Health England recommendations.
Your conveyancer can advise you as to how best to move home following this change in approach. You should also read in full the Consumer Guidance, which can be found here. Please note that the changes only relate to properties in England.
Last reviewed 18 May 2020.