It has been a year since the country entered its first lockdown, a milestone none of us could have envisaged back then. It also marks what was the start of one of the most tumultuous years the property market has ever witnessed.
From the initial drought that the first lockdown brought, to the flooding of the market in July post-lockdown, all aspects of the industry whether they be estate agents, conveyancers, or lenders have had to demonstrate flexibility.
Since the start of the first lockdown, the Council for Licensed Conveyancers has been regularly surveying our regulated community to see how the firms we regulate are managing and adapting through this period. It has also provided snapshots of how the wider market has been performing. In November we provided an overview of how the industry had fared over the previous eight months. Now, a full year on, what are the continuing effects of the pandemic?
As we are all very aware, the much-vaunted Stamp Duty holiday had the desired effect of boosting the property market, to the brink of collapse if you’d believe all the media hype around it. While it is true that that market did quickly become flooded overnight, our experience of speaking to our firms, in November, showed that less than half (46%) told us that they had to turn work away.
More recently, the backlog of transactions, in part, prompted the Chancellor to extend the holiday until September, a move welcomed by the industry. In November, 78% of our firms were concerned about a steep drop off in work come the end of March and said they would welcome a phased exit from the SDLT holiday. So, has this phased exit helped eased case-loads?
In our latest survey, which ran in February, just 41% of firms said that high caseloads are causing matters to take longer than usual. In fact, just over three quarters (76%) of our firms told us that it is delays arising from the impact of the pandemic on third parties such as local authorities and HM Land Registry that are causing delays. While 65% of firms told us that lender response times are also contributing to delays.
22% of firms surveyed said their current levels of work are at 100-125% of the level in February 2020, with 17% of firms saying work levels were at more than 126% of the February 2020 levels. These increases appear modest. We always encourage firms to be mindful of the levels of work they take on, to ensure that it isn’t more that they can manage, and the data seems to be bearing this out. We hope that the tapering effect of the SDLT extension will also allow firms to more effectively manage their workloads, and reduce risk.
In November when we spoke to firms about their financial situation, 42% had used the Coronavirus Business Interruption Loan Scheme, with the highest proportion being those with a turnover of £1-3m and £3-5m where 67% and 75% respectively had utilised the financial aid. When we spoke to the same firms again recently, 61% said their debt levels were now unchanged from this time last year, 23% said their debt levels are currently higher, but 10% said they were actually lower.
Seemingly, stronger financial positions alongside a more gradual withdrawal of the SDLT holiday have contributed to an uptick in industry sentiment. A very heartening 93% of our firms told us that they feel very or quite confident now about the future. This is certainly good news, and really quite telling. This is an industry that has had to adapt very quickly and demonstrate flexibility and innovation in order to not just survive but thrive.
In November, we said that the industry has much to be proud of in its handling of the crisis to date, a statement we stand by as estate agents, conveyancers and lenders alike have shown resilience in their navigation of the crisis to date.
The survey ran from 14 to 28 February and asked conveyancers about their work in the week ending Friday, 5th February. 150 firms participated.
Stephen Ward, is Director of Strategy and External Relations at the Council for Licensed Conveyancers.
Original Article from Property Industry Eye 29/03/2021