Whether you’re looking to move house or you’re worried about your income, here’s our guide to the lockdown and how it will affect you.
2020 continues to be an unpredictable year, with Prime Minister Boris Johnson announcing last night that, subject to Parliamentary approval, a new national lockdown will start from 5 November and last until at least 2 December.
Non-essential retailers will be forced to close for a month. It is not yet known if estate agents’ offices are considered ‘non-essential’.
So what does this mean for your mortgage payments? And what if you had planned to move house?
Paying your mortgage
Firstly, it’s reassuring to hear that the mortgage payment holiday scheme that was due to end on 1 November has been extended. Borrowers who have not yet requested a mortgage payment holiday can now apply for one for six months. Anyone already on one can top up to six months without this being recorded on their credit file, according to the government
If you are concerned about your ability to pay your mortgage, don’t delay – speak to your lender or feel free to contact us.
However, we would advise only taking a mortgage payment holiday if you really need one, as you will incur more interest overall. If you can afford to meet your monthly repayments, it’s best to do so.
What about your income?
The furlough scheme has also been extended throughout November. Chancellor Rishi Sunak has announced that the government will cover 80 per cent of employees’ wages for hours they are not working, up to a maximum of £2500 per month.
If you are self-employed, you will be able to claim a third grant of up to 40 per cent of your average monthly profits (provided you have been eligible for the Self-Employment Income Support Scheme before), up to a maximum of £3750. The next grant will be from November 2020 to January 2021. There will be a further grant from February 2021 to April 2021. Applications for the next grant should open shortly.
The Chancellor had originally planned to cover just 20 per cent of average monthly profits for the self-employed from November to January, but on 22 October he decided to double the support to 40 per cent.
Businesses forced to close in England will also receive grants worth up to £3000 per month. You can find more information on the furlough scheme and support for businesses here.
What about the housing market?
Unlike the previous national lockdown, which saw the housing market close from 23 March until 13 May, the housing market in England will remain open during the four-week national lockdown. The Ministry of Housing, Communities & Local Government has confirmed this.
Anyone viewing or selling properties should continue to follow guidance issued in August, which encouraged virtual viewings where possible. In-person viewings can only last for 15 minutes, and buyers and vendors must follow social distancing rules, including wearing a mask and gloves. Vendors must leave the property during the viewing. Vendors are advised to open all internal doors and clean door handles and other surfaces after each viewing.
House moves in England can still go ahead but the process is expected to take longer. When moving house, you are advised to do as much of the packing yourself as possible.
The situation is different in Wales during the current circuit-breaker lockdown which started on 23 October and is expected to last until 9 November. Buyers and sellers can move house in Wales if they can’t postpone their moves, but in-person viewings are not permitted. Virtual viewings can go ahead.
In Scotland, property sales and purchases are still permitted.
The previous national lockdown sparked a rise in the number of people deciding to move home after being stuck indoors for months. The next lockdown could have the same outcome. The rise in those working from home or those who have decided they need more space will see more homeowners keen to upsize. A spokesman for estate agent trade body Propertymark said a second lockdown ‘could reaffirm people’s reasons and desire to move even more’.
If you have a question about any aspect of moving house or getting a mortgage during the current situation, please get in touch with us.