As housing transactions and residential agent sentiment hits new lows, industry leaders have called on the government to provide support in a post-pandemic market.
The RICS said the government will need to “consider all avenues” to drive market recovery after the crisis.
It has proposed a “stamp duty holiday” in the short-term and said further medium and long-term measures will be required.
Hew Edgar, RICS head of government relations, said: “These are exceptional circumstances and the government will need to consider all avenues that could feasibly rebuild confidence, bridging the gap between uncertainty and recovery.”
Edgar stressed that “the burden of stamp duty” could threaten future sales and added that the organisation would not consider such measures “on a whim”.
The RICS March UK residential survey found that 69% of agents are reporting a drop in new sales.
Sentiment for future sales was overwhelmingly negative, with 92% of respondents expecting drops in the next three months and 42% expecting drops over 12 months.
Edgar added: “While the UK’s health is the priority, our survey feedback suggests that the government will need to start considering medium and long-term measures that could assist a post-pandemic housing market.”
A new report from Zoopla reported a 70% decline in sales agreed since the UK went into lockdown on 24 March. It said demand for property has dropped by 70% and “bottomed out”.
Frozen market
Last week, the government effectively froze the housing market, calling for a halt on all non-critical home moves. Analysts predict that as the government looks to the industry post-pandemic it will likely step in with a combination of renewed initiatives like Help to Buy on top of potentially more radical funding boosts.
Homes England is exploring ways in which it can support the industry through its role as master developer, as well as proactively engaging with the sector to find solutions.
However, some in the industry have demanded more immediate support from the government’s housing accelerator.
Mark Booth, managing director at housebuilder Hayfield, said: “None of us can predict how severe and wide-ranging the impact of Covid-19 will be. But as Homes England has alluded to, the industry will definitely require support.”
He questioned the level of support that SMEs will receive during the crisis and raised concerns that it may lead to a greater market share being captured by volume housebuilders.
“As an SME housebuilder, we have been encouraged by the government and Homes England over the past two years to enter the market and are currently at the difficult part of the growth cycle. Now is the time for support,” added Booth.
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