The government has told people not to move house amid the UK coronavirus crisis as the housing market enters a standstill.
Last night the government said: “We urge parties involved in home moving to adapt and be flexible to alter their usual processes.
“There is no need to pull out of transactions, but we all need to ensure we are following guidance to stay at home and away from others at all times.”
It came as banks pulled mortgages from the market. Halifax withdrew most of its mortgages, including first-time buyer loans, blaming a lack of “processing resource”.
Halifax is reportedly dealing with a mountain of mortgage holiday requests, where homeowners hit by the UK coronavirus crisis ask for time off paying their mortgages.
“Our priority remains the wellbeing of our colleagues and customers and we’re closely monitoring the developing situation and continue to follow official guidelines,” Halifax said.
“This has had a direct impact on our available processing resource and we have therefore withdrawn new mortgage and remortgage products across our residential range with a loan-to-value ratio of over 60 per cent.”
Banking body UK Finance said banks would extend mortgage offers for buyers who have agreed to purchase a property by three months. That could help them move at a later date.
Chief executive Stephen Jones said: “Lenders recognise that many people looking to move into their new home are facing significant stress and uncertainty due to the impacts of coronavirus. Current social distancing measures mean many house moves will need to be delayed.
Where people have already exchanged contracts for house purchases and set dates for completion … all mortgage lenders are working to find ways to enable customers who have exchanged contracts to extend their mortgage offer for up to three months to enable them to move at a later date.”
He added that lenders will help buyers “manage their finances as a matter of urgency” if their financial circumstances change due to the UK coronavirus fallout within the three-month mortgage offer extension period.
Meanwhile, banks have held discussions with the government over the coronavirus crisis’ impact on the UK housing market. The pandemic has made it impractical for banks to undertake surveys and complete paperwork.
It comes as economists warned the UK housing market will take a big hit from coronavirus.
As house prices recovered from Brexit, experts have predicted a huge blow from the UK coronavirus fallout. Yesterday Zoopla predicted the outbreak could knock transactions 60 per cent lower.
By Joe Curtis
Source: City AM