Revealed: how to buy a house when you can’t leave the house?

It’s a question many of us will have been asking ourselves when, during these lockdown times, we are all being asked to stay at home as much as possible to avoid transmitting the disease and potentially overwhelming the NHS’s ability to cope with Covid-19. 

How can it be possible to purchase a property when you can’t actually visit any homes in person, and when the likes of surveyors, estate agents and even Energy Performance Certificate assessors aren’t allowed into people’s abodes? 

Here, Hannah Aykroyd – founder and managing director of leading PCL (Prime Central London) buying agency Aykroyd & Co – reveals all. 

“It’s difficult to concentrate on almost anything at the moment, and it certainly seems strange to think about the future. But if you’re planning to buy a house in Prime Central London in 2020, it is a good idea to take as many steps as you can right now toward completion,” Aykroyd said. “Once the market fully restarts, we expect a flood of pent-up demand. In an environment of disastrously low stock levels, this has the potential to make an already competitive market extremely challenging for buyers.”      

She adds: “Due to the banking sector being ultra-cautious, coupled with the government’s guidelines, transaction levels have dropped sharply. However, while it’s certainly challenging to complete a property transaction right now, it isn’t impossible.” 

Why not just wait until the Covid-19 crisis is over?  

Prime Central London is a highly competitive environment for buyers, Aykroyd advises. “Even in the Brexit doldrums, the competition among buyers for the limited stock of quality properties never eased up.”  

During 2019, when the market hit its Brexit bottom, she says Aykroyd & Co did not have a single clear run at any property. In every situation, the company was involved in competitive bidding scenarios, and - quite often for the off-market properties - up against buyers also represented by buying agents.  

“We are always under extreme time pressure to get deals done for our clients before they lose the property they’ve fallen in love with to a competing buyer,” Aykroyd says. “This has certainly stopped for the moment, as people are understandably putting almost every aspect of their lives on hold. That can’t last; things will have to carry on at some point. People will need to move house. Rather than feel stuck or helpless, this time can be used fruitfully to get all your ducks in a row.” 

Why is PCL such a competitive market? 

Aykroyd says there simply aren’t enough ‘best-in-class properties’ available to meet the considerable demand. This situation grew worse month-on-month in 2019 and early 2020, up to the point where there is now quite an acute shortage of stock available.  

“In part due to the current crisis, we foresee this issue remaining for most of the year, with the next influx of properties likely entering the market in the autumn,” Aykroyd explains.  

“We have always needed to look at properties that are off-market for our clients, ringing round to our personal contacts to unearth interesting opportunities. There just isn’t an adequate supply of quality properties available on the open market. And indeed, if I was a vendor of a substantial property within Prime Central London my preference would always be a discreet, off-market campaign.” 

What exactly can be done right now? 

A normal search process for a PCL home takes 2-6 months, Aykroyd says. “So, as much as your mind may be preoccupied with present concerns, and as worrying as it may be to commit to something in an uncertain future, it’s worth considering taking steps to begin your search, to do what can be done in the current circumstances.” 

As an example, she points to one client who would like to buy a 2-3 bedroom flat priced at £2.5 million in Maida Vale. As per the firm’s normal process, the team at Aykroyd & Co spent about a week picking up the phone to their contacts, getting a full picture of what is both on and off the market that meets the client’s brief.  

“While we weren’t physically able to view any properties on her behalf, due to the current crisis, we were able to draw on our knowledge of the area, buildings and price per sq ft, as well as further detailed research,” Aykroyd says.  

“This allowed us to whittle down the list of options, as we scratched off flats that were north-facing, others that were too far from a Tube station, still others that were on a noisy, busy road.”  

Aykroyd continues: “Some of the flats we’d already viewed for recently completed searches, while others are similar to ones we have previously viewed. Therefore, we were able to send our client a carefully edited list of over a dozen on- and off-market properties for her consideration. We then scheduled a call to discuss these options in detail, drilling ever deeper into our client’s wish list.”  

Importantly, she said, her team managed to narrow the shortlist to five properties. “In her case, none of the flats she was interested in are available for online viewing,” Aykroyd adds. “We will, of course, continue to closely track the market to dig out any other opportunities that may arise, but at least we now have a shortlist that we can view immediately once the government advises that it is safe to do so and thereby being ahead of the curve.” 

Meanwhile, ‘focused and armed with a strong sense of the market’, she is now also safely onboarded with a property lawyer from Aykroyd & Co’s list of recommended professionals, and has started the mortgage process with a known and trusted mortgage broker.  

“I would estimate she’s about 3-4 weeks ahead of other buyers and so we will be in a good position to quickly secure her property of choice when restrictions lift,” Aykroyd claims. 

What are the biggest hurdles to completing a residential property transaction at the moment?  

“The biggest hurdle is for those buyers who are looking for a mortgage,” Aykroyd explains. “While the base rate is at an all-time low of 0.1% and mortgage rates are historically low, many banks are being selective over which new customers they take on, as well as withdrawing products with a high LTV.”  

The primary reason for the banks’ caution, Aykroyd says, is the unknown of how the Prime Central London market will be affected from a pricing perspective in both the short and medium-term, as well as valuation surveyors being often unable to physically value properties at the moment. 

“However, we work with some fantastic mortgage brokers for our clients, and it’s clear that there are banks that are adapting to the current situation by allowing surveyors to provide drive-by and desk-valuations,” Aykroyd said. “There are also banks that are willing to front-load all their paperwork, with the valuation more of a final rubber stamp at the end.”  

Aykroyd says that it’s also worth remembering, that, surprisingly, some elements of the market continue to operate almost as normal. “Property lawyers are at their desks and happy to work on transactions, albeit from home. For our cash buyers – who tend to be investors - it is relatively easy to transact on a house or flat. Indeed, we have been submitting blind cash offers on behalf of key investors we have worked with previously and are negotiating firmly to secure an excellent deal for them.” 

Is now a good time to buy?  

“We are always focusing on the long-term outlook on behalf of our clients. It was only a few months ago that we were advising buyers to overlook doom-and-gloom Brexit forecasts about London and residential London property,” Aykroyd says.  

While some experts were ‘ominously predicting a hard Brexit followed by years of recession’, she said her firm recommended buyers make considered investments in best-in-class properties, take a long-term view and plan to hold for ideally 10 years.  

“Clients who took our advice, buying quality properties in 2019 at the recent bottom of the market, when sterling was also at an historic low, were thanking us in January and February,” she insists.  

“March has been another matter, of course,” she admits. “The coronavirus crisis has been terrible for so many; it is not like anything we’ve seen before. Even so, our advice remains the same. Stay steady; buy Prime and Super Prime London residential property; buy best-in-class; and plan to hold for ideally 10 years. People need homes, and in an uncertain world best-in-class PCL residential property remains relatively low risk, particularly when you can retain and time your exit well.”