Due to current lockdown measures and Scottish Government guidance, however, the completion of many property sales has been delayed, resulting in a substantial year-on-year decline in sales volume.
This fall in sales volume means that ESPC isn’t currently able to provide the meaningful statistics it normally would. Instead, it has compiled a useful timeline of coronavirus and the Scottish property market, highlighting week-to-week impacts and effects.
Social distancing starts
The commencement of social distancing meant a change to most daily lives, with many taking the option to work from home and businesses beginning to close their doors.
The social distancing announcement during this week also had an impact on interest in property, with key buyer and seller interest metrics on espc.com such as Home Report, viewing and valuation requests starting to slow, dropping to less than half of the volume seen in the weeks before social distancing was implemented. Before this week in mid-March, the property market in Scotland – like the rest of the UK - had seen a strong start to the year.
Some of ESPC’s agents started to innovate at this stage with the initial offerings of virtual viewings and virtual valuations, while the website also set up a free property advice phone service.
Lockdown measures are enforced as non-essential businesses are ordered to close and people are told to work from home if possible.
Registers of Scotland temporarily closed its application record.
In-person property viewings and valuations are no longer available, but ESPC agents adapt to continue providing key services.
Lockdown measures impact the property market
Non-essential businesses were ordered to close their doors and employees to work from home if they could. One major event in the property industry was that Registers of Scotland (ROS) had to close the application record, which led to the Law Society of Scotland (LSS) advising conveyancers not to complete property transactions until a further update from ROS.
Nevertheless, ROS and LSS were able to set up interim measures which enable property transactions to be completed later that week. Despite this, guidance from the Scottish Government the following week advised that house moves should be delayed if possible anyway.
The restrictions also meant that surveyors could no longer conduct Home Reports for most properties. (In Scotland, the majority of properties need a Home Report before they can be brought to market so this resulted in a notable decline in the volume of new property listings).
Unsurprisingly, the lockdown measures also meant that in-person property viewings and valuations were no longer allowed. To get round this, more and more ESPC agents adapted and innovated to start providing virtual viewings and valuations to ensure that people could still make a start on their buying and selling journey if desired.
As was to be expected, though, interest in buying and selling property fell considerably in the aftermath of the lockdown measures being introduced, with Google search volumes for property terms down to about 40% of the volume seen in previous weeks of the year.
This resulted in web traffic to espc.com falling by 40% compared to two weeks earlier - similar to the activity levels the website would expect at Christmas. Likewise, there was a decline in Home Report, viewing and valuation requests.
ESPC’s newly-established Covid-19 webpage with advice for property buyers and sellers became one of its most visited pages as people sought information and advice about the current situation in relation to buying property.
30 March–5 April
Scottish Government released guidance advising that house moves should be delayed if possible.
ESPC’s March 2020 House Price Report revealed a fall in sales volume while selling prices remain steady.
Scottish Government passed emergency law extending the eviction notice period to protect renters.
Scottish property transactions delayed
On March 31, the Scottish Government released guidance that house moves should be delayed if possible, asking for buyers and sellers to be flexible and negotiate a new date of entry if they were able to.
This resulted in the delay of the completion of many property transactions, causing the property sales volume in Scotland to decline dramatically.
In its March House Price Report, which covered the first quarter of 2020, ESPC highlighted a decline in property sales volume and listings, largely concentrated in the last two weeks of March.
Despite this, the average selling price and percentage of Home Report valuation achieved stayed fairly steady.
In order to protect tenants, the Scottish Government passed an emergency law to extend the eviction notice period to six months.
Property buyer interest remains in Scotland
Despite now being a fortnight into lockdown, this week saw some ESPC agents reporting that buyer interest remained strong.
A few offers were still being agreed on properties despite physical viewings being unavailable, with buyers relying on virtual viewings or the Home Report, schedule and photographs if a virtual viewing wasn’t available.
ESPC agents also reported that offers and notes of interest were being made subject to an in-person viewing once the current restrictions had been lifted, while others were asking to be contacted after the restrictions had been lifted so they could view properties when it was safe to do so.
Encouraging signs of property buyer and seller engagement
Some initial encouraging signs started to appear with regards to buyer and seller interest on espc.com, with small increases in web traffic and other key metrics.
While these were still lower than usual for this time of year, it did appear to suggest that some people were starting to develop more interest in moving home post-lockdown.
27 April– 3 May
Survey of ESPC agents revealed that there is a significant amount of properties waiting to be brought to market after lockdown.
Scottish Government announced that the second Scottish Coronavirus Bill would include details on an extension of the refund period for the Additional Dwelling Supplement.
Supply holds up
A survey completed by 37 of ESPC’s member solicitor estate agents indicated that the majority of respondents had five or more properties waiting to come to market after lockdown, while 27% of the agents that responded had 10 or more, suggesting a healthy supply of homes to be brought to market after restrictions are lifted.
Further encouraging signs were seen when it comes to engagement on espc.com, with web traffic up 20% compared to the first week of lockdown. This week also revealed that Google searches for property-related terms had grown since the start of lockdown, suggesting that people were still interested in moving home once safe to do so. This also coincided with increases in Home Report and viewing requests on espc.com.
During this week, the Scottish Government announced that the second Scottish Bill on Coronavirus would include details of an extension to the refund period of the Additional Dwelling Supplement (ADS) for those that had purchased before a certain date.
The ADS charge applies to second property purchases but is refunded if one of these homes is sold within 18 months. Due to the current guidance preventing most house moves, however, some people won’t be able to sell their previous home within the timeframe, which is why an extension has been proposed.
Looking to the future
“The Scottish property market has been impacted significantly due to the social distancing measures put in place as a result of the coronavirus pandemic,” Paul Hilton, chief executive of ESPC, said.
“Property sales volume and the number of listings are notably down compared to the previous year, due to government guidance.”
He added: “However, reports from our agents suggest that demand to buy and sell property remains. Innovative features such as virtual viewings and valuations allow people to make a start on their buying and selling journey at this time if they choose to.”
He concluded: “We expect there to be a healthy supply of buyers and sellers in the market when the current restrictions are lifted, which should help to foster a swift and stable recovery.”