Opening property market could kickstart UK economy – Gardner

Estate agents may not seem essential, but the report authors Tory peer Lord Gadhia and GlaxoSmithKline chairman Sir Jonathan Symonds, clearly think that by letting agents out of the starting blocks early they can boost public morale and bring a vital sense of normality.

This makes sense.

A return to business as usual for estate agents could kickstart both the property market and the wider economy.

Multiplier effects

The report says the residential property sector has “wide multiplier effects”.

It argues that enabling estate agents to reopen might just jolt consumer sentiment, and the tanking economy, back into life.

House price indices recorded since the crisis hit should be taken with a pinch of salt because the number of transactions they are based on is close to zero.

Yet people’s sense that the property market is adrift is real, and its effect is insidious.

But to be more than a feelgood gimmick the government should back up its plan with some more concrete stimulus.

Temporarily scrapping – or slashing – stamp duty would be a good place to start, as would an extension to Help to Buy or providing some wriggle room in mortgage affordability regulations so as not penalise workers furloughed in the crisis.

Signs of life

Leaving aside the public health question of how estate agents might maintain social distancing while conducting viewings, there are several reasons to take the idea seriously.

The first is that unlike most previous downturns in house prices, this one was not precipitated by a bubble bursting.

Instead the market began 2020 with a renewed sense of vigour after three flat years of Brexit uncertainty.

Among those lucky enough to have kept their jobs, this pent-up buyer demand is likely to persist. In fact people’s desire to move may be magnified by months of being cooped up at home.

As the queues outside B&Q show, home is where many people’s heads and hearts are right now.

Experience to use

There is also the wealth of recent – and relevant – experience the industry can draw on as we navigate these difficult times.

Many of us in the property finance sector have been here before, barely a decade ago.

True, the global financial crisis was different; back then many lenders pulled down the shutters and simply refused to lend.

By contrast today many finance providers are well capitalised and keen to lend, but are instead being prevented from getting cash out the door by a logistical logjam – the total freezing of property viewings and surveys.

We’re continuing to write deals for a range of SME developers and property companies who are planning for the post-Covid future.

With several of Britain’s biggest housebuilders back on site and resuming construction work, it’s now time for the property sector’s public face – estate agents – to be seen again.