Home viewings may be back up and running again but the coronavirus property market is still in a very different state than it was back in February.
Lenders are still wary of opening their branches to the public, and the Government is still urging buyers to view homes by video before going in person.
And while lockdown may in part be over, it looks like a lot of these new conventions might be sticking around for some time.
So what might the new future of buying a home look like?
What does the new future of buying a home look like, and how can you still get the best deal?
This week HSBC joined Nationwide in offering video conferencing for mortgage appointments – meaning customers won’t have to risk going into their local branch to discuss mortgage options.
Zoom among other video conference software services boomed in popularity during lockdown as firms use them to host internal and external meetings.
And there’s no suggestion that these services will fade into obscurity anytime soon, amid forecasts that working from home could be the new normal for many companies even after the pandemic ends.
An Zoom mortgage interview or advice will be very much like going into a bank or building society and has more of a personal tough than a phone call.
It also comes with an advantage of being able to recall what went on more easily.
When it comes to taking mortgage advice through a video call, all audio will be recorded, so ensure that you ask your lender or broker for a copy for your records.
HSBC’s rendering of how a Zoom mortgage appointment ‘might look’
You also have the option to record calls yourself on most video softwares, so it may be useful to do this too.
It’s also likely that banks and building societies will increasingly ask customers to scan and send important documents. Most smartphones now have the facility to do this, so you won’t need to rush out to buy a scanner.
Most lenders have severely limited their branch activity so if you feel more comfortable doing all of this in person, you may need to wait a little longer.
The Government lifted its ban on viewing properties back in May but ‘virtual’ viewings remain a key component of the Ministry of Housing’s guidelines.
Lots of estate agents are now offering these viewings, which give prospective buyers a video tour of the property.
The Government says that people should use virtual viewings before visiting properties in person where possible, in order to minimise the risk of spreading coronavirus.
How much people are actually following this is a matterof debate, however, the coronavirus viewing rules take up time and mean agents can do less physical viewings in a day.
Buyers will also need to wash their hands before viewings, not touch surfaces, and only bring members of a single household.
It’s likely that these measures will remain in place for the foreseeable future.
But if you are particularly vulnerable or just too cautious to view a home in person, is it ever a good idea ever to make such a big investment based off a video?
There are a few extra precautions you can take if you’re in this situation.
Currently estate agents are offering both ‘live’ video tours and pre-recorded ones.
Always go for the former if you can, as you can ask to see parts of the property in more detail as you go along.
If you do go for a live tour, ask the agent to save you a copy so you can view it again later – you might catch something you missed the first time round.
It is also a good idea to visit the area in person to get a feel for it without actually entering the home.
Spending some time on the street could be the difference between buying and avoiding a house in an area with severe noise pollution, for example.
The 30-year fixed rate mortgage
Back in November the Conservatives made the unusual manifesto promise of opening a ‘new market’ in long-term, fixed-rate mortgages for first-time buyers, in particular for those with small deposits – similar to deals in America and Europe where 30-year mortgages are more normal.
The party suggested enlisting funding from institutional investors such as pension funds in order to do this.
However, experts within the mortgage sector cast doubts on how successful such a scheme would be, citing a potential lack of consumer appetite for locking into a deal for so long.
Chief among most borrowers’ concerns would be fixing at too high a level during the interest rate cycle, and whether these long term deals would carry expensive exit fees.
With the base rate at 0.1 per cent, this may not be a worry for most people right now.
Lenders haven’t leapt at the chance to offer 30 year deals so far, but longer fixes are increasingly becoming more popular.
Lenders haven’t offered 30 year deals so far, but longer fixes are becoming more popular
And as demand grows, rates are dropping. Barclays for example released the first ever 10-year mortgage under 2 per cent interest this month.
Moves to tempt borrowers looking to fix for longer were made well in advance of the coronavirus outbreak.
These borrowers may have grown in number still in the months since as homeowners increasingly look for stability amid bleak economic forecasts.
This, combined with the current low cost of borrowing money for banks, has pushed rates on longer term mortgages down to levels not previously seen.
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