The COVID-19 pandemic has created a lot of confusion, not least for those who are in the midst of buying a property.
To provide clarity, we’ve answered some frequently asked questions below. If you need any further legal advice, please contact us at Breens Solicitors. We’ll be happy to help.
I’ve already exchanged contracts and the completion date is fast approaching. Can I still move into my new property?
Once you have exchanged contracts, you are legally obliged to proceed with the transaction. However, when it comes to your moving date, you may find that many removal companies are not operating. Moreover, it may prove difficult to follow social distancing rules.
Because of this, the government has advised that you delay the moving date until after the lockdown restrictions have been lifted. This should not affect your mortgage, as most lenders are extending their offers by three months.
You should only move into your new property if:
- You cannot negotiate a different completion date
- The move is critical – for example, you will be homeless or destitute otherwise, or you are a key worker
- You can adhere to social distancing rules – for example, you’re moving into an empty property
I’ve started the conveyancing process but have not yet exchanged contracts. Should I pull out of the transaction?
The government has said that there is ‘no need to pull out of transactions’. On the other hand, the Law Society has suggested that you should not ‘exchange until the situation is more settled’.
Therefore, the advice is conflicting. Ultimately, you must decide what best serves your interests. So long as you haven’t exchanged contracts, you are perfectly entitled to pull out of the transaction, if you are concerned about proceeding in the current climate.
You can also ask your solicitor to halt work on your transaction, until the crisis has resolved. Seeing as in-person property viewings are not currently allowed, it is very unlikely that the vendor will find another buyer in the meantime.
I had an offer accepted on a property, but now I’ve heard that property prices are going to fall. Should I reduce my offer?
Experts are anticipating a 5% to 10% drop in property prices. If this prediction comes true and you pay over the odds for a property now, you could put yourself in negative equity for many years to come.
So, if you have not yet exchanged contracts, you could ask to negotiate a price reduction. The vendor may be willing to accept, or they may take offence and refuse to proceed with you as their buyer. It all depends on their motivations.
To avoid the transaction (and possibly the entire chain) collapsing, it’s best to work in a calm and considerate way with the vendor. Ask your representative to approach them, voicing your concerns over potential price drops. You may be able to reach a mutually agreeable solution.
I want to proceed with my property transaction. What can I expect?
If you are keen to continue with your property transaction, you can expect a longer conveyancing process than usual. Due to social distancing rules, property surveys cannot be completed unless the property is empty, or the situation is urgent.
Delays are also being reported at the Land Registry and in relation to Local Authority searches. Additionally, it may be difficult for buyers and vendors to have their documents legally witnessed, creating further delays.
Make an enquiry
For help buying, selling and remortgaging a property, please contact us at Breens Solicitors.