‘Cut your overheads’: Conveyancing firms face battle to survive Covid-19
By Monidipa Fouzder
Conveyancers may have to be ‘cruel to be kind’ and shed staff to survive the Covid-19 lockdown, a conveyancing expert has said. The warning comes after estate agents were reportedly told they should close their offices immediately.
On Monday prime minister Boris Johnson announced that all shops selling non-essential goods must close immediately to slow the spread of the coronavirus. Yesterday NAEA Propertymark, a membership organisation for estate agents, said it received guidance from a senior civil servant that agents are not ‘essential businesses’ under the new rules and should close their offices immediately. There should be no in-person viewings, routine inspections or house moves.
The British Association of Removers, a trade body, says its members should only complete moves already under way. Any move that has not started should be cancelled or postponed.
The Law Society has issued guidance on residential conveyancing transactions. However, worried conveyancers have contacted the Gazette about what the tougher measures could mean for bottom lines.
Residential property conveyancer Rob Hailstone, chief executive of Bold Legal Group, said conveyancers have survived many difficult periods over his 45 years in the business but ‘none were quite like what we are all going through now’.
He added: ‘With the country in lockdown for at least three weeks (probably longer) it is a foregone conclusion that the public will, for the time being at least, not be looking to move home. This lean period could last for up to six months (or more). The only real way to survive is to cut your overheads as much as is possible. Stop payment on anything not essential and talk to the suppliers you still need or want to buy services or products from. You might even have to be cruel to be kind. If you go bust, no one has a job. If you survive, anyone you have had to lay off might be re-employed. And, once the crisis is over, there will be some pent-up demand and you will once again be busy and profitable.’
Peter Ambrose, managing director of London and Guildford conveyancing firm The Partnership, does not believe the conveyancing sector will necessarily come to a standstill.
He said: ‘Yes, there are challenges about people completing and actually moving into their properties, but the process should continue moving forward. We do have concerns whether search agents will still have access to local land charges offices, but, based on the data that we are seeing in London and the south east, deals should hold together albeit taking longer than before.’
Search Acumen, a property data business which analyses Land Registry data to examine competitive pressures, said viewings have plummeted as potential buyers back away from visiting properties where the risk of infection is unknown, while sellers baulk at the possibility of letting strangers into their homes. However, Andy Sommerville, Search Acumen director, said existing technology has relieved some market pressure – citing virtual viewings, which have protected all parties in the homebuying process.
(Courtesy: Law Society Gazette)