How Will the Property Market Stand Up to Coronavirus?

What will the impact of the coronavirus be on the property market? At the moment it’s anyone’s guess but the signs are that, like most UK sectors right now, it’s not immune. House buying/selling and renting is slowing down – as you’d expect.

Property insurance claims

The Financial Conduct Authority (FCA) insists insurers should consider claims “fairly” in light of changes wrought by Coronavirus.

“We expect motor and home insurers not to reject claims because of a consumer’s understandable temporary change in how they use their vehicle and their home address, in response to government advice and the emerging coronavirus situation,” Christopher Woolard, the interim chief executive of the FCA said.

Some insurance claims are going through faster

Loss Assessors are reporting a quicker settlement on some claims. That’s because home-based loss adjustors aren’t having to visit properties, so have more time to spend on reviewing their files. It’s only larger claims – those which also require the insurance company’s approval – which are experiencing delays as insurance companies are operating with a skeleton staff.

Some insurers are advising their policyholders that their own contractor networks cannot come out to quote until the lockdown has been lifted and are suggesting clients source their own repair quotes – which is proving difficult for many people who don’t have a list of contractors in their phone contacts!

The latest government advice (updated 26th March), explains: ‘Work carried out in people’s homes, for example by tradespeople carrying out repairs and maintenance, can continue, provided that the tradesperson is well and has no symptoms.’ Of course, in this instance, social distancing guidelines should be adhered to for everyone’s safety.

Here at Action Insurance Repair we remain open and available for emergency and/or essential work. We can do this with two or less contractors who, once on the premises, can work two metres apart, wearing PPE (Personal Protective Equipment). We are carrying out surveys remotely where possible via video calls with clients and photographs and our specialist insurance industry quoting system allows us to prepare a quotation using room dimensions and meterage.  We can then send these to a loss assessor for forwarding to insurers.

Letting agents

Of course, all letting agents and landlords will now be aware of the Coronavirus Act whereby there has been a temporary stop on all evictions for three months (which could be extended). However, clarity has now been provided around existing cases, where notices had been served before the act came into force and evictions of licensees where those notices do not apply and a suspension has been issued on all ongoing housing possessions while courts are no longer processing existing evictions. Cases are being adjourned instead. This is to enable people to social isolate and not infect or pass on coronavirus symptoms to others. It makes sense.

Having said that, landlords are still liable for repair work – but only if it is essential ie a broken boiler, a leak, an ingress of water etc.

Rents still due

Landlords are also being asked to give tenants – who don’t have sufficient funds during the next few months – a chance to pay rent at a later date. In June the government’s ‘payouts’ of 80 per cent of monthly wages should then take effect. In turn, landlords will receive a similar three-month reprieve on buy to let mortgage payments.

Some landlords are finding problems getting insurance companies to pay out for loss of rent as a result of tenants deferring rents under the new government coronavirus rules. Direct Line are one of these. They say they’ll only process claims which had started prior to the new guidelines being issued.

Similar problems may arise re action landlords need to take if their property is unoccupied for more than 30 days. It’s always worth

Time for training?

If you are going stir crazy stuck at home, now might be a good time to get some training done. If you are a letting agent, Landlord Law Services are offering a fantastic free training course, which might provide a useful refresher when it comes to landlords insurance and any potential insurance claim.

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