What the UK Government’s response to COVID-19 means for your estate agency

Things are moving fast in this new COVID-19 world. We want to do our bit and help you stay informed, so please bookmark this page where we will be bringing together information relevant to the property industry as it happens.

A quick note about the below: 

The information in this blog post is current as at 4:00am on 21 May 2020. However, it is intended as a guide only. Please make sure you stay informed as this event continues to unfold. Also, because some elements of business support are devolved, the measures you can access may differ if your estate agency operates outside of England. Please scroll down to see the specific business support measures announced for Scotland, Wales and Northern Ireland. 

What support is available for your business?

As you’ll see from the below, a number of financial aid measures have been made available in the last few weeks. The eligibility criteria can get quite confusing, so the government has created a handy tool to allow you to easily see what support is available to you, depending on your circumstances. You can access it here

A new Bounce Back Loans scheme 

On 27 April, it was announced that from 4 May 2020, small businesses would be able to apply for 100% government backed loans of £2,000 to £50,000—interest free for the first 12 months, and available on loan terms up to six years. 

Applications can be made here, but it’s important to note you cannot apply if you’re already claiming under the CBILS scheme below. You can however talk to your lender about transferring the loan you have received under CBILS into the Bounce Back Loan scheme.

Support for business through the Coronavirus Business Interruption Loan Scheme (CBILS)

CBILS essentially provides lenders with a government-backed, partial guarantee of 80% to encourage them to lend to smaller UK businesses who are losing revenue and seeing their cashflow thrown into disarray by COVID-19.  

British Business Bank operates CBILS via its accredited lenders—a collection of over 40 high-street banks, challenger banks, asset-based lenders and smaller specialist local lenders. These lenders can provide eligible businesses with up to £5 million (up from the initially announced £1.2 million per business) in the form of:

  • term loans
  • overdrafts
  • invoice finance
  • asset finance

available on repayment terms of up to six years.

If you’re eligible and decide to get a loan under this scheme, the Government will cover the first 12 months of interest payments as well as any lender-levied charges (although, you’ll remain 100% liable for the debt). 

Read more about the scheme here, review the eligibility checklist and then follow these steps to apply. 

Support for large businesses through the Coronavirus Large Business Interruption Loan Scheme  (CLBILS)

CLBILS has been set up to give banks the confidence to lend to even more businesses. Under this scheme, the government provides a guarantee of 80% to enable banks to make loans of up to £25 million to businesses with an annual turnover of more than £45 million. The upper limit of £500 million was removed on 16 April. Also, firms with a  turnover of more than £250 million will be able to apply for loans of up to £200 million. 

Businesses will need to have a borrowing proposal which the lender would consider viable (if not for the COVID-19 pandemic) and which would enable them to trade out of any short-term to medium-term difficulty. Similar to CBILS, it’s anticipated that this scheme will be available through a range of accredited lenders. 

Applications are now open. You can find eligibility criteria and information about how to apply here.  

Exemptions from business rates 

Estate agencies were initially omitted from a long list of high street businesses that would receive help to pay their rates. However, on 25 March 2020, HM Treasury announced that estate agencies and letting agencies in England that have closed as a result of the pandemic will now be exempt from business rates in 2020-21. 

Eligible businesses will either receive a new bill reflecting that discount or, if they have already made payments, a refund. 

The Devolved Administrations will receive funding under the Barnett formula to support businesses in Scotland, Wales and Northern Ireland.

Grant Relief From Business Rates

The government has announced a £20 billion package for local English authorities. Small businesses that already pay little or no business rates (because of small business rate relief, rural rate relief or tapered relief) will be eligible for a one-off coronavirus grant worth up to £10,000 to help them meet their ongoing business costs. 

If you’re eligible, your local authority should contact you. Any enquiries about this grant should be directed to that same local authority. Find yours here

Coronavirus Job Retention Scheme

This scheme allows employers to claim 80% of furloughed employees’ usual monthly wage costs, up to £2,500 a month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on that wage. 

This scheme is open to all UK employers that had created and started a PAYE payroll scheme on 19 March 2020 (previously 28 February 2020). The scheme will be from 1 March 2020 until October.

You can download a step by step for employers here.

VAT payments deferral

This is another initiative to help businesses manage their cash flow. If you have a VAT payment due between 20 March 3030 and 30 June 2020, you can either defer the payment until a later date or pay as normal. More details are available here

HMRC’s Time to Pay service

If your estate agency is unable to pay its tax bill, you could avoid late payment penalties by contacting HMRC. Who you need to contact depends on the type of payment. Contact details are listed here

Self-Assessment payments deferral 

If you’re due to pay a self-assessment payment by 31 July 2020, then you may defer payment until January 2021 (without penalties or interest). You don’t have to be self-employed to be eligible.

To help you pay the deferred amount when it becomes due, you can set up a budget payment plan.

Self-employment Income Support Scheme

This Scheme is specifically for the self-employed (including members of partnerships) who have lost income due to this pandemic.

It’ll allow you to claim a taxable grant worth 80% of your trading profits for the next 3 months (capped at a maximum of £7,500 altogether) —with extensions possible, if needed. More information about eligibility requirements and how the scheme works is available here.  

Reclaim Statutory Sick Pay 

Small-and medium-sized businesses and employers with fewer than 250 employees will be able to reclaim up to two weeks of Statutory Sick Pay per employee, if there have been staff absences due to COVID-19. You can read about how it works here before the online application system opens on 26 May 2020.

Protection from eviction

Commercial tenants in England, Wales and Northern Ireland who can’t pay their rent due to this pandemic will be protected from eviction. This means that if your estate agency business misses a payment up until 30 June 2020, you won’t forfeit the lease and be forced out of the premises. 

It’s important to note that this isn’t a rental holiday—your business will still have to pay that rent at some point. 

Specific support for businesses in Scotland

On 18 March, the Scottish Government announced a package of measures worth £2.2 billion to support Scottish businesses—superseding the £320 million package announced on 14 March.

Specific to small business, it includes:

  • a 1.6% rates relief for all non-domestic properties in Scotland, which will automatically be applied to your bill by your local council
  • a one-off £10,000 grant for eligible small businesses, through the Business Support Fund

Keep checking the government’s business support website for more information. 

Specific support for businesses in Wales  

On 30 March, the Welsh government announced a £1.1 billion supplement to its original £1.4 billion support package for businesses affected by coronavirus. 

The most important things to note are:

  • a £500 million Economic Resilience Fund will be set up to help businesses, charities and social enterprises survive the crisis. It’s broken down as:
    £100 million for the Development Bank for Wales
    , to help businesses with cashflow problems. This money will be used to give limited companies, partnerships and sole traders who have been trading for over two years access loans up to £250,000 fixed at 2% with an interest and capital repayment holiday for the first 12 months; and
    £400m for another emergency fund, which will give grants of £10,000 to businesses employing less than nine people, grants of £100,000 to businesses with 10 to 250 employees as well as support for particular larger companies that are significantly important to Wales. Applications open on April 17 2020. In the meantime, you can check your eligibility here
  • Separate from that fund, there are also two grants available to support businesses registered to pay rates on their premises. Estate agencies may be eligible to receive the second of those grants—a £10,000 grant for small businesses with a rateable value of £12,000 or less. Further information will be available on your local authority’s website
  • The Development Bank of Wales will also offer all of its business customers a three-month capital repayment holiday, to help them manage the financial fallout. 

Make sure to bookmark this page of the Welsh Government’s website also. 

Specific support for businesses in Northern Ireland 

In Northern Ireland, businesses in Northern Ireland may be able to access financial assistance through:

  • the COVID Small Business Grant, which will provide small businesses (those with a Net Assets Value up to £15,000) with a £10,000 grant. More information about the grant and how to apply can be found here.  
  • the £100m emergency rates package for businesses, which provides a three month rates holiday for all businesses. 

Please bookmark the Northern Ireland Business website. Invest NI are also providing up-to-date, practical advice for businesses. 

And here are some other helpful sources of info:

The Small Business Commissioner’s office can provide practical tips and support to help you get paid on time, manage other cashflow issues and assist you through arbitration to investigation and enforcement. 

Business Healthy keeps their blog up to date with plenty of resources to help employers support the health and wellbeing of their workers through these difficult times. 

The UK Government has said that, wherever possible, house moves should be delayed until the stay-at-home measures are lifted. Your industry body may provide some guidance about how you can keep doing your job whilst adhering to the social distancing rules:  

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