Crisis. Turmoil. Unprecedented.
These were words rarely used pre-pandemic.
Now they’ve become staples of our nation’s news coverage.
And this week, they have been used more than ever to report on the economic waves caused by the Chancellor’s mini-budget last week.
As an agency that believes in always telling the truth, it would be highly disingenuous of us to say it’s business as usual without putting some sustenance behind it.
Rightmove have this morning issued some reassuring stats:
1) Healthy number of sales agreed
The number of sales agreed on Tuesday was the highest number in one day since early August
2) Limited impact on demand so far
On Monday and Tuesday, demand from buyers (sending leads to agents and developers) was down just 3% compared with other Mondays and Tuesdays this month
3) Average September rate of fall throughs
Over the past few days we’ve seen fall throughs in line with what we’ve seen for all of September
4) No change to rate of price reductions
On Monday and Tuesday 1.6% of all properties were reduced. This is the same level of reductions that we saw on other Mondays and Tuesdays this month
5) Mortgage products withdrawn, but there is still choice
A number of mortgage products have been withdrawn, but according to Moneyfacts there are currently over 2,600 mortgage products available in the market
Having compared this week to the same period in September 2019 and 2018 (pre COVID), then the number of buyers we have registered are the same as 2019 and are up 133% on 2018. The number of offers received have increased substantially.
However, it would not be prudent to mention that with interest rates rising and mortgage rates following suit, local home buyers and sellers are concerned.
We’ve spoken with many people currently buying and selling their homes over the past few days. And our advice to them has been simple.
Historically, the property markets have had significant ups and downs over the decades. BUT – if you look at it in cycles, property prices always increase.
Media predictions of a property market crash are just that – predictions, or to seek a dictionary definition: an act of saying what might happen in the future.
In June 2016 – after the Brexit referendum, it was predicted that property prices would plummet by up to 33%. They didn’t.
During the years of protracted Brexit negotiations, it was predicted that property values would sink by 25%. They never did.
And when the pandemic hit in March 2020, it was predicted that the housing market would come to a juddering halt for years. Instead, it stopped for a couple of months before seeing record price increases.
Of course, no one knows for sure, but the market will certainly change over the next few months. There is still good buyer demand although buyers have become more price sensitive. This price sensitivity may increase and budgets may reduce if interest rates rise further. However as we have buyers looking at most price points, we do not envisage a significant reduction of the number of buyers looking.
It's really important that we note that we have NOT seen chain’s collapse due to the perceived volatility. In fact – quite the opposite – buyers who have submitted mortgage applications are keen to move ASAP.
I’m thinking of moving. How can make I move house in this market?
It’s very simple: Choose a good team made up of:
1) Estate Agent
An agent needs to be chosen for their expertise, support, marketing and negotiating skill and ability, rather than a cut-price fee and fingers-crossed approach – therefore giving yourself the best possible chance of success.
2) Solicitor
We recommend solicitors based on how good they are, rather than because they pay us a referral fee. The solicitors we recommend are responsive and pro-active and work with us to progress a sale. As with agents, we would advise against using cheap fee companies without fully researching them.
3) Mortgage Broker
Martin Lewis has said that it is even more important now to use a Mortgage broker as they have access to products that may not be publicly available, and they will have the best knowledge of the mortgage market. If you are thinking of moving and want to speak to someone to understand what products you can access and how much you can borrow, we have brokers that we can recommend.
I’m moving. My house is under offer and I have had an offer on a house accepted. What should I do?
Some people already with a sale or purchase in progress may be getting nervous.
This is totally understandable.
But it’s worth considering this.
If you agreed on a sale and onward purchase two to three months ago, you are in what’s called ‘a relative market’.
This means that the price you agreed then is relative to what the market was doing then.
You may not feel like you’ve gained something, but you certainly haven’t lost something.
And for first-time buyers thinking of pulling out of a deal in motion and returning to the market in, say, 6 – 12 months, remember, it’s a big gamble.
These questions need to be asked.
Will you get as good a mortgage deal in 12 months?
What if prices remain the same?
What if they increase? (Think back to Brexit and Covid-19 property predictions.)
Have you factored rental costs into your decision? Is it better to start paying off your own mortgage now or continue paying off someone else’s?
The big picture
According to industry data, most people stay in their homes for several years.
So, it’s highly likely that your property will be significantly more valuable in the future if you buy it now, even with all the news swirling around the housing market.
And let’s not forget the lessons lockdown taught many of us.
That life is for living and not something we can put on hold.
If you want a new property or seek somewhere else to call home, start thinking five to ten years down the line from now.
Remember, a home is much, much more than a financial asset.
It’s the place your children grow up.
Where you enjoy your sunset years.
Where you grow the relationships that really matter.
Where you make memories that last a lifetime – not just an economic cycle.
At Walter & Mair, we’re here for home movers in Coulsdon, Purley and the surrounding towns now, more than ever.
Copyright 2022 Walter & Mair
