If you’re thinking about buying a home this year (or any year), it pays to take a strategic approach. Here are a few tips on how to do so.
Start by researching your preferred area(s)
Think about what you need in a place to live and then think about what you would like to have in your local neighbourhood. When you’re listing out your wants, try to give them a score so you know how much each one really matters to you.
Look out for places where you could make compromises to get a better deal. For example, you might need to live in a place where you can reach your work within a certain length of time. You might want to keep that time as short as possible. The compromise might be to look at locations where there are expected to be improvements made to public transport within the near future. If you can live with a longer commute for a short while, over the long term, you could benefit from a shorter commute and an increase in the value of your home.
Keep an open mind about adapting a property to suit your needs
Hopefully, you’ll find the perfect property for you very quickly, but if you don’t then you basically have two options. One is, of course, to keep looking and the other is to make adaptations to a property so that it is suitable for your needs (and preferably your wants as well).
Obviously, you need to be sensible about this. In particular, you need to think carefully about what, if anything, you could reasonably do yourself and what would need to be done by a professional. You’d also have to factor in the cost of making the changes if you decide to put in an offer on the property. Last but by no means least, if you’re thinking of making significant changes, it would be a very good idea to check whether or not planning permission would be required and if so to confirm at least the likelihood of getting it before committing to the purchase.
Do whatever you can to make yourself an attractive buyer
When sellers can choose from different offers they may focus on price or they may focus on convenience. In other words, they may accept a lower offer from a buyer whom they believe will be in a good position to take the sale through to completion in the quickest possible time and with minimal inconvenience to them. This means that the more preparation you do, the more attractive you can make yourself to a seller and the more chance you have of your offer being picked over higher ones because you are seen as a safe option.
Regardless of whether or not you already have a mortgage, you want to double-check your credit record and make sure that it is free of any errors. This would also be a good time to see if there is anything you can do to improve it, no matter how small of a change it seems. For example, if you have a credit card you never use but never got around to closing, you should make a point of closing it.
If you’re a first-time buyer/renter, then ideally you want to be pre-approved for a mortgage. If you already have a property, then ideally you either want to sell it before you put in an offer for another property or be able to demonstrate that you can buy another property without needing to sell your current one. In other words, try to avoid becoming part of a chain.
Your property may be repossessed if you do not keep up repayments on your mortgage.
It looks like 2020 is shaping up to be an interesting year in all kinds of ways. Let’s take a look at what will or could happen and how that could impact the housing market.
Brexit has happened
This is now a given and regardless of your views on the matter, hopefully, everyone can appreciate the fact that there is now at least some degree of clarity on the way ahead. There should be even more clarity by the end of the year when trade deal negotiations should be concluded. The fact that people now at least know the general direction of travel with Brexit may help at least some people resolve housing-related dilemmas.
A trade deal may or may not happen
In principle, any and all trade negotiations should be concluded by 31st December 2020. Given that these negotiations could be highly complex, it’s far from out of the question that there will be an extension to this deadline as there was to the initial Brexit deadline. How long this will be is, of course, anyone’s guess, but the fact that the UK is due to have a general election in 2025 may help to focus negotiators’ minds.
The sooner a trade deal is negotiated (or the sooner it is confirmed that there will not be one), the sooner people will be able to have a really clear view of how the UK and the EU are going to interact with each other over the immediate future and what it means for them. This has clear implications for commerce and hence for employment and hence for the housing market.
A decision will be taken on HS2
The HS2 project is now under review and a decision could have major implications for the housing market in certain parts of the UK. If HS2 goes ahead and delivers the promised benefits, then, regardless of what happens with Brexit, it could massively stimulate the economy in the north of England.
Alternatively, if HS2 either doesn’t go ahead then the north would not see any benefits from it, but if some of the money budgeted for HS2 found its way to other infrastructure projects then it might benefit from those. This might also stimulate the housing market, just in a different way what HS2 should have delivered.
The final option is that HS2 goes ahead but does not deliver as promised, in which case the UK would essentially be stuck with paying for a very expensive white elephant. This would, of course, be the worst-case scenario, but if it did happen, it would not only have potential implications for the housing market, but also potential implications for the next UK election.
It’s unlikely that there will be an election before 2025
In principle, the fact that the government has a clear parliamentary majority means that it could overturn the Fixed-term Parliaments Act 2011 and call an election any time it wanted. In practice, while the government may choose to overturn the Fixed-term Parliaments Act 2011 to give itself more flexibility on the exact date on which the UK goes to the polls, at present, it’s hard to see any reason why it would be motivated to call an early election.
Admittedly life happens as does politics, so it can’t entirely be ruled out, but hopefully, the next five years will at least see stability in government and government policy. This could help to stabilise the Pound Sterling on the international currency markets and thus reduce economic volatility in general, be that in terms of employment, interest rates, inflation or the performance of the stock exchange. This could be of significant benefit to the housing market.
If you’re now thinking of moving, please contact us to see how we can help with your mortgage.
We are completely thrilled to be recognised by Natwest as this award looks at advisors who in their words “have gone above and beyond normal expectations”. To be nominated two years in a row tells us that we’re doing something right. To us, helping our customers is second nature, we love what we do and it’s important to us to ensure that we do it well, to be acknowledged within our industry is amazing.
We’ll all be keeping our fingers crossed come March! To find out more click here.
We’d like to take this opportunity to thank the team for all of their hard work and commitment and our customers for their loyalty and support.
James & Mike