If recent media reports are to be believed, the ongoing political uncertainty is having a significant impact on the London housing market. According to the latest price index from estate agency portal Right Move, the impasse on Brexit has shaved £13,000 off the average asking price in the capital in just one month, which suggests hopes that the market might have weathered the ‘will-we-won’t-we-leave’ storm may have been premature. These statistics from Right Move are particularly significant because this is traditionally the time when the residential sector starts to gather pace – the fact that this is the first falling in the house price index at this time of year in nearly a decade is perhaps an indicator that Parliamentary process has transcended seasonal trends.
That’s not just about Brexit, either. The last few weeks in the House of Commons have also raised the likelihood of a General Election and a possible change of Government, bringing further uncertainty over interest rates and economic policy in the long-term.
In terms of how that affects people who are looking to move this autumn, clearly, a falling market has a different impact depending on whether you’re buying or selling. So, what are the opportunities and options for you if you’re committed to moving right now?
On the surface of it, the maths is relatively simple:
If you’re buying, then depending on the location (some London boroughs have continued to see average price increases over the past month) you’re likely to get more house for your money now than you were five weeks ago.
If you’re selling, then the real impact on you will depend on whether you’re in a hurry or not.
And, of course, the reality is that for the majority of housing transactions, most buyers are also sellers – and vice versa.
Sellers
There’s no real getting away from the fact that if you live in a part of London where prices are falling – according to Right Move, this accounts for 60% of the city – and you absolutely, definitely have to move now, you’re going to have to price your property well in order to sell it quickly.
If you’re not in a chain or can afford to test the market, then you’ll have a bit more wiggle room.
But all is not completely gloomy for sellers in London. The report also identifies that the amount of time a property is on the market before it sells has come down to a little over two months, suggesting that properties priced correctly will still move.
And don’t be blind to longer-term trends. For example, here in Fulham, according to the Right Move report, average house prices fell by 1.1% during August – but over the year since September 2018, they rose by 1.8%.
What that means is even taking into account the monthly drop, on average your property will still be worth more now than it was when you bought it if you’ve been in it for a year or more.
Buyers
There’s no doubt now is a good time to be a buyer in London if you’re committed to a move and looking to get more bang for your buck.
The considerations for sellers – competitive pricing and a buyer’s market – meaning there are definitely good deals to be had out there. Inevitably, the biggest opportunities are at the higher end of the market, where the falling market translates into bigger ‘savings’ on the price you pay.
And if you are in the position of wanting to trade up to something much bigger and you live in one of the boroughs where Right Move suggests your property might well have increased in value over the last month, then it’s also certainly worth looking at a move into a borough that hasn’t fared quite so well.
That could mean you get top dollar for your own property – and the opportunity to pick up more house for your money.
But regardless of where you are in the process, it’s always worth remembering that when it comes to buying a house, the decisions people make are personal. What is priced wrongly for one potential buyer might be the perfect asking price to another.
And there’s one simple truth in property that it’s always useful to remember: regardless of size, location and layout and regardless of the price an estate agent recommends you market at – a house is only ever worth what someone is prepared to pay for it.
Want to find out about your mortgage options? Take a look at our short guide to remortgaging.
To find out more about our friendly and professional mortgage service, fees and what we can do to help make sure you’re not paying over the odds for your mortgage, why not visit www.oportfolio.co.uk or give us a call on 020 7371 5063.
Oportfolio Limited is an appointed representative of Primis Mortgage Network, a trading name of First Complete Limited which is authorised and regulated by the Financial Conduct Authority
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