If you’re planning to buy a house, it’s worth thinking about the timing of your purchase. While it may feel like the right time for you, it may not be the right time for your budget.
For example, a market full of properties for sale is a great time for buying a home as a purchaser, because there’s a better chance of getting a good deal. But if there aren’t many properties for sale, then you could end up paying over the asking price to compete with other buyers who are also finding it hard to find a home.
To help you make your money go further, we’ve tackled and answered some of the most important questions to help you find out if now is the right time for you to invest in a new home.
Preparing to Buy a Home
Purchasing a property is a massive investment; from solicitor fees to deposits, there is a lot of money that goes into the buying process. It’s a decision that requires careful thought and planning, so doing your research and talking to a mortgage advisor is highly recommended.
Along with being, potentially, the biggest investment that you’ll ever make and the demand for property starting to increase, you want to be sure that you’re buying at the right time to get the best value. After all, you don’t want your hard-earned savings to go to waste by spending more than you need to. For more information on saving to help you climb the property faster, read our guide on how to save for a mortgage deposit.
When is the Best Time of Year to Buy a House?
The most popular time to buy a home is usually spring and early autumn, whereas summer and winter are usually quieter times. The highest housing stock availability tends to be in the spring, and sales go through faster as people want to complete before summer starts.
In comparison, the number of houses available will normally drop at the end of the year. This is because homeowners like to be settled over the winter. And due to businesses closing over the Christmas period, it can take much longer to process house sales.
Alternatively, if you’re planning to sell your home, selling during summer or winter can be best for maximising value. Even though it’s best to buy in spring and autumn, the lack of available house during the summer and winter can make your house stand out more, making it more likely to sell for the asking price or more.
What Time of Year are House Prices at their Lowest?
House prices change constantly, so, unfortunately, there isn’t a time of year when you’re guaranteed to bag yourself a bargain. The seller’s circumstances, the market as a whole, and your buying position will all influence the price of your new home.
If someone is trying to sell their home due to financial reasons, is planning to relocate, or has separated from a spouse, then they may be more lenient on their asking price. If you’re a cash buyer or you have no chain – when you don’t have a property to sell before you buy your next one –, a seller could be more interested in your offer as the sale is more likely to process faster. It could be completed as quickly as 30 days!
You should also consider looking at developments where new builds are finished but not sold. Once a house has been built, the developers will want to capitalise on their investment so they can fund their next project. This means they may be prepared to accept a more reasonable offer on unsold homes.
When is the Best Time for First-Time Buyers?
Due to the unique combination of increasing income, appreciating value, and depreciating debt that helps keep up with rising costs, property is considered a solid hedge against inflation.
This isn’t good for homebuyers as it can drive up property prices and increase mortgage costs. If you’re in a position to do so, you should do what you can to get yourself on the property ladder sooner rather than later.
By doing so, you will be able to benefit from the lowest interest rates that are available for borrowing. However, buyers will need often need a 20% deposit to take advantage of the very best rates. If you don’t have this kind of money saved up, there are government schemes available that give first-time buyers the financial support they need to be able to afford their first home. These include:
- Help to Buy — An equity loan where the government lends first-time buyers in England money to buy a newly built home, which gets paid back through monthly payments.
- Shared Ownership — Where you purchase a share of a property and pay an affordable rent on the rest with initial shares available from 50% up to 75% (or less).
If you’re a first-time buyer and you would like to expand your knowledge of the housing market, our ultimate guide for first-time buyers in the UK can help you.
What is the Best Age to Buy a House?
According to Halifax, the average age for people to start joining the property ladder has increased to over 30 in every region of the country (as of January 2022). The rising house prices mean that first-time buyers need to save for longer before they have a large enough deposit to purchase their own home.
This doesn’t mean that you have to be over 30 to buy a home. If you have the money for a deposit, you can buy a house at any age. However, you typically do need to have a credit history to get a mortgage – and to receive the best rates, it needs to be good.
So if you’re only 18 and you have no credit history, the likelihood of being accepted for a mortgage is lower (although not impossible). You can learn more about the types of mortgages and which one is best for you here.
In the past, you weren’t able to get a mortgage past the age of 55, but now that people are living longer, lenders are more accepting of older borrowers. At the end of the day, people who are living off of their pension are considered to be much more reliable than those who are working because a pension is a steadier stream of income.
Is it Good to Buy a House During a Recession?
Most people consider a recession a bad time to buy a home because wages are lower and more people find themselves unemployed. However, during this time property prices tend to drop too, so you will get more for your money.
If you look at the percentage change of UK house prices over time, you’ll be able to see that house prices have, and continue, to go up. This makes property a fantastic long-term investment, so buying a house during a recession could be a great idea — as long as you can afford to do so and can get a good deal.
Is it Good to Buy a House in 2022?
The Express and the property industry predicts that 2022 will be a good year for buyers as they’re likely to get a fair price on a property. The levelling out of house prices is due to the market steadying after the end of the stamp duty holiday — when buyers didn’t need to pay stamp duty on properties up to £500k — which came into force during the pandemic and ended on June 21st 2021.
Lloyds Banking Group states that average mortgage rates have hit an all-time low and have stayed down at the start of 2022, which is great because you could save hundreds of pounds over a year of mortgage payments.
Property experts have also disclosed to The Guardian that house price growth is set to slow in 2022, as borrowing costs increase and household budgets continue to strain under the rising costs.
The UK is struggling to keep up with the increasing demand for properties, but current prices are steady and property experts believe that this will benefit buyers in 2022.
Has COVID-19 Affected Home-Buying Patterns?
There has been a change in homebuyers’ priorities since the COVID-19 pandemic hit. Many are now seeking a home office space, access to an open green space, and a private garden.
As people have experienced what it’s like to spend most of their time in their homes, choosing the right place to live has become more significant than ever, which has been reflected in people’s buying patterns.
Find Expert Mortgage Advisors with MyLocalMortgage
With over 2,000 experienced mortgage advisors to choose from, covering every area of the UK and all aspects of property finance, MyLocalMortgage is the simple way to receive expert mortgage advice tailored to your plans and circumstances.
