Since the lifting of the property market lockdown in May, the upturn in market activity has been quite remarkable. Since launching my property finding business in 2011, I have never received as many enquiries from people wanting to find their next property in what is traditionally the quietest period for the property market.
The first property which I viewed on behalf of clients received five offers above the asking price on the very first day of viewings, and this has been repeated elsewhere. All agents that I have dealt with since then have been overwhelmed with new property enquiries.
Further, the reasons for people wanting to move seem to have changed dramatically.
My clients’ new priorities are as follows:
I must have an office to allow me to work from home.
Outside space for me and my family is essential.
We must have access to local shops and the countryside.
I now only want to travel to my office in London one day per week.
I want to downsize and retire.
And perhaps more surprisingly:
I want to move to the UK.
In the last month, I have received several new enquiries from South Africa, Australia, Florida, Canada, New York, Chicago, and Saudi Arabia.
There is no doubt that people do want to move as soon as possible. There is also no doubt that Oxfordshire and the Cotswolds are more popular than ever before because of access to beautiful countryside, established towns, excellent education, and the many transport options to London.
But is now the right time to move? Is now the right time to buy a house? There are contradictory messages throughout the media.
On the positive side, in August Rightmove reported that July was its busiest month for sales in more than 10 years, with sales up 38% on the previous year. The increase on their portal in sales of the most expensive of homes was up by 59%. Analysts believe that this activity is being driven by buyers who have brought forward their plans to move by months or even years whilst mortgage rates are at record lows and there are also savings to be made on stamp duty.
On the other side of the coin. The economy is now clearly already in recession, with possibly worse to come with further redundancies when furlough is withdrawn. Many people in higher paid office-based jobs who can work from home will be less affected than people in the hospitality sector, for example, so a situation could arise whereby the top end of the market is less impacted than the lower end. Nobody really knows, despite the speculation.
The stamp duty holiday has certainly created a bubble with prices now rising in some locations, but this may burst in March 2021 when the stamp duty break is withdrawn. The availability of mortgages is also now declining by the day, with fewer lenders willing to accept 5% or 10% deposits, and interest rates are very likely to rise.
So, after considering the positives and potential negatives, is now a good time to move?
This is the question I am being asked by many of my clients, and my answer really does vary by individual. These are the things I usually ask them:
Why do you want to move? What has changed in your life?
Are you sure you would like to live in the location that you have chosen? Have you lived there before?
For people seeking a move from the city, have you ever lived in the countryside before?
How long do you think it will be before you want to move again?
For questions 1, 2 and 3, if they are unsure, I will often suggest that they ‘try before they buy’ and find a property to rent in their chosen location – to really understand whether this is the place they would like to live. Several of my clients are now choosing this option, which can also put them in an excellent position to buy when the right property comes along.
If the answer to question 4 is under five years, now is possibly not the time to buy, especially if you’re considering buying a second home or holiday property.
The average price for a detached house in Oxfordshire is currently £620,000. Currently, for a normal buyer stamp duty payable on such a property would be £6,000 pounds. This will rise to £21,000 in April 2021. If buying the same property as a second home, the current stamp duty rate is £24,600 and this will rise to £39,600.
If you wish to sell within five years, and anticipate a substantial increase in value, this is not going to be very likely unless you purchase a property which requires substantial improvement. It is doubtful the property market will increase dramatically over this period and taking into account the likely recession, total cost of moving, legal fees, estate agent fees and taxation, a profit on a property bought today is highly unlikely within the next five years.
That said, if you are thinking of moving home now, the short-term return on your investment isn’t always the main criteria. Your next purchase could provide the change of lifestyle to which you now aspire. It could be the perfect home for your retirement, for your family, for the rest of your life. And if you find such a property, with the right advice from your property advisor and solicitor, there is currently no need to delay your purchase at all.
To find out more, please visit county-homesearch.com