Is now the right time to sell?

The extension of the Stamp Duty Holiday that is now ending on 30 June has certainly ensured that the UK property market has remained extremely buoyant. The imbalance between supply and demand has seen property prices soar in many areas and it has been a very strong sellers’ market. According to Which? In March 2021, 16% of properties were sold for more than their asking price. Certainly if you are thinking of moving, it is very tempting, but is now the right time to sell?

The Stamp Duty Holiday has certainly increased demand and many buyers have been paying more than the asking price to take advantage of the tax break. House prices have increased on average by 8% in England, Scotland and Wales, but by a smaller percentage in Northern Ireland. The Halifax reported that house prices in April were the highest they have been in five years and there was an average of 13 buyers for every property for sale. Many buyers have seen the Stamp Duty Holiday as the perfect opportunity to climb the property ladder and data from the Land Registry shows that the percentage price increase in the price of much sought after detached properties has been greater still.

What other factors are encouraging house buyers?

Without a doubt, the Chancellor’s Stamp Duty Holiday has done wonders for the housing market! The Land Registry recorded that property prices rose by an average of 10% in March – which is traditionally the best month to sell property.  HMRC (HM Revenue & Customs) recorded 190,980 property sales in March 2021 and the average property price was £256, 405. The Stamp Duty Holiday ends on 30 June 2021, but the Chancellor has announced that on that day, the zero-rate band will start at £250,000 – double the normal level – and this incentive will continue until 30 September 2021.

The new 95% mortgage guarantee scheme

The mortgage market is much easier now with good fixed rate mortgages, which are particularly good if you can pay a sizeable deposit. The new 95% mortgage guarantee scheme was launched on 19 April and will run until the end of 2022. This scheme can be used to buy any property costing up to £600,000 and is not restricted to either first-time buyers or new builds like the government’s Help To Buy scheme. The mortgage guarantee scheme means that house buyers can secure a mortgage on a property if they can put down a deposit of 5% of its value. For example, for a property costing  £200,000, the amount needed for the deposit would be just £10,000.

The government has also extended the furlough scheme until the end of September, for those in jobs that have been badly impacted by the pandemic.

Three other government schemes.

The Government has three other schemes which are part of its Affordable Homes Programme and these are all helping people – especially young first time buyers – to get on the property ladder.

The Lifetime ISA is for anyone aged 18- 39 who can save up to £4,000 per annum. The government pays an annual ‘top up’ of 25% – maximum £1,000 – and this money can be used to help buy the person’s first home.

Shared Ownership is a scheme in which buyers can invest in 25- 75% of the property and pay rent on the rest. They do have the option to buy a larger share in the property at a later date.

First Homes Pilot is a scheme aimed at first time buyers, where property prices are discounted by 30% and are also capped at 1.5 times the average price paid by first time buyers in that area.

Will the property market remain upbeat?

There is great optimism that the demand for properties will continue as house buyers compete in sought after areas. The pandemic gave many house owners time to consider whether their home was ideal and with so many people still working from home, many have been able to make the move from an urban to rural location. Rightmove announced in April, that properties are currently taking on average just 45 days to sell – the lowest figure since the start of the pandemic in March 2020. The company has also predicted that although price increases will slow, they will still have risen by a further 4% by the end of the year.

Should I ‘take the plunge’ and sell?

It is well worth considering selling if your property has increased significantly in price since you bought it and there is the chance that you can sell it at a really good price. The most popular type of house – particularly with younger buyers– are those with a private garden, space for a home office (even in the garden shed!) and high speed internet. The most sought after types of houses are three and four bedroom detached properties and the lack of suitable properties will keep prices high.

It is important to do some research before you put your house on the market. If you are planning to downsize or move to a less popular area, you will have no problems, but with fewer properties to choose from and greater demand, you may well find that the cost of your next property could have risen too.

An important consideration as well as selling your home, is buying your next – especially if there is plenty of competition. Many house owners have decided that to eliminate the uncertainty that comes with being in a property chain, the easiest way to take advantage of the market, is to sell their current house quickly and effortlessly to a cash house buying company. The main

advantage is that with the money in your bank account, you know exactly what properties you can afford. Because of the high demand, many estate agents are drawing up lists of buyers who can act quickly, so this puts you in a very strong position for securing the house of your dreams….

 

 

Cash Property Buyers, We Buy Any House

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About the author

Starting his career in Estate Agency, Jeff quickly moved up the ranks to manage his own office for Halifax Property Services. Co-founding Speed Property Buyers in 2008, he has applied this knowledge and overseen rapid expansion of the business.