Is now the time to buy or should you wait?
22nd January 2009
A message from our Managing Director...
I’ve been asked time after time recently from friends, clients and applicants “Is now the time to buy or should I wait?” My answer is always the same… “It depends on your personal circumstances!”
How do you know when it’s the right time for you to buy a property? One day you think it’s a great opportunity to “bag a bargain”, the next day the press tell you that prices are set to continue dropping for another six months.
Of course, no one has a crystal ball when it comes to forecasting and we wouldn’t be so presumptuous as to suggest that this kind of economic climate is a great time for everyone to purchase… but we do have an opinion and we do see what is happening in the property sphere every day.
Reasons to buy...
1. You are paying rent. It makes much more sense whilst the market is low, to be paying a mortgage (even if you club together with a mate).
2. 75%-90% mortgages (subject to status) are available. If you don't believe me, call Simon Redler, the MD of our Financial Services Company on 020 7328 3280.
3. You are moving up price wise. It is the differential that counts. Say you are moving from a £200,000 home to a £300,000 home and the market has dropped 20%. Now, instead of having to find £100,000 to move up, now you only have to find £80,000.
4. Remember, everyone speculates on the market conditions - nobody can ring a bell when the market is at the bottom.
5. Property is in true terms, a minimum of 20% cheaper than a year ago. This is more than the papers tell us. Does it mean the market is closer to the bottom than people think?
6. Our phones are starting to ring again with developers and investors looking to buy a bargain.
7. Research says that we are far off target on the number of new homes needed in London. See report in link here .
8. More choice on products / homes as there are more available.
9. Interest rates are low and therefore more affordable.
10. Exchange rates are favourable to overseas investors looking to purchase again in the area, which could lead to higher demand and higher prices.
11. It is time to bag a bargain.
12. Properties are a home first, then an investment.
13. Lack of competition for flats means you can buy at a more competitive level.
14. Refurbishment costs are down as builders seek more work.
Reasons not to buy:
1. You are moving side wards or down price-wise and are in no hurry.
2. The market may drop further.
3. You are not secure with your job or earnings and would therefore be foolish to take on a commitment.
4. You only plan to be in your new home for a year or so. With the cost of stamp duty and the state of the market, you should stay where you are.
5. There is so much supply of properties on for people looking to rent as well as sell, that rents could well drop further.
6. Lack of sentiment.
Of course, the choice is yours as to whether you agree that now is a good time to buy. But if you want facts - current property prices in “true terms” then give us a call. We’d be happy to have a chat.
David Pollock
Managing Director
Greene & Co / Urban Spaces
www.greene.co.uk www.urbanspaces.co.uk