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HOW LONG WILL THE BUOYANT MARKET LAST?

I am sure you have thought the same over the last week or so, ‘houses seem to be flying off the shelf’.

You are right in your thoughts there are a lot of sold boards currently going up, which illustrates the housing market is strong. However, as the famous saying goes ‘looks can be deceiving’. Before coming with up the assumption all is well with the property market we have to consider the following

  • The market has been basically closed for three months so what percentage of these sales are backlog?
  • As we all know finding a buyer for a property is one thing, getting the transaction completed is another. This has always been the case in the industry, however early indications are the amount of sales that fall through may be higher than normal. The main reason for this is the buyer been unable to obtain a mortgage. There are a considerable amount of buyers who were granted a mortgage in principal pre-lockdown and are now looking to make an offer on a property they desire. Unfortunately, and you can understand why, due to covid-19 lenders have tightened their lending criteria significantly. Because of these unforeseen circumstances a high level of the agreement in principals will no longer qualify. For example, buyers who have a 5% deposit. Pre-Covid 19 if you had a 5% deposit there was a strong chance you would be able to obtain a mortgage subject to a strong credit score. However, now this is basically impossible. This is why if the estate agent selling the property is not on the ball at point of offer the house will be marked as ‘SOLD’ only to be re-listed later down the line.

Although some properties listed as sold will be eventually be relisted due to the reasons detailed above there will still be a level which will complete. With the recent changes in stamp duty experts predict a decent level of sales will continue to be agreed.

However, although the property market maybe buoyant the question is ‘how long is this going to last?’ The government are currently helping a significant number of people with the loss of their incomes due to Covid-19, for example the furlough scheme. But what is going to happen once the government remove the cushion?

Analysts predict there are going to be a significant number of people who are made redundant once the furloughing stops. Therefore, with unemployment rising it goes without saying the amount of people looking to move will decrease which in turn may affect the property market in a negative way.

Due to the point illustrated above If you are looking to sell your property the window of opportunity maybe now.  If you would like a Free Valuation contact us today on 03333 232 199. All our terms are on a no sale no fee basis and we only charge £800 on completion irrespective of value.

 

 

 

 

 

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