Is now a good time to buy a property?

It's easy to think that with the 14th interest rate rise since December 2021, now is simply not the time to be buying a property, when in fact the opposite is possibly true.

If we cast our minds back to the dark days of post lockdown, the one glimmering light for homebuyers at the time was the Government's decision to abolish the stamp duty threshold below 500k for a period of time, which in real terms was a saving of £15,000, even for those buying at higher levels.

At the time I was a Branch Director in Dulwich, and within days it felt like someone had cloned thousands of buyers and pointed them in my direction! Now, it wasn’t just the stamp duty holiday that was fuelling this, as lock down had made us re-evaluate our homes (and our lives) and the quietly growing pent up demand since Brexit was starting to bubble up, but it was something I had only seen twice in my 25-year career.

Even though I had more people selling in a postcode where most people wanted to remain,  the lockdown, the small gardens and working from home had meant that they no longer needed to be this close to London, so they came to the market. The buyers were pretty much 10 deep for every home, in fact the properties didn’t even need to go online, it was like the Apple Store a day before the release of their latest iteration.

Here they were, buyers armed with their £15k voucher (and low mortgage rates) and they were not afraid to spend it!

So what am I getting at? Well, someone far cleverer than me did some research into the London market prices during that period, and estimated that on average houses cost £53,000 more during that period, purely due to the demand. Ouch!

As humans we are a bit like sheep, we follow each other, there is a safety in numbers and who wants to be buying when their friends aren’t? That would be crazy right?

Well, it wouldn’t. And here's why. There is more choice, there is not a feeding frenzy as soon as something hits Rightmove, you don’t get drawn into a ‘best and final’ scenario where its more fomo than anything else and you will actually pay the price that you wanted to. Now that doesn’t sound too bad, does it?

Ok I hear you, the interest rates are high (for what we have been used to) and that can be scary, but they aren’t for life, it might just be for 2 years on a fixed and with most of the long term forecasts pointed downwards, it might be a small price to pay for the dream house, not renting and not offering so much just to beat out the Joneses.

The key to this is always thinking long term, not what it might be worth next year. If you can afford it, buy it, as in 5 year's time you could have paid down 5 years of the debt, have 5 years of making it your own and 5 years of memories , and you'll be glad you did.

Good luck.