Property has long been a popular way for investors in the UK to hold and grow equity. In previous decades the appeal of purchasing a property has meant overseas investors have become even more prevalent.
The immediate knock-on effects have been felt in London, with homes sat empty with their only purpose to accrue value over time.
The effects of overseas investors are just one of the many factors that will play on the UK housing market in 2022. For those looking to move or buy a property for the first time the array of factors that are hindering their moves can seem endless.
If you’re looking to buy a property in the UK what can you expect, and crucially how can you avoid overpaying?
Lean on experts
Unless you are a seasoned veteran in the property sector it’s likely that help when buying will be crucial. In a time where British house prices are more volatile than ever, turning to those who are experienced in the market in their day-to-day roles is vital.
For many, selecting an ‘expert’ means finding an estate agent that can assist in the selling of your property, and if you employ them to sell it’s highly likely you can sway some free advice from them with regards to new properties you are exploring.
Furthermore for those looking to upgrade or get a mortgage for the first time then a dedicated mortgage advisor is a great way to garner unobjective advice.
As with any expert, it’s vital to ensure that the advice you’re receiving is correct, in the UK many have professional indemnity insurance for estate agents or the equivalent for professions such as letting agents.
In the event they are to give you incorrect advice, such as underselling your property based on the market at the time, then you may be able to use their cover to claim back damages.
Accept that there is never a ‘perfect’ time to buy or sell
While there is plenty of foresight to be taken before you make the decision to buy or sell a home, it’s vital to accept this will only get you so far.
In 2020 and 2021 the UK house price continued to rise as the months went one, the use of the Stamp Duty holiday to keep the market moving during COVID only added uncertainty on the best time to move or buy.
Even now the scheme has ended the average house price in the UK continues to rise, and experts believe in 2022 house prices will increase a further 5%. The rapid growth means that if you are planning to buy next year it may be more effective to accept that you can never really beat the market.
For first-time buyers, patience is a virtue, and waiting for the post COVID stability of the housing market would be better. The nature of buying a home without having one to sell means you are more likely to be able to jump when the market is where you need it to be.
Ensure you understand all the costs and your potential restrictions
If 2022 is your year to move then it’s best to understand what you can afford before you even start browsing. Mortgage lenders have even more specific criteria to outline what they will loan you, and falling into a category such as being self-employed can mean your opportunities are limited.
Furthermore, while borrowing has become easier when compared to the original peak of COVID 19 many providers are still capping LVT at around 80-85%.
Again first-time buyers will likely have a much easier time finding a new home when compared to current homeowners. The added Stamp Duty is not applied on most house sales for first-time buyers, which is a key cost to consider when buying a home. Rates vary depending on your purchase price and area.
Among other costs to consider as part of your final house price include the estate agent’s commission and the cost of professional removals.
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