house prices Residential

Does timing play a role in bagging your perfect property?

Q2 2018

Rising house prices and low mortgage rates have encouraged many people to take the next step up the housing ladder. If you’re flexible about when you buy and sell, then you could take advantage of the seasonality of the housing market to bag your perfect property.

Why are more people on the move?

The number of people moving home reached its highest level since 2007 last year, according to a Lloyds Bank homemovers report. More than 370,000 homeowners moved house in 2017, an increase of 19 per cent since the market low of 2009.

Historically low interest and mortgage rates have certainly been a driving factor. The number of first-time buyers hit its highest level in more than a decade, with plenty of demand for homes that fall within the budget of an individual or couple looking to buy their first home.

For those looking to move up the housing ladder, recent house price increases mean that the first-time buyers of five years ago now have substantial equity in their homes. This, combined with low mortgage rates and the demand for smaller properties, has encouraged many homeowners to step up a rung on the housing ladder.

What’s the best time of year to buy?

Trying to predict the whims of the property market can often feel like gazing into a crystal ball: time-consuming and not particularly accurate. But seasonal fluctuations in property prices and availability are much easier to forecast.

Spring

Spring is the property market’s boom season. As the days get longer and warmer, gardens come to life and there’s a general feeling of optimism among buyers and sellers. If you’re willing to pay top price and fight off the competition, this can be the best time of year for house-hunting.

Viewings are typically highest between March to June, with buyers looking to complete in time for a summer move. As a seller, this can be the best time to put your property on the market if you’re confident of attracting high bids, but if you’re looking to buy and sell, remember what works for you can also work against you.

Summer

The boom season extends into the summer months until the ‘summer slowdown’ in August. This can often be a good time to buy, as people are more focused on summer holidays than finding a new home, so there’s less competition. The downside is that there are likely to be fewer properties on the market and those remaining after the spring selling peak may be less desirable.

Of course, one family’s dream home may be another family’s nightmare, so it’s perfectly possible that your perfect property has been sitting on the market for a good few months by the time August rolls around. In which case, getting in during the summer could be a sure way to seal the deal before the autumn rush.

Autumn

The property market picks up pace in September as people’s thoughts turn to finding a new home to move into before Christmas. This is also the time when parents start looking at schools for the following year. If you’re looking to buy a property in the catchment area for a popular school and you’re not in a hurry, you may have more chance of finding and securing your perfect home by waiting until school places have been decided.

Winter

If you’re hoping to get a cheeky offer accepted on a property, then winter is the best time to bag a bargain. The festivities of December and the financial hangover of January mean that prospective buyers and few and far between and if you’re prepared to move quickly, you may be able to secure your perfect property for less than the asking price.

The downside is that moving over Christmas can be a challenge. Bad weather and skeletal staffing over the holiday period can make moving even more of a headache than usual. The market typically picks up in February and March as people start to look to the year ahead and this is often a time when there are more buyers than sellers.

The impact of policy changes on the housing market

The final thing to consider if you’re looking to buy a property is whether any looming policy changes could affect your chances of securing your new home or the price you pay. Often these will come in at the start of the financial year in April. For example, the changes in stamp duty charges for second homes in 2016 led to a rush of sales in February and March and a 20 per cent drop in average sales for April.

There’s also the question of whether interest rates will rise again. 32 out of 57 economists in a recent poll are forecasting a further rise in the Bank Rate in May which, if it does go ahead, will likely nudge mortgage rates up.