As life slowly gets back on its feet so to has the property market. Agents are back to work, valuations are being conducted, homes are being viewed, offers are being made and sales are starting to go through. Albeit, with safety being put at the forefront. So, the question being asked by both vendors and buyers is “what will the market do now”.
Mortgage rates are still the lowest they have ever been and it is clear to see buyers taking advantage of this. We have seen a huge increase in potential buyers registering their details and asking to speak with our recommended broker to ensure the rate they receive really is the best. Mortgage rates can vary daily so it is important to keep informed to ensure you achieve the lowest rate possible.
Having said this, there has been a slight change with regards to the actual lender. Following lockdown, mortgage lenders are only lending on up to 85% of the purchase price, meaning a buyer would have to have a minimum deposit of 15%. Still, we have it on good authority that within the coming weeks most lenders will revert back to a 90% lend. This means first time buyers will be in a perfect position to make a purchase and begin the chain.
We have also spoken to a handful of buyers who have asked whether furlough will affect the amount they can borrow, or whether they can even get a mortgage. Again, this can vary depending on which lender you decide to proceed with. The majority are claiming that, if your current employer can confirm your return to work, they will be happy to proceed. Nevertheless, we strongly advise speaking with a professional broker to get a more in depth, professional opinion.
So what does this all mean for sellers.
NatWest recently released a statement claiming property values to have dropped by 1.7% from last month – the largest monthly fall in 11 years. Whether this is the case or not, what they fail to mention is that the Office for National Statistics claimed that at the beginning of March, London’s average house price had increased by a huge 4.7% over the year. This is the largest 12 month growth London had seen since 2016. So regardless of what people say, the average house price within London is continuing to rise year on year and now is as good as any to sell!
At Woodcote Estate Agents we have seen a vast increase in the number of calls from sellers since the lockdown eased two week ago. I think this shows that people are motivated to sell, and I suspect that there is a further backlog of houses who have postponed their sale due to the lockdown. So, just based on the last couple of weeks, I can only imagine that as life begins to reach some sort of normality again, the next few months may be some of the best months that the property industry has seen since the early 2010’s. I appreciate that this is a big shout, so if I am wrong then forgive me, but let it be known that I called it in May.
Written By – Luke Porter, Director of Woodcote Estate Agents