Buying or selling a home after the coronavirus: six steps you can take throughout the lockdown
The property market might be on hold, but now is a superb time for you to lay the groundwork for moving home later this season.
Here, we’ve come up with our top six tips on what movers can do to get in front of the game during the lockdown, from having your finances prepared to preparing your house for sale.
1) Don’t get carried away by house prices
It’s hard to say exactly what’s going to happen to house prices in the short term, the answer message is not to panic.
As the amount of sales drops, house price data will become more volatile – that might lead to some scary headlines about prices crashing.
Try not to pay too much attention to these. It’s true that the property market dips in times of uncertainty, however in the medium and long-term it tends to make a complete recovery.
Indeed, the estate agency Knight Frank has predicted that prices could fall by 3% this year, but then bounce back by 5% in 2021.
While it’s hard to determine how long house prices might be affected by coronavirus, it’s far more likely we’ll see single-digit drops like those above, rather than a full-scale crash.
2) Get your finances in order
If you’re thinking of getting a home loan later this year, now's a great time to provide your money a spring clean and check things are current in your credit report.
Take a glance at all your household bills, from your phone bill for your car insurance, and assess whether you may earn savings.
Perhaps you’ve arrived at the end of an introductory term and reverted onto better pay, or a policy has auto-renewed without you noticing.
A full assessment of the outgoings could save you lots of money, that could perhaps boost your deposit a bit more or help pay for many from the costs of moving.
By analysing your credit score, you can aquire a full look at any debts that you’re paying off, as well as check whether any errors or out-of-date information have affected your score.
3) Consider your mortgage options
Two base rate cuts, a ban on in-person mortgage valuations and banks facing huge demand from customers has led to the amount of mortgage deals halving within the space of a month.
But despite this, rates on two and five-year fixes remain very low. As shown in the graph below, average rates have fallen steadily in the last Twelve months.
How much can one borrow?
Mortgage offers are generally valid for approximately 6 months, but there’s no need to rush in.
The best prices aren’t disappearing and, when the market springs back to life, lenders is going to be seeking to entice customers with low rates.
Instead, take some time to find out what you might have the ability to borrow. Lenders will normally supply to four-and-a-half times your annual income, although this can differ.
See whether saving a rather bigger deposit could permit you to move down a loan-to-value (LTV) band. For example, rates on 90% LTV mortgages is often as much as 1% less expensive than 95% deals.
When it's about time, consider taking advice on your options from a whole-of-market mortgage broker.
4) Investigate the market
Whether you’ve reduced your property search to a couple streets or a few towns, it’s always useful to get a handle on what’s happening in the market.
You can find out just how much people have spent on homes in a specific street or postcode by using the Land Registry’s ‘price paid’ tool.
It can also be helpful to take a look at what’s been listed on property portals.
Rightmove’s ‘market info’ tab on listings lets you view nearby properties that are under offer or sold, and every Zoopla listing shows when a property was placed on the marketplace, whether it’s been reduced and how much by.
If you’re still deciding between several areas, check out our help guide to finding the right home and compare towns using our area comparison tool.
5) Spruce up your present home
If you’re seeking to sell later this season, you’ll need to get your home in a fit state to entice buyers.
For some, that may mean a declutter and touching up some paintwork, but for others it could mean a much more significant DIY job or obtaining the contractors in (following the lockdown ends, of course).
Try and examine your house impartially and consider whether you’re making the most of the area. Take a look at homes on property portals and discuss what you think works and doesn’t work.
Preparing your home for sale is important, but for now, focus on smaller improvements and don’t spend huge sums of money so that they can add value.
After all, that new bathroom suite might not create a big difference in a sale, and worse still, the buyer may decide it’s not to their taste.
6) Calculate the cost of moving
When you are looking at buying and selling property, there are numerous moving parts – from auctions and conveyancers to surveyors and removal companies – and every one of these have a price.
Take serious amounts of estimate the overall costs of moving home and find out where you might be able to look for a reputable professional who will offer you a great deal.
Knowing which professionals you’re going to use is quite helpful in the event that ideal property appears on the market earlier than you expected.
One of the biggest costs of moving is stamp duty. Use our stamp duty calculator to discover how much you will need to pay.
Which? coronavirus advice
Experts from across Which? happen to be compiling the important thing advice you need to stay safe and ensure you aren't left out of pocket.
- Coronavirus: what it really means for mortgages, savings, charge cards and banking
- Coronavirus: how you can protect yourself
- Coronavirus: how to protect your pensions and investments
- Coronavirus scams: how you can spot them and stop them
You will keep up-to-date with our latest suggestions about the coronavirus outbreak over on our coronavirus news and advice section.