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How will the coronavirus affect house prices?
The housing market is already declining, and is going to continue to do so at an alarming rate over the coming months. Homeowners looking to sell their house in the next year or so should sell now, to avoid the worst of the damage.
Whether you were considering selling your home, were looking at buying a house or are simply a homeowner concerned about the current climate, chances are you’ve been looking into the possible effects that the coronavirus could have on your house. In such unprecedented times, it’s hard to say precisely what consequences this virus may have. Thankfully, with some research, we can give you a good idea of what we expect in the coming months, to try and put your mind at ease.
What was the property market like before the lockdown?
Since the general election in December, the property market was looking very positive, with potential buyers and sellers. They were waiting until after Brexit and then flooded the market, making for a very busy January. As expected, however, in the current crisis, this activity has come to a near stand-still. With the country under lockdown, buyers and sellers in the property market have struggled. Estate agents have closed, and homeowners have been told to pause purchases or sales until such a time that the lockdown measures are lifted. With no confirmation when this will be, understandably many eager homeowners are concerned, especially those who were relying on a purchase or a sale. This has led to difficulty for some homeowners, who may be looking for an alternative.
Are house prices going to drop?
While no-one can say just how dramatically the property prices will drop, it is clear to see that there is going to be a substantial decline in the market in the coming months. With the country under lockdown and the economy suffering, the property sector will be affected in the same way and leave homeowners with a drop in their house’s value. Preparing for this drop can make a big difference for homeowners that were planning to sell in the coming months, as pushing forwards and selling now means that they do not suffer as much as they would trying to sell in six months’ time.
With the decline in the economy and the potential threat of a recession facing the UK, it’s fair to assume that the property market will be hit hard, leaving house prices lower than they have been in a long and causing panic for those who wanted to sell but will struggle to get the asking price that they need, especially if the reason for sale is financially influenced. We help homeowners get the best price for their home under the current financial climate. As cash buyers, we hold significant funds that allow us to buy your property quickly and easily, meaning less hassle for you and the funds from your sale in your account in as little as five days.
Are house viewings still taking place?
This pandemic has meant that every sector of the country has had to adapt in ways we would never have expected, and the property market is no different. Estate agents and other property companies have revolutionised they work, creating a virtual way to view a house. From video tours to interactive imaging to let you explore the property, you’re still able to view properties and have your house viewed with no risk and worry. Some sales are facing delays when it comes to the conveyancing side, but you are still able to hold and (virtually) attend viewings.
Currently, mortgage applications are still open, but the application process has changed, and the terms are somewhat harder to achieve. Usually, you would need to save between 5-20% of the house value for your mortgage approval, but this is increasing, with some lenders now requesting 50% of the purchase price as a deposit. This is, of course, incredibly high and not feasible for most people. However, with interest rates dropping as low as they have ever been, those able to take advantage of that are in a stable position.
I applied for a mortgage before the lockdown, will the agreement still stand?
Most lenders have put a pause on any current applications, to delay until the end of the lockdown when moving home will be more relaxed. If you’ve applied for a mortgage already, you should contact the lender and ask them what they are doing in regards to ongoing applications. Most likely, they will have frozen the process, meaning it is still valid and will continue when the lockdown is over. You should contact your mortgage lender for confirmation, though, as this can vary across different lenders.
Should I sell my house now?
If you were planning to sell your house over the next six months to a year, selling now could put you in a better position. No-one can guarantee what the outcome of this pandemic will be on the housing market, but all signs point to a decline in the market and a drop in prices. While selling your house now may be a harder process than it was pre-lockdown, it is still achievable. Due to the situation, getting the full value of your house may already prove quite difficult, but this is likely to exacerbate over the next six months, meaning more of a drop. Deciding to sell now could mean you avoid the decline that many are expecting, even if you do sell for a lower price now. Realistically, this price will be dramatically lower in the coming months, so getting ahead of the game is what many homeowners are choosing to do to make the best of the situation at hand.
If you’ve been thinking about selling your home, get in contact with us today. We can provide you with a free consultation. We buy any home in as little as 7 days, or timescales to suit you. Head to our website for more information.