We’re paying more for your home as house prices rise the fastest for almost six years

Good news for vendors who are looking for a quick sale. According to Nationwide, UK house prices have seen the sharpest rise in nearly six years, making them 6.5% higher than a year ago. That means, right now, we are paying more to our clients for their homes so that they can move quickly.

The rapid rate in which house prices have risen has been driven by a culmination of factors, including pent up demand from the nationwide lockdown, which subsequently propelled people to seek a change in lifestyle or more space to work from home. In addition, the stamp duty holiday on properties priced up to £500,000 has encouraged many to make a move.

However, housing market activity is likely to slow next year once the stamp duty holiday expires at the end of March and the furlough extension comes to an end. In September, the Centre for Economics and Business Research (CEBR) predicted that there will be a massive slump in UK house prices in 2021, by nearly as much as 14 per cent.

In addition, there are a number of reports saying that basic costs for shopping and bills will go up following Brexit which will impact people’s ability to pay a bigger mortgage, therefore putting the brakes on the moving frenzy we have seen over the last few months.

The house price growth we have seen is simply not sustainable alongside macroeconomic influences such as shrinking economic growth, a possible ‘No Deal’ Brexit and most crucially, rising unemployment.

According to a report in the Independent, historically, rises in unemployment result in falls in house prices.  For example, when unemployment in Britain rose during previous recessions, 1993 and 2008, house prices fell by 20 per cent on both occasions.

In the three months to August this year, the unemployment rate stood at 4.5 per cent. Although the housing market has, so far, appeared to buck against the trend of falling as unemployment rises, the true scale of unemployment is not yet being realised due to the furlough scheme. With huge retail stores such as Debenhams collapsing, unemployment is likely to rise sharply next year.

Savvy home movers will sell now at the height of the market and, if they can, wait to buy and see what happens next year because they may well get more for their money.

If you need to move or want to sell quickly, we are happy to have a no-obligation chat with you about buying your home for cash. We aim to complete transactions within a matter of weeks.

Phone number: 0207 449 9797

Email: info@webuyproperty.com

Problems selling when your property chain collapses

A property chain is when a number of buyers and sellers are linked together because each of their transactions depend on one another. For example, a buyer needs to complete the sale on their current home in order to finance the purchase of their new home.

A chain begins with a buyer who does not need to sell anything, for example, a first time buyer or investor, and ends with someone who is selling but not going on to buy another property, for example, they are moving abroad or selling the home of a relative who has passed away.
A chain is then made up of all the properties being bought and sold in between this, and can involve several properties which must all transact at a similar time so that those involved can move to their new property.

Problems occur when one link in the chain holds up the moving process for everyone, such as when a buyer in the middle of a chain suddenly finds out they cannot get the mortgage they need or perhaps they have to pull out of a sale for personal reasons. This can result in the whole chain breaking down and having to start from the beginning of the process.

In addition to a chain being made up of numerous buyers and sellers, each of these will be working with different estate agents, surveyors, solicitors and mortgage lenders. A smooth moving process relies on all of these parties working to a similar timeframe and with one another.

For some people, a property chain breaking down is not just extremely disappointing but can be disastrous if they are in a position where they have to move by a certain time.
As move closer to the end of the Stamp Duty holiday (on properties up to £500,000) which ends on 31st March 2021, more people are concerned about their transactions falling through, meaning they would have to pay more Stamp Duty.

Most recently, WeBuyProperty stepped in to help a homeowner whose buyer had pulled out at the last minute. The couple had to relocate due to a new job and needed to do so quickly to ensure their child was at her new school for the start of the academic year. They were unable to find a new buyer quickly enough so we purchased the property from them, effectively becoming the end of the chain.

Unfortunately, there is not much you can do if the property chain breaks. In addition to the disappointment, buyers can lose legal fees, surveying costs and their mortgage arrangement. If the transaction has already exchanged, the buyer will also lose their deposit.

If your transaction has slowed and you are concerned there is a chance your chain may break down, speak to your estate agent and get an update as soon as possible. If your chain has already broken and you need to move quickly, we may be able to help with a cash purchase.

Why not get in touch with a member of our team and see how we can help you!

Phone number: 0207 449 9797
Email: info@webuyproperty.com