"Ditch the obsession with the price of a home and focus on your quality of life and affordability"
With Brexit looming, Trump in the White House, and elections in France and Germany, 2017 looks set to be an interesting year for the UK housing market. So what steps can individuals take to make sure they make the right property choices in 2017?
For those looking to buy or sell make the following resolutions:
Remember the market fundamentals: Interest rates are low and the supply of housing looks set to remain restricted. Estimates suggest that between 300,000 and 400,000 homes need to be built every year to keep up with demand. We are currently building half that amount. That's why we are predicting house prices rises of between 2-5% during 2017.
Ditch the obsession with the price of a home and focus on your quality of life and affordability. If you need to up or downsize or move location don't put it off. It looks like interest rates will start to edge up so better to get a new mortgage fixed now than wait for a price drop that might not ever come. A home is something that we live in as opposed to an investment so remember that it can be key to your quality of life.
Viewing it as an investment is all well and good but do you really want to be stuck in a space that doesn't work for you? Low interest rates means things are affordable so take advantage of the situation now.
For those renting keep in mind the following:
The governments changes to stamp duty and the tax regime for landlords means fewer rental properties coming onto the market. This can only lead to one thing, rent increases. We're predicting rises of between 5-10% next year. For those who are happy with where they are renting think about extending your current contract. Best to get you current rent locked in for the longer term.
Finally, for those playing the property game:
We've seen reports in the media of people selling up and moving into rented accommodation hoping that they'll get a better deal if prices soften. Given likely conditions next year we don't think that it's a wise move. If you're in this situation and trying to wait out the market we recommend that your new year resolution is to get moving. The housing supply is still restricted, demand is stable and we simply can't see prices coming down in any major way.
If you then factor in potential interest rate rises and rent increases your costs could be increasing while you wait for price falls that is unlikely to materialise. The gains to be made fixing your mortgage now could end up outweighing any discount on the purchase price you're able to achieve.
