With England in the midst of a second lockdown, you might be facing some tricky decisions about selling property.
There’s a pervasive sense of uncertainty about what the future holds, and you may simply assume that this means you should delay sale. However, the truth is that this second lockdown actually presents an ideal time to sell.
Let’s take a look at why.
With bars, restaurants and non-essential shops closed, the economy appears to be losing momentum.
Many people - especially the young - are losing their jobs or receiving a reduced income due to being furloughed from their positions.
The impact of the Covid crisis and the resulting blow to the economy has led many potential sellers to hold fire, thinking that now just isn’t a good time to expect people to want to buy a property. However, due to recent changes in the housing market, you’re in a better position to sell than you might have previously thought.
The housing market is thriving right now, and there is data to prove it. For example, the Bank of England recently reported that mortgage approvals haven’t been this high since 2007 - more than a decade ago.
Demand for properties is booming, creating the opportunity to sell at higher prices. For example, the Nationwide Building Society tells us that October saw price rises of close to 6% - a degree of inflation we haven’t seen in six years.
This means that if you want to get the best possible price for your property, now may be the time to put your house on the market.
But why is this happening?
Understanding the recent rise in demand is crucial to understanding how long this thriving market will last.
Economists explain that this unexpected housing boom isn’t because of any one factor, but rather because of a mix of important changes. Taken together, these shifts boost housing market activity.
The relevant changes include the economic freeze we saw in the Spring lockdown, which is when we’d normally expect to see most house-hunting underway. So, once the spring lockdown ended, there was a surplus of buyers looking for properties, creating a noticeable spike in demand.
In addition, July’s reduction in stamp duty played a crucial role. This is no surprise and is something we’ve seen in the market before. For example, a similar move back in 1988 encouraged a surge in property buying.
And while we’re currently able to get stamp duty cut changes for houses up to £500,000, we can expect to see more and more people choosing to buy new properties.
If you’re thinking about selling, one of the main things you’ll be wondering is how long this window will stay open.
This will help you plan for the future, and get a sense of what method you might want to use to sell your home.
Unfortunately, it’s likely that the current demand will fizzle out fairly quickly - by next Spring at the latest.
The housing market’s outlook remains uncertain, making it wise to consider selling now before circumstances change.
We are likely to see a decline in the next few quarters if there’s a predicted spike in unemployment. And, most importantly, the Stamp Duty returns in Spring. So, it’s smart to take advantage of this period before that return.
Essentially, what we’re seeing right now is a surge in purchases that would have taken place further down the line. So, the inevitable result is a reduction in demand from Spring 2021 onwards.