By Many people want to know whether now is a good time to buy or sell. But, in reality, the answer often has very little to do with the wider market.
Sometimes, whatever is happening to house prices, mortgage rates or buyer demand, you simply need to move. Or it may just make sense for you and your family, or from an investment perspective.
Here are five reasons why the market may not matter as much as you think, and why it can still be a good time to buy or sell, even if you are an investor hoping to make money from property.
#1: How much you need to buy or sell
Are you having a baby, getting divorced, getting married, dealing with debt, or have you sadly lost someone dear to you? If so, you may not have much choice. You may need to buy or sell, whatever the market is doing.
And hard though it may be, over a lifetime of buying and selling property — especially with lower average capital growth since 2005, and particularly for flats compared with houses — it is likely that you may not make money from at least one property during your lifetime.
Sometimes, moving home is the right thing to do, even if it means renting for a while between owning properties.
It can help you move on with your life, reduce stress, and deal with the personal reasons behind needing a different roof over your head.
#2: Are you buying or selling for yourself, or as an investment?
Your reason for buying or selling makes a big difference.
If you are buying or selling for yourself, and your dream property comes up, it may be worth selling your existing home even if it does not make perfect financial sense. This is especially true if you are likely to stay in the new home for a long time.
The key question is: can you afford it, even if things change in the future?
If you are investing, the answer can also be yes. Whether the market is rising or falling, if a property comes up at the right price, you can afford it, you intend to hold it for some time, or you know you can add value, it may still be worth buying now.
But you do need to know your market.
You also need to be sure you can cope with:
- A fall in property values
- Rental voids
- Higher mortgage costs
- Unexpected repairs
- Personal changes in circumstances
Without this, buying now could be a risk rather than a sensible move.
#3: Are you buying your first home, trading up or trading down?
For first-time buyers, getting on the ladder is a big decision. Many worry about buying now and then seeing the market fall.
That is understandable. Nobody wants to buy and then feel they have overpaid.
But if you are trading up, market falls do not always matter as much. Once you are already on the ladder, if the market drops, you may sell for less — but you may also buy for less.
And this can work in your favour.
For example:
- If you lose 10% on the home you sell, you might sell for £200,000 instead of £220,000.
- But if the property you want to buy has also fallen, you may be able to buy a £330,000 home for £300,000.
- So, while you have “lost” £20,000 on your sale, you may spend £30,000 less on your purchase.
If you are trading down, this can work against you. However, many people trading down have lived in their property for many years. For those who bought before 2005, there may be substantial equity in the home.
These gains are typically tax-free, as long as the property has been your only or main residence.
Releasing capital from your home can help support your pension or help children onto the ladder. But it is vital to make sure you can genuinely spare the money and will not need it later in life.
#4: Successful investing can mean buying when the market is falling
For investors, a falling market can sometimes create better opportunities than a rising one.
Investors can buy successfully in falling markets when they are able to move quickly, often with cash, and understand the risks they are taking.
This can include properties where:
- Someone needs to sell quickly
- The property needs a lot of work
- A flat has a short lease
- There is a subsidence issue that can be fixed
- The property can be improved or reconfigured
Even in a rising market, when buyers are desperately outbidding each other, good investors can still make money. But it takes detailed knowledge of the local area and a proper understanding of individual property prices and rents , both past and likely future.
And, it’s worth knowing it may mean checking 150 properties or more before finding the right deal!
#5: What is happening in “the market” may not be relevant to your property
The news is full of stories about property prices and rents, often on a weekly or even daily basis.
But what is happening “generally” does not always apply to every property.
Some homes will sell brilliantly in a good or bad market. Others may take longer to sell and need a keen price, regardless of wider conditions.
Currently, the view is that the market is:
- Average property prices are either stagnant, falling, or rising at less than the “average” 3%+ annual increase
- There are 14% more properties for sale this year than normal over the last decade
- Due to interest rates and mortgages remaining higher than the long-term average expected, buyers in the South, East and London are struggling to afford properties, so demand is subdued
- Some sellers are struggling to accept that their property may not have increased in value over the last five or even ten years, so they are overpricing their homes, which is lengthening the time it takes to sell
For buyers, this can be good news. It could be considered a good time to buy. For most sellers, the headline stats suggest it is not an ideal market. If a property is not priced keenly, it could stay on the market for some time.
According to Richard Donnell from Zoopla, “Almost a third of homes listed since Q2 are still on the market without a price reduction.” So these properties are likely to continue to struggle to sell unless the price is reviewed.
However, there are still areas and properties being snapped up within days of coming to market because they are unique, well-priced or highly desirable.
To learn more about UK property market data across the UK, specific regions and cities across property prices and rental prices, check our dedicated UK Property Market Insights here.
If you want to be part of a dedicated community of landlords, developers and investors for in-depth reports and on-demand webinars, join the digital community for free here.
How do you know whether it is a good time to buy or sell?
The reality is that it is less about the market and more about your personal circumstances.
The decision depends on whether you are:
- Buying or selling for yourself
- Moving because life has changed
- Trading up or trading down
- Buying your first home
- Investing for the long term
- Financially able to cope if the market moves against you
If you can afford to buy, have a clear reason for doing so, and understand the risks, then “the market” may not be the deciding factor.
For investors, the same applies. If the deal works, the numbers stack up, and you can hold for the long term, buying now may still make sense.
What’s your view – is now a good time to buy or sell?
The answer will be different for everyone. For some, waiting may be sensible. For others, moving now could be the right decision — not because the market says so, but because life does.
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