There are a few things to think about before you start scrolling through the property listings.
Whether it’s your personal or professional situation, the time of year, or the state of the economy - there’s more to buying a home than asking, “can I get a mortgage?” (although that’s important, too).
A few things can affect the availability and price of properties. Some of them are outside your control, and others aren’t. Knowing the stuff that’s going to have an impact on your property search can give you a better chance of finding the right home for you.
Let’s explore these in a little more detail.
Is now a good time to buy a house, personally and professionally?
The best time to buy a house is different for everyone. It has a lot to do with your personal and professional circumstances along with your plans for the future.
For starters, moving is widely considered one of life’s most stressful events. That’s why some people try to avoid buying if they’re already busy with significant events such as planning a wedding or getting ready for a new baby.
On the other hand, you might want to buy a new home because you’re getting married or growing your family. If this is the case, you need to consider whether you can juggle the extra time, cost and (unfortunately) stress involved in house hunting on top of your already packed schedule.
And speaking of cost, when you apply for a mortgage, you’ll have to prove you’re financially stable and can afford the repayments. This means that if you’ve recently changed jobs, you might need to wait until your probationary period is over before you can get a mortgage.
If you’re personally (and professionally) ready to buy and you want to know what sort of place you can afford, we’ve got you covered. Use our mortgage calculator to get an idea of what you could borrow and what sort of property price to start looking at.
When is the best time of year to buy a house?
The best time of year to buy a house is when competition is lower. This tends to be during the summer holidays when people are away, or in the lead up to Christmas when people are busier than usual.
Less demand for properties at these times means there might be less competition and even lower property prices. The flip side is that sellers may hold off on putting their properties on the market in quieter months because of the lower demand so there might be fewer places to choose from.
If you want a wider choice of properties, bear in mind that the property market is seasonal, with peaks and valleys along the way.
- Spring: Generally, springtime sees the availability of properties skyrocket because blooming gardens and better weather help make selling and moving a bit easier.
- Summer: When summertime rolls around, things get a little quieter again because of the summer holidays, especially in July and August.
- Autumn: Competition tends to heat up again around this time of year as prospective buyers return to the market.
- Winter: With the weather getting colder and the nights darker, the market slows again around November. December is particularly quiet as most people are preoccupied with the festivities and very few people want to move over Christmas.
When is the best time to buy a house for a good deal?
Like any other market, the housing market is affected by supply and demand. House prices don’t just keep rising throughout the year – they rise and fall as supply or demand increases or decreases.
So, when’s the best time to nab yourself a bargain?
- Just after New Year: During January and February, house prices are usually at their lowest. Sellers might be looking for a quick sale (maybe moving house was their New Year’s resolution), and that means there’s often room for negotiation.
- During the summer: When your rival buyers are sunning themselves, you can take advantage of the housing market’s price stabilisation during the summer months. The lower demand means sellers are often willing to accept a lower offer. You’ve also got less chance of getting gazumped.
If you want to avoid a potential bidding war or overpaying for a property, maybe steer clear of house hunting in spring and autumn if you can. House prices tend to peak at these times.
When is the best time to buy a house?
Put simply, the best time to buy a home is when there are lots of sellers and very few competing buyers - in other words, when supply outweighs demand.
So, to know if now is a good time to make your next move, it’s handy to understand the current state of the property market.
The availability of houses is influenced by various factors, both on the demand side (buyers) and the supply side (sellers). This is generally what decides whether house prices are high or low.
On the demand-side
- The economy: Demand for housing tends to rise in line with income. If the economy is strong and salaries are on the up, people can spend more on buying a new house. And more competition will inevitably push prices up.
- Interest rates: Low interest rates mean lower mortgage payments. High interest rates mean higher mortgage payments. A long period of low interest rates will increase demand for housing because mortgages are more affordable.
- Mortgage availability: Following the credit crunch in 2007, mortgage lenders tightened their criteria for lending, which meant that buyers needed a bigger deposit to buy a house. Mortgages were harder to come by, and demand for homes fell.
Over the years, the lenders’ stance has softened again. And following the COVID-19 outbreak, we saw a return of 95% mortgages (backed by the government mortgage guarantee scheme), meaning that many buyers could get a mortgage once they had saved a 5% deposit.
As a rule, any increase in mortgage availability will result in more demand for houses.
- Buyer confidence: If buyers are worried about the economy, interest rates, mortgage availability, or unemployment, they’ll be more reluctant to sell or buy, resulting in lower demand.
On the supply-side
On the supply side, things are more clear cut:
- A shortage of supply tends to push prices up and means that houses sell faster.
- An excess of supply makes prices fall and means that homes remain on the market for longer.
What else do you need to know when buying a house?
If you’re looking to time your property search and purchase to get the best deal, it’s a good idea to look out for initiatives designed to boost the property market.
The 2020-21 Stamp Duty holiday was a great example of this. The government adjusted Stamp Duty rates across the UK in response to the COVID-19 pandemic to help house buyers save money.
Habito flags these kind of initiatives and helps make the house buying process easier, whenever you choose to buy. Get started here.