A buyers Market, not a sellers…

It’s no secret that Covid-19 has had a devastating impact on the entire world.

Millions have lost their jobs. Off of the back of this, many will have to take payment holidays on their mortgages, some may eventually fall behind on mortgage payments and some may even lose their homes due to repossession. 

What does this mean for the market?

I’m going to focus on 2 things today.

  1. It will be a buyers market, not a sellers 
  2. Lenders will have to recover a lot of unpaid debt and be a lot more frugal with who they lend to

What does this mean for you? 

The person with a home to sell…

  • Now is the time! Sell as soon as possible and sit on the funds. Move in with family, think about short term renting and sit on the proceeds of the sale as in a few months, you will be able to buy a bigger house for a lot less.
  • Fast forward a few months… If you take too long to take the leap to put your property up for sale, you may need to take an Offer much less than what you wished for.

Are you in a chain? There’ll be more about what can do next week… 

 The person with a home to buy…

  • Hold your horses. There are going to be many houses to choose from and many people desperate to sell them so this may work in your favour when it comes to negotiating on price. 
  • You may need to front more deposit than you may have initially planned due to Mortgage products being quite unstable. 90% Mortgages which require a 10% deposit have been pulled and reintroduced week by week. Lenders may also be a lot more picky with who they lend to, request much more information and be much quicker to decline applicants who don’t fit within their risk appetite 

Key take aways

Home Sellers

  • The time is now!

Home Buyers

  • Be patient. Fix your credit & save save save!

All information on my blog is opinion driven based on market trends, statistics and forecasts regarding the current situation. 

*Photo Source https://www.standard.co.uk/news/estate-agents-face-ban-on-for-sale-signs-6781275.html

Financial Hack: How long would you be able to pay your bills for if you were to lose your job tomorrow? Build your emergency fund, Thailand can wait.

At the beginning of 2020 my husband and I decided to house hunt. We bought our apartment 4 years ago, renovated and thought it was a good time to upsize.

We had a budget, we knew the area we wanted to settle down in and knew that our next move would be for the long term. 

Ideally we wanted a project. Something that was nice enough to move in to straight away, however somewhere that had room for a back extension and loft conversion.

Deal breaker. He needs his space – games room and I need mine, an office.

We made 3 offers on 3 separate properties. 2 Offers were accepted and then BAM Covid-19 triggers a lockdown.

This was a bitter sweet situation as we were given time to truly analyse and think about what we were spearheading in to.

We are living in uncertain times and it is said that it will be a while before life is truly back to normal and in many ways, we’re going to have to accept a new normal.   

Why I gave up my 4 Bedroom Detached House hunt and decided to stay in my 2 Bedroom Apartment a few more years…

After a self analysis of our finances and various eventualities we decided to remain put.

In our current state we knew that if one of us were to lose our jobs, the other could pay the bills 3x over before it became a strain. 

We knew that if both of us lost our jobs, we had enough savings to carry us over for a few months paying the bills whilst we hunted for new jobs.

If we were to upsize and take on a project this wouldn’t necessary be the case.

We’d essentially be taking on much higher outgoings because I wanted a shiny new house and project to get my paws in to – a want, not a need. 

The take away from this experience is to stay where you are until you outgrow your home and are bursting out of the seams. Or until you can financially make the move without any strain, taking all eventualities in to consideration. No one knows what tomorrow holds.

Keep those outgoings low.

Save. Save. Save.

Save. Save. Save and when it is time to upsize, you can do so effortlessly.

There’s a time to save, time to build and a time to enjoy what you’ve built. 

Tip: You should have enough savings to carry you through 3 months of a rough period. These savings will pay your Mortgage, utility bills and basic essential costs of living (travel, food etc.)

Why?
Theres an average of about a 3 month period from being made redundant to securing a new job and receiving your first “normal” pay cheque.

Build your emergency fund, Thailand can wait.