‘From Generation Rent to Generation Buy’
What’s the current state of the market?
As you’ll be aware, the housing market has been on an upward trend for some time. That means house prices have been increasing at a substantial rate.
Before COVID struck, house prices were already high. When the pandemic struck us (and struck us hard), they shot up even further. Throughout 2020 and 2021, average housing index increases were about 10% (give or take) more than 12 months prior. That trend continued through to the first half of 2022, where we’re now seeing the rapid increase slow. In August, prices seem to be dropping slightly. This is due to the increasing cost of living.
So, that’s where we are. I’ve chatted with lots of potential first-time buyers. I know how unattainable the idea of home ownership might feel for you. However, before you give up on it entirely, take the time to evaluate your situation. You might have more options than you think.
What the Government is doing to help
First-time buyers struggle now more than ever to get onto the housing market. The Government has announced a review into overhauling the current mortgage rules. This should allow many more people to put their foot on the first rung of the ladder. As the Prime Minister pointed out, around half of the people currently renting can afford monthly mortgage payments – but only 6% of them are eligible for the mortgage itself.
He’s also quoted as saying, “First-time buyers are trying to hit a continually moving target. By the time they’ve put aside money to secure their mortgage, prices have risen and it’s no longer enough…”
There are some doubts about the Government’s commitment to housing schemes. That said, there’s the potential for significant help for renters wanting to buy.
Reviews are being launched into the following two areas:
- First-Time Buyers: better ways to secure good value finance for a low deposit.
- Right to Buy: 2.5 million people renting from housing associations will have the opportunity to buy their homes.
Should I become a first-time buyer or stay renting?
First of all, there isn’t necessarily anything wrong with renting. It works well for some people, providing flexibility and freedom to move. For people seeking more security and looking to invest in a proven asset, though, buying a home is a great idea.
Although the housing market has slowed down at the moment, homes aren’t a bad investment. Quite the opposite, in fact. As a first-time buyer, now, more than ever, is a great time to buy. The overall trend of housing is that it always rises. We’re an island nation, so somewhere to live will always be in demand.
If homeownership feels like a far-off objective, here are a few things you can do to get ready:
- Start saving towards a deposit. Putting £100 aside each week will give you a pot of over £20,000 in three years’ time.
- Secure a long-term contract for your job.
- Have informal chats with housing professionals (banks, mortgage lenders, estate agents, chartered surveyors)
- Keep an eye on what the Government will do to help over the next year or so.
How does a home survey help first-time buyers?
If you’re ready to start making offers on homes, great. Before exchanging the keys and formally committing to the purchase, we’d recommend getting a home survey.
A home survey involves a professional surveyor closely looking over the property. With an expert eye for common (and rare) problems, they’ll document everything they find. You’ll receive a detailed report of the building’s condition. It’ll include many pages of information, complete with photos and recommendations. As an optional extra, you could also ask the surveyor to estimate repair costs, too.
They’re crucial for the following reasons:
- Get an independent valuation so you don’t overpay
- Know about hidden (and visual) problems
- Get repair cost estimates
- Peace of mind
Home surveys cost a few hundred pounds (depending on the type of survey and property). However, they could save you thousands and thousands in repair costs. Essentially, they’re a form of insurance against your investment. If it finds problems, it’s not necessarily the end of the world. But you might use the information to negotiate a lower price.
Why not contact us at GB Home Surveys?
GB Home Surveys is a reliable provider of home surveys. Our chartered surveyors are all RICS-registered, meaning they’re trusted to get the job done.
If you’re looking at buying a home in the West, South-West or West Midlands of England, or South Wales, we’d be happy to help. Or maybe you aren’t quite ready for a home purchase yet? In that case, we’d still be glad to help. Feel free to reach out to us with any questions you have. We’ll have an informal chat about anything you need to know – completely commitment free, of course.
Why not check out our home survey quote calculator in the meantime?
If you’d like to contact us, use the form below. You’ll find more of our details on our Contact page. We look forward to hearing from you and helping you make the jump to homeownership.
