Property prices in London are falling, but economic uncertainty and a higher cost of living has resulted in thousands of people still feeling worried that it’s too risky to buy a house. So when is the right time? Is it best to bite the bullet and go for it while you can, or lie low and wait until the political climate is calmer?
According to the Office for National Statistics (ONS) the average London home is worth £5,000 less than it was this time last year. This signals a much welcome change for house hunters in the capital, which has been a notoriously difficult market for the average buyer to enter.
Statistics show that the average property price in the capital is £471,986. With prices dropping by around 1%, buyers can save around £4,720 on their purchases. Pimlico estate agent, Andrew Reeves said, “Drops of around 1% might not sound like a lot but is indicative of a wider trend that will be welcome to struggling buyers.”
Conversely, rental prices are still high. The average rented property in the capital is £1,569 a month, which adds up to nearly £19,000 year. With figures like this, renting is clearly no longer a cheap option and the average tenant will end up paying more to live in a home that someone else owns.
Robert Holmes said, “It’s very difficult for first time buyers to work out the best thing to do. Many people are thinking it’s better to sit and wait for the perfect time to buy, but that perfect time doesn’t always come.”
One tactic that experts are suggesting is to negotiate a discount on the sale. It pays to ask the right questions when you’re on a viewing, so you can obtain clues about whether there’s any wriggle room on the asking price. If sellers have been waiting a while or are in a hurry to complete, you could well get a great deal.
Buying a home is still a dream that seems unattainable for many younger people, especially those who don’t have support from parents who are able to contribute a healthy deposit. Both rents and property prices have grown much more quickly than wages, so it’s hardly surprising that so many millennials are still living at home with their parents.
“On the plus side, mortgage rates are relatively low, so those who do have a deposit and good credit should have plenty of options available to them” said Plaza Estates.
So the question “to buy or not to buy?” isn’t an easy one to answer. Particularly in London, it’s still difficult for the average person to get a foot on the ladder. But with prices starting to drop and decent mortgage rates, things are starting to look a little easier.
