‘Should I sell my Wandsworth, Tooting or Balham house now or wait to see how 2024 pans out?’ is a question we often get asked. There has been much volatility in the housing market over the last few years. Massive demand for properties and house price hikes were followed by rising interest rates and borrowing costs, which have cooled the housing market over recent months.
If you’re thinking of moving house, you have a few decisions to make. Should you sell now in case house prices fall during 2024? What would that mean if you’re looking to buy? And what about mortgage costs? While we understand a lot about the market in southwest London, we don’t have a crystal ball – so we can’t give a simple answer as to whether now is the right time to sell. This will depend very much on your personal circumstances. However, we can examine the factors that will influence your decision.
Data from the Land Registry showed that UK house prices fell by 2.1% in 2023, with the cost-of-living crisis and high mortgage interest rates impacting the market. Sale price decreases have been more prevalent in southern England, with London properties experiencing a 6% annual fall, according to UK House Price Index figures.
January data shows that property prices in London have fallen by 2.2% in the last month, compared to a 1.2% fall across England. It is common for house prices to fluctuate throughout the year, but the annual trend has been positive in recent years before this.
Property experts are predicting that house prices will continue to fall but not at a drastic rate. Rightmove has predicted a 1% drop, while Zoopla is forecasting a 2% drop. However, other predictions suggest that house prices could rise, so there is uncertainty about what will happen in the markets.
Local factors and the time of year you want to sell will also affect house prices throughout 2024. Keeping an eye on what is happening in the housing market and speaking to a local estate agent should help you stay up to date with the latest house market trends.
Suppose you’re deciding whether now is the right time to sell your home. In that case, you need to consider two main things – market conditions and your personal reasons for selling. People have many reasons for moving home – a new job, a relocation, a divorce, the need for space for a growing family, or selling an inherited property – to name just a few. Often, these reasons will outweigh market fluctuations, so consider how important it is for you to move right now.
Remember that the housing market is shifting rapidly, with political and economic changes having a significant effect. Before you decide whether it makes sense to sell, you must do plenty of research, check recent sold prices on Rightmove, Zoopla and the land registry, read the financial pages and have honest conversations with local estate agents
Find out how much properties like yours are selling for and how much you will need to spend if you’re looking to buy. Consider whether the right home for you is available in your price bracket, and whether you can afford the mortgage alongside the other moving costs
You might not have the luxury of flexibility when you sell your house. This can happen if your circumstances mean you need to release home equity, move for work, or following a relationship breakdown. However, if you do have the luxury of choosing when to sell your house, you should sell at the best time of year according to your property type.
If you have a large house suitable for families, make sure you avoid putting it on the market during school holidays when families are away, or parents are busy with childcare. Spring and September/October are good times to sell your house.
The best time to sell will vary depending on the property type, local market, and other factors. Try to avoid selling your house if there is construction work happening nearby that could put potential buyers off. If your property is ideal for a family home, avoid selling during school holidays.
If you are buying and selling a house simultaneously, you will need to consider whether to wait to sell when house prices are higher or lower. If you are purchasing a more expensive house, it is better to buy and sell when house prices are lower, while if you are downsizing, you are better off waiting for house prices to rise. Nevertheless, be mindful that the current market is unpredictable, so you don’t know how long you will be waiting.
In terms of the seasons, yes. At the beginning of the year there are lots of people looking for a fresh start and who will be starting the process of looking for a new home. Spring is the best time of year to find home buyers for your property with March top of the months according to Rightmove. Lighter nights bring out viewers, and people are keen to move before the holiday season kicks in. Summer isn’t a bad time to sell, though August is a slow month. Early autumn is a good time, too, but things slow down in the run-up to Christmas.
The rules are less clear when it comes to seasonal sales than they were before the pandemic. The main thing to remember is that people will always need to move for the personal reasons listed above. So, if moving is the right choice for you, you will find a buyer as long as your home is well-presented and marketed correctly
Suppose you are worried that your house will fall in value leaving you with a larger mortgage than the property is worth. In that case, you might consider selling now, anticipating that home prices will fall substantially. This is an option, but there are a few things to consider. Assuming you have a mortgage of 90% of the purchase price, your home would need to fall by more than 10% for negative equity to kick in. In addition, negative equity is only an issue if you need to sell your home. Prices, especially in London, tend to rise in the long term. If you sell now, you will still need to buy another property with all the associated costs and may find yourself with a higher mortgage rate.
Alternatively, you may wish to rent your house out and wait until prices begin to rise again in future, taking advantage of the hot rental market. Bear in mind that if you do this and look to buy a second place to live in, you must pay the stamp duty surcharge. Find out more about buying a second home in our blog.
You should review the different options before deciding to put your house on the market. If you’d like to move because you need more space, you might want to consider an extension or loft conversion if these are possible. Moving costs can soon add up, and an extension is often the cheaper option.
It also means no upheaval to move areas, no moving costs, solicitors’ fees or any of the hassle that comes with buying a new home and selling a house at the same time.
Mortgage rates are considerably higher than they were a few years ago, and if you are still in a fixed term with a lower interest rate, taking out a new mortgage could mean larger monthly mortgage payments.
You might decide to sell your current home now in case prices fall. There are pros and cons to doing this. If you sell, you are in an excellent position to buy a house when the right home for you comes on the market. If prices do fall this year, you may also benefit from selling at a peak and buying when property is cheaper
However, if you have a fixed-rate mortgage now, you may need to borrow at a higher rate. Also, bear in mind that there is a high demand for rental property. If you need to rent while you look for a place to buy, you will face competition, and landlords may prefer prospective tenants who are happy to sign up for a long lease.
As we’ve explained, the question of whether to sell your home is complex. If you’re mulling over this choice right now, talk to us.
We’d be delighted to give you a current valuation of your property in Wandsworth, Tooting, Balham or elsewhere in southwest London to discuss the pros and cons of selling in today’s market.