Life
    Money

    Dear James: should I wait until after Brexit to sell my home?

    11 November 2019

    Are you right to hold off taking action? Let me think about that for a momen… NO! You’re not right. Get on with it and do it now before it’s too late!

    Uncertainty is the new certainty. If you think anything will be sorted by a Brexit deal or a general election result, think again. The hope is that uncertainty doesn’t lead to turmoil. So, the sooner you act, the better. The housing market is not driven by headlines in newspapers. Similarly, no one is ever going to sell into an amazing market and get a top price and suddenly as if by magic buy into a soft market where you get the deal of the century. In fact, if you are moving up the housing ladder (to a bigger home, more space, paying more money etc), then a depressed and stagnating market is what you want. Think I am mad? Here are five reasons why this is the BEST time to get on with it.

    1. Limited Supply

    There’s no doubt that the current levels of uncertainty haven’t been matched since the financial crisis of 2008. There is less on the market. It’s a good time to sell. In addition to that, people are beginning to accept that making a house purchase or sale decision is no longer dictated by external conditions but by need. Whilst the realisation that uncertainty is here for the long term, there are a lot of people, like you, who are holding off. The fact that Stamp Duty has become the noose around the neck of the market has further reduced enthusiasm for market movement unless there’s a need. The three “d’s” are almost the only thing driving listings. Death, divorce and debt. But there’s not a lot of debt driven sales given that interest rates are so low. Come the new year, sentiment will probably change and there’s likely to be a spring rush to market whatever happens politically. If your house is presented well and priced appropriately it will sell now. There’s not much choice out there and whilst there may be a reduction in the number of buyers, they are still there.

    2: Uncertainty creates opportunity

    In fact, the worst thing to do in a market is to do what everyone else does. Why? Because you’ll get trampled in the rush! Buying from a motivated seller is much easier and selling to someone who is really focused on what they want or need rather than being bounced into a situation usually leads to a less stressful process. And yes, if you have found the property you want, you may just find you can get a deal at a more favourable price and that will further sweeten any deal.

    3: More time to choose and make up your mind

    Every house or flat I have ever bought has been a decision taken very quickly on inspection. That said, I have usually formulated what I am looking for before taking the plunge. It’s as much as a psychological hurdle to move as it is a physical one. You are about to take one of the biggest financial decisions of your life, to uproot everything you know and to change how and where you live. And to be put into a competitive situation where the actions of others bidding or forcing a decision, could make you take a decision you regret. Or even worse to take a decision NOT to do something. 18 months ago, I made exactly that mistake. I found a house that was sensational. Although a lot of work it could have been an iconic “forever” house but the spectre of Brexit, market uncertainty and a general feeling of unease caused me not to do it. I will regret that decision for a very long time. Do not be that person. Allow your decisions to be taken by what’s right for YOU not the market.

    4: You want the surge after you’ve bought

    A house isn’t just a house or an asset. It’s a home. And if that home isn’t right for you everything else around you will be impacted. Negatively. Getting the right home for you is so important. If you have to pay more because you’ve bought in a dramatic or frothy market it could take longer for the asset to be worth what you paid for it. But to think that the very house or flat you want would be available at just the right time and at just the right price is an awful lot of stars too align. And they probably wouldn’t so don’t allow yourself to be distracted by the “what if’s?”

    5. Make it a long-term move

    Too many people try to play the market rather than do what’s right for them. Take a good hard look at what you are looking for in a house. Given the stamp duty situation people are staying in homes longer because of the real costs of moving. It’s even more important to get it right rather than taking a punt. You can’t just trade out of a bad decision with a rising market to bail you out. We are unlikely to return to those days for some years yet. Do ask yourself: how long do you think you want to live there? Is this a forever house? Is this a family home or something more of a stepping stone? There are all sorts of unavoidable economic uncertainties aside from Brexit which make it wise to invest for the long-term.

    My final advice comes from personal experience. I am in exactly the same position as you. My house is on the market. I have found a house to move to and have exchanged. I may have to take the bridging loan I have set up in order to make this deal happen. Why am I taking such a risk? Because the house I am buying (post the “forever” house debacle) is exactly what I am looking for. It ticks all the boxes. Of course, I am worried about a market falling away but I am a big proponent of finding the house you want to live in rather than simply accepting a compromise. If you get the presentation and pricing right, your house will sell.

    Once you have sold, bought and moved, you’ll get on with your life. In ten years’ time, you’ll probably wonder why you were worried about Brexit or a general election. If you have bought a place you love,  as long as you’ve priced your debt correctly and made contingencies, whether prices go up or down you won’t need to worry. Chances are you’ll be happier. And happiness is something money cannot buy.

    James Max presents the Business Breakfast on TalkRADIO every weekday morning from 5 – 6.30am and is a qualified chartered surveyor.

    @thejamesmax