Published: 22/09/2021 By Jon Graham
4 ways you can get around this confounding issue to move home
No one could have predicted the impact of the Covid-19 pandemic on the housing market. During the first daunting lockdown of March 2020, pundits were predicting a slide in house prices which would inevitably follow the downturn of the wider economy. Jobs were sure to be lost, and the end of the furlough scheme would signify an impending crash. Or at least, that’s what everyone believed at the time. After all, that would have been the logical outcome.
But who said the housing market was logical? The result we actually witnessed was quite the opposite. Suddenly everyone was working from home and with so much time spent in the home brought many to consider if their 4 walls were still the right fit for their circumstances. The so-called ‘race for space’ followed.
Larger houses, particularly detached houses, in the suburbs or in the countryside started looking more appealing than ever, with their larger gardens and extra bedroom, which would serve perfectly as a home office.
But there were only so many such houses available to meet such an increase in demand. Most families occupying detached family houses only look to down-size when the children are old enough to fly the nest, or when so much space isn’t required any more. Builders are building again, but they can only build so fast.
Thankfully it appears the worst of the pandemic is behind us, but the UK’s desire to move home is still some way from being satiated. So we find ourselves in this strange 2021 new-territory market where house prices, also aided by the stamp duty holiday and low interest rates, have shot up an eye watering 15% just in the last 12 months, and where the numbers of available properties to buy are down by 30%-50% (depending on which area you live in) compared to pre-pandemic levels.
Would-be vendors still wish to move, but a tight hold is now on the market caused by the lack of available rungs on which to climb, and the added competition from other ready-to-move purchasers. For most, an onward purchase can only be facilitated by having their own buyer already lined-up. But who wants to put their house on the market with the uncertainty of not knowing where they will be moving to? This is nothing new, but the current market is adding greater uncertainty in being able to secure an onward purchase to tie into vendors’ chain.
So what can be done about it?
We work with vendors day-in-day-out to navigate this thorny issue. And the great news is we have had a great deal of success helping our local vendors with these problems so they can make their move. These are the most common ways to get around this current dilemma.
- Find a buyer who is understanding of the current market, and who is flexible on their moving date. This is where a good Estate Agent comes in. They will understand the vendor’s position perfectly and will select the ‘right’ buyer to suit their circumstances. These buyers may include renters, first time buyers, cash buyers, or those who are living with family. Some have already sold to break their own chain. They often have ample buying funds in the bank and are ready to go, but crucially they can also wait. Those who have put themselves here, find themselves in very strong buying position which usually puts them ahead of their buying competitors.
- Rent to break your chain. This can be unappealing, particularly if you have children in school, and does require yet another move once a purchase is found. However, as mentioned above it does set you aside and above from other buyers when making offers on your dream home. However, this is a particularly good option if you are moving to a new area since it provides the opportunity to ‘try before you buy’ in an area you don’t already know. 6 -12 months renting gives you the chance to learn all about a new location and where you might want to live before you commit to a purchase.
- Move in with family. Again, this isn’t an attractive option for most, but it may work if your unit is small and you have a flexible lifestyle.
- Rent from your buyer as a temporary measure. This may give you more time to find your dream home, without having to move from the one you are selling. This does require negotiation with your buyer, who effectively would need to agree to become your landlord. If your buyer is purchasing with a mortgage however, it would need them to take a buy-to-let mortgage to be able to do this.