Moving home is an exciting time in every home buyer’s life and overthinking comes with the territory. There are lots of moving parts and so much information available, from mortgage experts to ﬁnancial advisors across the board. In a way, it’s overwhelming to try to wrap your head around what the right move is, especially when a lifetime of savings are on the line for many of us.
Firstly, it’s okay to feel anxious about dipping your toes in. With property prices falling and interest rates rising, we’re not surprised by the uncertainty of buyers. On one side, the question is whether to wait and see what the market will do. On the other, it’s whether to strike while the iron is hot and jump into the property market while you can.
Whatever side you’re leaning, we’re here to help you make the decision.
Should I buy now?
Following a rapid boom of property prices during the pandemic, a slowing market, higher interest rates and the overarching terror that is the cost of living crisis pushed house prices into a steady decline. Although, statistics from September 2023 note that things may be levelling out, with an average price of a UK property standing at £366,281 – a 0.4% increase on August 2023. We’re also slowly taking positive steps towards improved buyer affordability as average ﬁve-year ﬁxed rate mortgages decreased from 6.11% to 5.12%, as well as a number of sellers reducing their asking prices of their properties to attract buyers.
However, a simple answer to this question is this: it depends on your situation. If you’re in the fortunate position to afford the mortgage repayments without stretching yourself thinly, there’s little reason not to bite the bullet and go for it. You just need to properly consider what type of mortgage you’re looking for and the size of your deposit. Though there are lenders out there who will agree on your desired mortgage for a 5% deposit, you should be completely aware of the total repayments. Remember, a larger deposit will give you better interest rates overall.
Likewise, there’s the question around whether to go for ﬁxed-rate or variable deals and how long for, and the pros and cons that go alongside it. For example, a ﬁve-year ﬁxed-rate mortgage usually offers better interest rates than a two-year ﬁxed-rate, but a con of this is that if the market changes and interest rates drop, yours will remain the same as it was the moment you signed on the dotted line. On the other hand, a pro is that you’ll know exactly how much you’ll pay each month until renewal, which gives us more clarity longer term.
For those saving, particularly ﬁrst-time buyers, the situation can feel a little more frustrating – especially if you’re also renting at the same time. However, there are many house builders like Durkan who are there to help you with your deposit and other ﬁnancial necessities. See also the DepositUnlock scheme designed to help you towards ﬁnding your home-sweet-home.
Why buy a new build house?
On top of a dozen other questions you may have, choosing between a pre-loved and new build home can also be top of the list. However, there are a few things to consider that nudge the dial in a new build’s favour.
New build developers can help you get off to a great start, with more incentives than a second-hand property seller. It depends on the builder, but these can be anything from having appliances and ﬂooring included, to paying your stamp duty and helping with agency fees.
The older the house, the more considerations there are, from general upkeep to potential reconstruction – and let’s not even discuss the complexities and limitations of Grade-listed homes. Over the years, there’s been lots of change in how houses are built, their requirements, and materials used. For example, if looking at a property from the mid-20th century you might need to check for things like wall tie corrosion (depending on the type of construction), traces of asbestos, and rewiring to meet modern safety standards. And with an average EPC ranking of ‘D’ across the UK, a lot of older houses need to be made more energy efficient by their current/future owners.
With new builds you don’t have to worry about any of that. Boasting statistically better odds, 85% of new builds rank A or B for energy performance and a potential saving of £1,600-£2,200 per year on energy bills. That’s not a small saving by any means.
Buying new also means you’re unlikely to have to put any major cash into play from the moment you move in, outside of what you put into decorating it just the way you like it. In fact, some house builders offer things like ﬂooring, wall decoration and appliances as part of the package.
Between sustainable building materials and practices, better energy efficiency, and its chain-free status causing less of a headache, there are plenty of reasons to fall in love with new builds.
What to consider when buying a house
Buying a house can be overwhelming to think of. Where do you want to look? What area is right? What are your must-haves? What size suits your needs? What’s your ideal and max price you can push to with the current interest rates? As many questions arise from thinking about this big decision, it’s good to remember that everything can be broken down into bite-sized bits.
As important as the actual house itself, the location is a key consideration in making your change. Whether you’re moving for work, for the next step in a relationship or because your family is expanding, you need to know that everything desired is within reach. Of course there are the ‘nice-to-haves’ on your list, like a good choice of eateries, entertainment and other amenities within easy reach. But you should also consider a few core aspects before starting your viewings. Durkan Homes currently have new build homes in:
How easy is it for you to get around? Whether you’re single, living with a partner or raising a family, living somewhere with excellent and reliable public transport makes your life easier. Whatever age you are, whatever your circumstances, you should never be restricted when on the go.
As well as this, the last thing you’ll want to worry about is feeling unsafe where you live. Your home should give you conﬁdence and comfort, so it’s always a good idea to do a little due diligence on any potential areas.
Cost of living
Current crisis aside, you should have an eye on your ﬁnances and know what the average cost of living will be in your desired area. Outside of the house price, what will it cost to live and enjoy your new life? What does an average weekly shop look like? How much is public transport or parking? You need to be practical about your budget to avoid any nasty surprises.
One thing you’ll need to have a grasp on when shopping for your new home is the current interest rate. With inﬂation at the mercy of the banks, having a ﬁnger on the pulse is always a good idea, even if you’re not ready to take the plunge just yet. And knowing how much you can borrow helps narrow your window just in case the perfect place does happen to come up.
For mortgages, there are two main types of interest rates: ﬁxed rate and variable rate. Which one you go for depends entirely on your position, and both have their pros and cons. A ﬁxed rate is excellent when the interest rates are low as these will be set in stone and unmoving until your agreed term is up. Variable rates are more ﬂexible, your repayments positioned to change at any moment, but you’re in control of when you want to leave a property.
It can be tricky to navigate, especially at the moment where it feels like things change by the week, but knowing how current interest rates are likely to affect your initial cost and the repayments gives you the power to make the best decision for you and your family.
For having experts on hand to help you from beginning to end, Durkan’sAssistedMove is invaluable for homeowners looking for their next place.
How Durkan Homes will help you
With over 50 years of experience and a number of developments across London and the South East, Durkan is the perfect partner for ﬁnding your next home. We’re also a rated ﬁve-star house builder on the Home Builders Federation.
Not only are our developments ideally located, just a short walk from the local town centre, minutes from the train station, and within striking distance of all the amenities you could want, we want to make the transition as easy as possible for you. As mentioned earlier, Durkan’s Assisted Move takes the pressure off selling your existing property. We’ll value your property, work with the estate agent (and pay agency fees), and support you throughout the sales process, offering independent ﬁnancial advice where we can.
Depending on where you’re looking, Durkan also has a number of tailored incentives available to help you move into your dream home, from putting money towards your deposit/mortgage to furnishing. And keep an eye on our website for our ‘Home of the Month’, offering gorgeous properties and great offers.