Good Time To Buy A House

Now could be an ideal time to consider a home loan and move up the housing ladder, an expert has claimed.

David Amstell of virtual estate agent Briffy said that as prices of houses are falling, now is a suitable time to make the move to a bigger property. If the right type of loan or mortgage can be found, then the recent drop in prices in the housing markets can be an advantage to those that are looking at a larger property.

Mr Amstell noted that people who are selling a property with a value of around 200,000 pounds or 300,000 pounds are currently in a good position to move up to a bigger home as the prices have dropped by thousands of pounds. Indeed houses that were valued at upwards of half a million pounds just a few months ago may now be on the market for upwards of 50,000 pounds less than they were.

People considering a move to a new home may be interested in finding the best home loan deal available to them, so that they can afford to make the move.

The sector expert added that there is also a trend for a form of reverse gazumping going on at the moment.

“Whats happening at the moment is that certain groups of people are actually agreeing to buy a house and on the edge of exchanging contracts [the buyers will say] well exchange if you take a couple of thousand pounds off and thats like reverse gazumping and thats been happening a lot recently,” Mr Amstell said.

A number of different house price surveys have all indicated the sustained downward trend in house prices over recent months. The Halifax House Price Index for October 2008 noted that during the month, prices fell by 2.2 per cent. On an annual basis, house prices fell by some 13.7 per cent, with average house prices now standing at the same level as they were in October 2005.

Despite these falls, property prices are still some 22 per cent higher than they were five years ago, when the average home cost around 138,000 pounds. Now, the cost of an average property stands at 168,000 pounds.

The index did, however, note that the house price to earnings ratio - a key measure of affordability - is currently improving “significantly”. It has fallen from a peak of 5.84 in July 2007 to 4.92 in August 2008. This is the first time that the ratio has fallen below 5.0 for four and a half years, although the long-term average stands at 4.0.

As well as this, the housing market is showing signs of stabilising, with mortgage approvals remaining broadly unchanged over the past three months. However, during the third quarter, approvals were some 25 per cent lower than during the same quarter last year.

Recent research from MoneyExpert showed that as winter approaches, homeowners may be using more gas and electricity around the home, meaning that utility bills are set to increase - and as such, some homeowners may find it difficult to pay.

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