Home Buying Advice: “I’m A First Time Buyer. Should I Wait?”

Advice: “I’m A First Time Buyer. Should I Wait?”


Question: “Do you think if you’re a first time buyer and ready to buy now (I’m living at home) that I should wait and see if prices drop? After viewing a few places yesterday agents seemed busier than ever and the properties I liked already had offers on”. James via Twitter – 24th May

Moving Home Advice says: There’s been a lot of commentary on social media in recent weeks extolling the demise of property values. A number of hysterical contributors grabbing any morsel of anecdotal negativity and wishing it into a forecast that house prices will ‘drop by up to 20%/40%’ etc.

For house prices to drop significantly enough for you to wait on the sidelines it would require one or more of the following:

  • Prohibitively higher mortgage rates
  • Restrictive mortgage lending
  • High unemployment
  • Uncertainty/negative sentiment

In order, let us deal with these one by one:

Bank rates are at an all time low and may go negative. It’s extremely unlikely that rates will be increased because that would throttle consumer demand and such demand now needs to be encouraged in order to re-start the economy. Some lenders reduced their mortgage rates this week.

Mortgage products are available and even 95% LTV FTB loans and 75% buy-to-let loans. This is simply fact.

Unemployment will increase. But will it increase to significantly high enough levels to stop hundreds of thousands of people buying a home or being forced to sell? We don’t think so. The furlough scheme, for now at least, is working and this week’s unemployment figures from the ONS portray a better picture than expected with unemployment at 3.9%, a record low.

Uncertainty is a thing, for sure. The media do like to provide a rather sensational commentary but that may soon subside when data confirms that things are recovering. And it’s this data that we have seen reported this week with estate agents, property portals and property technology service providers stating en masse that buyer activity is already back to pre-lockdown levels.

All things considered James, we think waiting for prices to drop may well result in you missing out. Don’t hesitate. Jump in now. After all, property is a long term thing and not an investment class to obsess about in price terms on a week to week basis anyway.

Expert advice is provided by Russell Quirk. 



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