Selling a property fast in a difficult housing market

Selling a property fast in a difficult housing market, negotiating the best terms to buy property and hard to get mortgages

It has to be said that it is not the best time to be selling a property when house prices are falling, especially if you have to sell it fast. Nor is it a good time to be buying property when prices are likely to drop even further. So whether you are buying or selling, you need to ask yourself if you have to do it right now or should you wait until mortgages are more readily available and the housing market has settled down and confidence returned.

Start of article about rising mortgage costs.

Previous page about falling property prices.

If you have to sell your property now due to financial reasons; the bank is foreclosing or you are so behind in your mortgage repayments that you have no option, then consider this. If you are able to sell and get out with a profit, property prices are likely to fall and you will be able to re-enter the market when things have calmed down.

If you have to sell your property and are looking to buy another property, you will almost certainly have to sell at a price that is less than it was valued at before this credit crunch started. Whether it is a more expensive or cheaper property that you are buying, you need to obtain it at a percentage reduction that is at least the same as the reduction you accepted on your property. We are talking percentages and not figures here. If you took a hit of 10%, you need to buy at a figure of -10% based on the value of the property before January 2008.

If you are considering moving simply because you need a bigger house, you should consider extending the property instead. Rooms in the roof, garage conversions, building extensions can all add value to your property, even in this market and will cost you substantially less than the expense of moving.

If you have to sell, you should seriously consider selling your house privately. This will save you between two to three thousand pounds on average in estate agents commissions and possibly much more. You will be in control of the price you need or want for your property and not be persuaded by an estate agent who is desperate for the sale and the commission.

BUYING PROPERTY WHEN PRICES ARE FALLING

Do you really need or want to buy a property right now? Property prices are likely to continue to fall at least until the end of the year and remember that property has been overvalued and continued to rise for more than a decade. Had this continued, the average first time buyers property would have cost £250,000 by 2012 or simple terms ten times the average salary. This would not just have put the possibility of buying a home out of the reach of the vast majority of first time buyers, it would have made the rental incomes needed by buy to let landlords unaffordable.

This is what has happened. Buy to let landlords, especially those who had little experience in investing in property have continued to borrow money and invest in property in a continuously rising market and now find they cannot afford to let the properties at sensible rents in order to cover their mortgage repayments.

Property is a good medium to long term investment. In the short term, if you do not have the money in the bank or the income to ride out price fluctuations or a credit squeeze, you will lose your shirt. The problem is, property price fluctuations and a credit squeeze normally go hand in hand and anyone sitting on a property or properties with less than 25% equity and the means to service their mortgage(s) is in dire trouble right now.

So if you are looking at buying property right now, you should not offer more than 80% of what it was likely to have been valued at in December 2007. Be prepared to walk away from any property that you cannot buy at this discount rate. You may even make an initial loss on paper even at this heavy discount because prices may fall even further than this. However, you will only make a loss if you choose to sell at a loss. Property prices will start to climb back, but we will not see the huge year on year increases of the past; those days are gone for many years to come because money is never going to be as readily available again because of what has happened to property prices.