A Bristol estate agent has spoken about trust when it comes to the current property market, reassuring Bristolians that house prices in the area aren’t falling, despite the current economic crisis since the government’s mini budget announcement last Friday. However, Bristol mortgage advisors aren’t as optimistic.
Andrew Simmonds, who runs both Parkers estate agents in North Somerset and Country Property in South Gloucestershire told BristolLive: “The property market has actually been volatile for months,” he added that, contrary to popular belief and media speculation, house prices are certainly not falling in the area. Andrew, who works predominantly with those selling their houses, rather than buying property, in the areas surrounding Bristol, also spoke about the stamp duty cuts announced in the government’s recent mini budget, as well as the current situation affecting mortgages.
He said: “It will have the most impact on those at the two ends of the scale – the people who are just starting on the property ladder and purchasing their first property and those at the highest end of the scale, who are purchasing property in upwards of millions of pounds.”
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He continued: “Though, those buying their first property will only see a difference in the cuts if they are paying amounts at the higher end. If they’re within that bracket where stamp duty does not apply anyway, then they won’t notice any difference there really.”
When it comes to advice for those looking to sell their properties in the near future, or even buy, Andrew’s advice was for homeowners and buyers to work with vendors and to come together when it comes to making a sale. He said: “Trust the local estate agents as they know the market in that area like the back of their hand and will be able to give you a realistic price for selling your home instead of an unrealistic, yet attractive sum.
“Understand that it’s harder to put your house back on the market once a sale has fallen through, or if you have over estimated its worth, and come together with the people buying your house to come to a deal. It’s not worth losing a sale over something like £5,000.
“I recently had a customer who was looking to sell their home and, when the prospective buyers informed them that their mortgage costs were set to rise, they came together and arranged a new deal.”
Andrew said he understands that this can’t always be possible, but he is a firm believer in people buying and selling property working together and trusting each other, especially now. He also said he couldn’t necessarily comment on the central Bristol property market but, in general, North Somerset and South Gloucestershire were proof that these sorts of points were commonplace among much of the property market in the area.
However mortgage advisors, like the director of Bristol-based Self Employed Mortgage Hub, didn’t quite agree. He said: “Unless we are very lucky and inflation falls much more quickly than predicted, I don’t see any other outcome than a sizeable fall in house prices, possibly 20%+ over the next 2-3 years.
“I’ll be accused of being a doom-monger, but if you use simple maths and common sense, how can house prices not fall? A lack of housing supply won’t help one iota when mortgage rates are somewhere between 5% and 7%, as is likely over the coming months.
“First-time buyers won’t be able to borrow as much, therefore they won’t be able to offer as much. It’s as simple as that.
“The truth is, housing is vastly overpriced and decoupled from average wages thanks to extended terms, higher income multiples and, above all, dirt cheap rates. With rates on the rise, the decade-long property bubble is about to burst. The worm has turned. It’s a buyer’s market now.”
And Robert Payne, director of Bristol-based Langley House Mortgages also said: “Up until recently, I have been optimistic we will not see a housing crash but given what is happening it is now a much more realistic possibility. I never thought we would witness such significant rate rises in such a short period of time and the impact this is going to have on monthly payments is going to be unaffordable for many borrowers.
“Up until August of this year, lenders were required to ask for evidence that the mortgage payments would still be affordable if there were a rate rise of 3% but we are already experiencing rate rises higher than this so those that borrowed to their maximum capacity and just about squeezed into the affordable bracket will see their payments become unaffordable even by the conservative rules of regulation, let alone the reality that people’s mortgage payments were already breaking the bank when they were much cheaper.”
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