Upsizing your home – easier for some
With the property news full of tales of woe in the banking world and the related slump in the housing market, it is easy to overlook some of the better news that the falling price trend has influenced. In an intriguing twist it has emerged from recent research that trading up to a bigger property is now financially less problematic than only a year ago, depending on the size of house one needs to buy.
Despite the problems that many are experiencing it remains a fact that there are people who are buying and selling properties. Those who need to move for employment purposes have no option but to sell up and buy, and a growing family can also lead to the necessity for more space.
People moving into mid-sized properties appear to be best placed. Research into market trends has shown that properties with two bedrooms have fallen in price by a greater margin than any other category of property, with a 12 percent drop the average over the year. When one considers that single bedroom property has seen an eight percent fall it is clear that the gap is closer than twelve months before.
In fact, figures show that a buyer wishing to sell a single bed property and buy a two bed one will be better of by £10,000; one year ago the difference would have been over £41,000 while today is just £31,000.
Likewise, the difference between two and three bedroom properties is similarly closer; from £66,000 a year ago the difference is now just over £58,000.
At this point on the ladder things begin to change, as four bedroom properties have not fallen at anywhere near the same rate as smaller properties leading to an increase in the gap between them. Research gives the difference in price at ten thousand pounds greater than it was one year ago, meaning those looking for a bigger family home need to dig deeper into their pockets than ever before.
One reason for the difference is that the lower end of the lending scale has traditionally been the preserve of the first time buyer, or the buyer without much leverage or security. Lending to them means sometimes taking a risk, and the banks are no longer taking any risks whatsoever. Mortgages are unavailable for any but the most squeaky clean of borrowers, and these tend to be well established in the market place by this stage of the game.
Industry analysts are predicting that property prices will continue to fall in the coming year, with forecasts varying between ten and twenty percent on current values. Nobody can know for sure, but it is clear that the housing industry shows no sign of recovery as yet.
If prices continue to fall at varied levels for different size and styles of property it follows that the lower end of the market will close up in terms of price difference, leaving those wishing to move into the bigger properties with even greater gaps to fill in a year’s time.
The signs are for hard times for those wishing to invest in more than three bedrooms but better returns for anyone moving up from one to two, or two to three bedrooms. With the upper end of the market weathering the storm better than the cheaper ranges the trend looks to continue for some time to come.
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