Home Truths: Is Now a Good Time to Buy a House?

Whether you’re a first time buyer or are thinking about moving home, making the decision to move up the property ladder is an important one. It’s easy to be put off by the headlines surrounding the housing market, with conflicting views and changing interest rates, many people are left asking themselves: is now a good time to buy a house?

Ultimately, this depends on your personal circumstances, we’ve put together this blog post to help you decide whether now is the right time for you to buy a new home. At Newcastle Building Society we understand that the process of buying a home can feel difficult at times, but with our guidance below, you’ll have the information you need to make the right choice for you.

Have you compared mortgage rates?

One of the first things for you to consider is how much you can afford to borrow for your mortgage. Our easy to use mortgage affordability calculator will give you an idea of how much we would be willing to lend you, based on several factors, including the value of the property that you may wish to buy.

For some people, current mortgage rates may also influence their decision as to whether to buy a house. November 2017 saw the Bank of England announce it's first rise in it's base rate for more than ten years. However at the Newcastle, we’ve made the decision that we will not change our mortgage Standard Variable Rate in line with the increase.

It’s important to shop around for a mortgage deal you can comfortably afford. You can compare all of our current mortgage deals at Newcastle Building Society, to find an interest rate and term that are just right for you.

Have you researched house prices in your chosen area?

According to a recent report1, homeowners should expect average annual increases of 2.5 per cent between now and 2022 - far lower than the 20-year rolling average of 6.9 per cent. However, according to data from Halifax that was reported by The Guardian, house prices unexpectedly fell by 1% in June 2017.

What really matters to you though is the average house prices in the area you want to buy a home. For example, according to the Office for National Statistics, the North East continues to have the lowest average house price in the UK and one of the lowest annual growth rates in the UK. This is great news for local buyers – and first time buyers in particular, who don’t have a property to sell.

Can you afford the costs of selling and moving house?

When deciding whether to buy, it’s not just your deposit and mortgage affordability that you need to consider. There are several other costs attached to buying a home, which include but are not limited to:

  • Valuation fee
  • Mortgage arrangement fees
  • Solicitor's fees
  • Land Registry fee
  • Local Authority searches
  • Property surveys
  • Stamp Duty (only on properties with a purchase price of over £125,000, and not applicable to first time buyers on purchases up to £300,000)
  • Buildings, contents, life and protection insurance
  • Decorating and furnishing costs
  • Moving costs

If you are also selling a home, you’ll need to take into account the costs of selling including estate agent fees.

First Time Buyers: Beware of the costs of buying your first home

Research conducted by Aldermore showed that first time buyers were particularly unaware of the costs of buying a home, with one in three saying that they simply didn’t have any idea about all of the extra costs. So it’s really important that you know exactly what you will need to pay out for when you buy your very first home, to ensure there are no unwelcome surprises and the process runs smoothly.

However, with the recent announcement in the Autumn 2017 Budget that first time buyers will no longer be liable to pay Stamp Duty on purchases up to £300,000, getting that first step on the property ladder may now be closer than ever.

We hope that the above questions are helpful to you when deciding whether now is the right time for you to buy a home. At Newcastle Building Society we understand that moving home is exciting, but can sometimes feel stressful, so our qualified mortgage advisers are available to answer any questions about the mortgage process that you may have. Call today on 0345 606 4488, or book an appointment at your local branch.

Your mortgage will be secured on your home. Your home may be repossessed if you do not keep up repayments on your mortgage.