It's the big question at the moment...
Current economic conditions have continued to worsen over the course of 2022, and the future of the market is largely unpredictable.
UK inflation rose to 9.1% in May, a further increase on the four-decade high of 9% annual growth recorded in April. On top of this, the cost-of-living crisis has continued to escalate, furthered by the war in Ukraine, which has had a stark impact on fuel prices in particular.
“The million-dollar question at the moment is buy, sell or wait,” according to Peter Izard (pictured), head of intermediary business development at Investec.
Demand has continued to outpace supply and as a result house prices have risen, however what lies ahead is unknown. Izard explained that the general public in the UK can only do so much, and whether they buy, sell or wait is, for the most part, determined by themselves, as life circumstances mean many will be forced into a decision.
“People will have children, people will get divorced, people will get new jobs in different cities, and therefore people will have to move homes,” he said.
Taking the approach of ‘now is the time to wait’ is dangerous according to Izard, explaining that you never know what lies ahead in terms of market conditions. Everything is based on the individual’s circumstances - he believes that a person should be guided by their current situation, not the market,
“Interest rate raises by the Bank of England, inflation, the impact of COVID, the war in Ukraine, the supply versus demand imbalance and rising house prices are all out of an individual’s control, and while they should be considered, they should not be the sole deciders,” he said.
Read more: UK inflation latest – official figure rises again
He added that for first-time buyers (FTBs), it may actually be better to buy sooner rather than later, as house prices are expected to rise and, unlike homeowners looking to move, FTBs do not have the luxury of being able to leverage their current home against their next.
A house purchase is a long-term commitment and getting on the housing ladder almost always assists an individual in purchasing their next property. Waiting out the storm can be a benefit, but it can also hinder an individual in their goal of homeownership, therefore Izard explained that it is best to do what the specific person needs to do at that time.
“If someone needs to buy or sell then they should regardless of the market, if the sale or purchase of someone’s home will improve their standard of living then that is what they should do,” Izard said.
He went on to add that the benefit of choosing the right time is not always an option, and sometimes you have to just bite the bullet and commit to a transaction.
“Waiting for more favourable market conditions is an option everyone has available to them, however it is not something that will always benefit the consumer, even considering the current market conditions,” Izard explained.
Overall, Izard believes that a consumer must consider their own individual circumstances above that of the market and make their decision based on their own interests.
