Should first time buyers wait until after Brexit, or rush and buy before 29th March?

SouthLondonUser

_CC_ wrote: »

"It said that with new instructions from landlords down and tenant demand up, rents were likely to rise by about 2% this year and accelerate to 3.5% a year over the next five years, outstripping projected pay rises."
.

It's not clear what area this refers to. Does it refer to the areas outside of London and the SE, i.e. those very same areas where the market is performing better?

It seems that, in London, one consequence of the slow real estate market is that some people are letting their properties rather than selling them, i.e. new instructions from landlords are not down. However, this is anecdotal - I am not aware of any precise assessment of the phenomenon.

airandwater

Linton wrote: »

You cannot time the market, or if you think you can dont tell other people.

Timing the market perfectly is hard but as chain free first time buyer you have the luxury of "wait and see".

Sure there will always be things to worry about but brexit is unique in that it is a definite thing that will either happen or not happen.

Thus following the market for another 3-6 months isn't a bad thing. Especially if you can save 10-20% on your first property which isn't pocket change when talking about house prices and stamp duty.


Unless you are very settled in your job or have kids, wait until March to buy your first home.

Businesses highly exposed to brexit could move operations abroad or restructure. You don't want to shackle yourself to a home if there is a risk that you and your partner's job could change.

The only exception to this is if you come across a hard to find property you can see yourself in for a number of years.

Crashy_Time

_CC_ wrote: »

Depends if they're renting.


If RICS are to be believed:



"It said that with new instructions from landlords down and tenant demand up, rents were likely to rise by about 2% this year and accelerate to 3.5% a year over the next five years, outstripping projected pay rises."


Ouch.

https://www.propertytribes.com/tax-bill-in-january-t-127636858.html


Ouch. Many landlords will be praying the tenant demand actually happens, but then their tax bill will be even higher? Double ouch!

buggy_boy

Crashy_Time wrote: »

https://www.propertytribes.com/tax-bill-in-january-t-127636858.html


Ouch. Many landlords will be praying the tenant demand actually happens, but then their tax bill will be even higher? Double ouch!

I think you are just proving the point, lots of landlords exiting the market while tenant demand increasing.

_CC_

Crashy_Time wrote: »

https://www.propertytribes.com/tax-bill-in-january-t-127636858.html


Ouch. Many landlords will be praying the tenant demand actually happens, but then their tax bill will be even higher? Double ouch!

Exactly Crashy. Tax changes have meant decreased landlord instructions while tenant demand continues to increase, leading to higher rents.
It makes me feel fortunate to know exactly what my monthly mortgage payment is going to be given I managed to fix it until the end of the term.

jimbog

Crashy_Time wrote: »

https://www.propertytribes.com/tax-bill-in-january-t-127636858.html


Ouch. Many landlords will be praying the tenant demand actually happens, but then their tax bill will be even higher? Double ouch!

If their tax bills are even higher then, as demand is still increasing, rents can only go up

Crashy_Time

jimbog wrote: »

If their tax bills are even higher then, as demand is still increasing, rents can only go up

I was joking, raising rents isn`t going to work for the guy in the link..


"My accountant has told me what my self assessment tax bill is going to be in January, my dilemma is this, the only way i am going to be able to afford the bill is by selling one of my Properties to release the equity"


Speculating/fantasising that raising rent might be a lever that is available to get out of trouble is just like the paper value of an unsold house, it is a meaningless concept until it actually happens in the real world. Tax demands on the other hand are very real. Brexit will be a negative for tenant demand as well, further eroding the ability to put up rents.

Crashy_Time

buggy_boy wrote: »

I think you are just proving the point, lots of landlords exiting the market while tenant demand increasing.

Nah, tenants will be going home after Brexit, hence less landlords needed. The houses don`t disappear though, they will still be there.


https://www.lettingagenttoday.co.uk/breaking-news/2018/10/huge-30-collapse-on-buy-to-let-purchases-in-just-three-years

_CC_

Crashy_Time wrote: »

Nah, tenants will be going home after Brexit, hence less landlords needed. The houses don`t disappear though, they will still be there.


https://www.lettingagenttoday.co.uk/breaking-news/2018/10/huge-30-collapse-on-buy-to-let-purchases-in-just-three-years

Yet more gibberish from Crashy.


Going home after Brexit? If you're referring to EU nationals then it's been made clear to them that they'll be allowed to stay and be protected post Brexit.



Even in 2017, i.e. after the referendum, the UK had close to a 300,000 net migration figure.



Rental properties may not 'disappear' but there is, and will continue to be given the starting point, more demand for housing (owner occupied and rented) than supply.


Your link, again, backs up what RICS is saying about a reduction in Landlord instructions. Looks like it could be a bad time to be a tenant

SouthLondonUser

Your crystal ball must be working much better than mine - mine is showing a big question mark

The truth is, no one can know for sure. London and surrounding areas are certainly affected more by Brexit than other parts of the country.
There are multiple phenomena at play, and I don't think it's possible to determine the net effect on rents. For house prices it's much easier: prices have come down in prime areas and stayed mostly flat (in nominal terms, which means they went down in real terms, ie they haven't kept up with inflation) in other areas. Many people are staying put so transaction volumes have plummeted. As long as rates and unemployment are both low, there is no catalyst for a price crash; if at least one of the two changes, it may well be different.

As for rents:

some Europeans may be tempted to leave; even if May has promised they'll be allowed to stay, not everyone believes a Home Secretary and PM who oversaw the illegal deportation of British citizens (Windrush anyone?); some jobs may be at risk (university and research jobs because of uncertainty on funding, all the jobs directly or loosely connected to finance, etc), some family situations are complex and the devil is in the details, etc

East London and the areas along the Thames are full of new developments which are far from fully sold; AFAIK they tend to meet the taste of Europeans and other foreigners more than that of local Brits. In Wandsworth they are building new apartment blocks right next to the dump, sorry, the council's recycling centre! The Nine Elms developments have already plummeted in value.

With the tax relief on BTL changing, it is possible that some landlords will be forced to sell. The exact scale and timing is, however, anyone's guess.

Some owners of multiple properties have given up trying to sell them, and are letting them out. So more supply. Again, the exact scale is anyone's guess

The article on fewer landlords buying properties is totally irrelevant because it says nothing about the number of properties available for rent; that is the key point. How many landlords sell properties to each other is totally irrelevant.

Is there any research on average rental prices in London? From what little I have seen, they haven't really increased over the last couple of years, but I have no idea how representative my experience is.