Is Now a Good Time to Buy a House?

August 17 2020 | Category: Latest Trends

Covid-19 has put a lot of things into disarray, including the property market. If you were looking at buying a house, you may have found yourself pausing, thinking to might be a good idea to wait a while and see what happens with the housing market. Given that the UK economy contracted faster than after the 2008 financial crash, that probably wasn’t a bad move. But since estate agents were given the green light to start selling houses again in May, things have slowly started to come back to life. And now many people are wondering if it’s a good time to buy a house, what mortgages will look like, and how it will impact their financial future.

House Prices

The first consideration in any house purchase is prices. The housing market has, by and large, remained pretty stable for the last few years, but a pandemic and 4 month lockdown will turn anything on its head. In fact, on the 7th of July Halifax confirmed that house prices have fallen consistently for 4 months in a row – the first time that’s happened since 2010. Property values in June were 0.1% lower than they were in May, following a 0.2% fall in May, a 0.6% fall in April and 0.3% fall in March. All of that adds up to a drop of 6.9% over the 4 months.

However, despite this solid 4 months of price drops, house prices were still higher in June when compared to June last year – around 2.5% higher. So while in the current climate house prices have dropped, they still aren’t falling to pre-Covid levels. There is a lot of downward pressure expected on house priced in the medium term, which will largely depend on the success of the government support methods and the speed of the economic recovery. So if you search you might find a bargain, but don’t go in expecting one.


We’ve already talked a bit in one of our previous blogs, but in case you don’t want to read the full version, here’s a quick summary for you. In general, the mortgage market is still in fairly good shape, especially if you’re looking to buy your first home. Lenders are in fierce competition, which means much better rates for the consumer. And with the latest announcements around Stamp Duty (more on that shortly), several lenders have started offering low LTV (loan to value) mortgages again. This means the deposit amount you would need to gather for your mortgage could be lower than it once was, making mortgages more accessible for many. Mortgage applications though, might be an issue. While they are still being processed, staffing problems and remote working means that most lenders are working at a slower than normal pace, so your mortgage application might take a little longer to process and approve. This can be frustrating, but it shouldn’t affect your ability to be accepted.

Stamp Duty Relief

This is the latest announcement, and the one that’s made a lot of new buyers very happy. The Chancellor, among many other points in his speech, announced last week that there would be a ‘stamp duty holiday’, coming into effect immediately. This means that anyone buying a home valued up to £500,000 (that is their main residence) will not have to pay a single penny in stamp duty taxes. Given that this tax is normally 5%, the move could save new buyers up to £25,000 on their house purchase. This is a pretty big incentive for many who have been on the fence about buying to get moving with the process again. The relief stays in place until March 2021 though, so that on its own shouldn’t be the main consideration for buying a house now.

All in all, the process of buying a house right now might look a bit different, but in practical terms there aren’t many differences. There are some areas where money could be saved, and if done carefully buying a house during Covid-19 could actually be one of the better moves. But only if you have your ducks in a row first and understand what you’re doing and what steps you need to take. At Chilvester Financial we are dedicated to providing you with as much information as we can and give you advice and support in taking out a mortgage. If you would like to have a free, no obligation chat with one of our financial advisers (via phone or video call of course), then just get in touch today.