Advantages of upsizing or downsizing in 2018

Finding your dream home can be a challenge. You might need a larger property if your family is growing, or if your children have left home, you might be looking to downsize. There are advantages of both upsizing and downsizing in 2018. Here is our advice on what is happening in the market that makes it good for either upsizing or downsizing.

There are pros and cons. Upsizing may be a dream but think of the practicalities. Your utility bills, council tax, and maintenance bills will be higher. General upkeep will be a much larger task; from gardening to cleaning, it will all take more time and resource. Downsizing might be more practical, but how will the lack of space impact on you? Your utility bills might be cheaper but will you be compromising? Maybe you hadn’t considered the need for a spare bedroom or a utility space, what about the outside space? Or simply the fact you’ll be much closer to your neighbours. For many, the realisation can sometimes be quite an adjustment.

Ultimately, the best time to upsize or downsize depends on personal circumstances. You have to be fully aware of market conditions, your budget, and be honest about your needs and requirements, otherwise you could stand to lose out financially and emotionally.

Whether looking to move to a larger property or seeking to move to a smaller, easier to manage home, stable prices make it easier to plan and healthy demand from buyers who can afford to borrow help make the current market fluid. Moving up or down the market, actual and purchase prices are less important than the price differential between the two.

Across the country, it seems that stock is an issue and whilst this may mean that new homes developers are taking a larger share of the market, competition between them is keeping prices steady.

This doesn’t mean that upsizers and down-sizers are so limited in choice though – it simply means that if they can’t find what they’re looking for, they need to work with an experienced local agent that provides a search and acquisition service.

Over the last 12 months, we have seen an increase in property prices and therefore increased equity for homeowners. This can make it an ideal time to downsize and cash in on your investment. Recently, I valued a four-bedroom detached property. The owners bought their home in 2015 for £266,000 and would now expect it to achieve £300,000. There are not many investments that will give you a return of £34,000 in 2 years. They were looking to sell and downsize to go mortgage free.

The main reasons we find people choosing to downsize is to release equity, go mortgage free, or the property they are in may be bigger than what they need. We believe downsizing is one of the hardest moves a person can make as comprise is needed. Therefore, our advice would be to think about what you are prepared to comprise on. If you only want a specific location, you may have to comprise on the size of the property or if off road parking is a must for you, you may have to give up that extra bedroom.

The market offers advantages at the moment for those looking to upsize or downsize. Since November 2017, first-time buyers have not needed to pay Stamp Duty Land Tax (SDLT) on properties priced up to £300,000, which will speed up the time it takes them to save for their first home. Mortgage rates are still at a historic low, making a bigger mortgage more affordable for many people.

You might be looking to upsize to accommodate a growing family or to downsize to release capital, reduce outgoings or if your children have left home. Whatever the reason, we would advise you to book a professional valuation and speak to a mortgage advisor before selling your home.

If you’d like to upsize; plan ahead. Perhaps you’d like to relocate to be closer to catchment areas for schools. Consider the timing of the school year when planning your move and allow for any delays in the chain.

Those looking to downsize should be realistic about the amount of space you need. Ask yourself: are you using all the space you’ve got or have you simply expanded to fill it? You’ll also need to consider the factors which are important to you, such as public transport, facilities and the local community.

As the market cools off, opportunities can arise for those looking to up-size as larger properties come down in value more quickly than the lower end of the market, which is propped up by both first-time buyers and buy-to-let investors. This can create an opportunity for buyers to procure a large property at a lower price while still achieving a good price for their own.

As the cost of living rises, down-sizing offers an opportunity to lower the running costs of your home and free up capital to spend on the refurbishment of a new, smaller property. The market has been rising for a number of years and, since 2016, has begun to cool, making this a good time to down-size, release large assets, cash in, and invest in a lower-value property, lowering your exposure to the market. With the cost-of-living rising, lowering your mortgage out-goings is always a wise move, too.

Are you thinking of upsizing or downsizing? Call Bowson Estates on 0191 2128100.