When is a good time to buy an investment property? It is a popular question. When researched at the time of writing, it received 86,600,000 results. Everyone seems interested, from The Times, through lenders and mortgage advisers, to private individuals sharing their concerns via social media.
The answers are filled with statistics and shifting numbers of interest rates. We all need to be aware of those, yes. But there is a broader context to be taken into account. And every government change of rules and the strength of currency ultimately translates into your personal situation and needs to be viewed in the context of your circumstances.
At the end of the day, what matters to you is what this all means to you and your budget.
There is always a good time to invest in property. We have been saying it so often it has almost become our mantra. And we have been saying it so many times (including mentioning it in our blog articles) because we hear people’s questions and worries – am I ready to move? Shall I act now? Is this the right time? These are all valid questions and should be examined.
Property is a long game – whether you are thinking about investing in your first home or tenth apartment in your buy-to-let empire.
Many of us are on the fence and keep questioning what to do. Trying to predict the future is tempting, especially in a volatile market. However, the market is always in a state of flux. Rather than spending time on speculations, it may be better invested in analysing what is happening now.
Looking for a new property is an energy-consuming activity, and at times taking emotions out of it can be a challenge, but it is worth trying to assess your situation calmly. Consider the following:
Assessing Your Buyer Position:
As you aim to scale up your property portfolio, evaluating your buyer position is important to ensure a strong foundation for success. Consider the following:
1.1 Do I Have a Mortgage in Place?
Having a mortgage pre-approved gives you a head start in demonstrating your financial readiness to sellers and estate agents. It helps you determine your budget, enhances your credibility, and opens doors to attractive investment opportunities.
1.2 Do I Have a Deposit – or Would I Have to Stretch to Save Up?
A healthy deposit plays a pivotal role in expanding your property portfolio. It affects your borrowing options, interest rates, and overall affordability. If you have sufficient funds for a deposit, you’ll have more flexibility and better loan terms. However, if you need to save up, it’s important to plan and strategise to reach your deposit goals.
Anticipating Repayment Issues:
While scaling up your property portfolio can bring substantial financial rewards, it’s essential to consider potential repayment issues to ensure sustainable growth. Consider the following:
2.1 Could the Repayments Become an Issue?
Take a close look at your current and projected financial situation to assess your ability to handle mortgage repayments. Factors such as interest rate fluctuations, unforeseen expenses, or changes in personal circumstances should be taken into account to ensure repayment affordability as you expand your portfolio.
Pursuing Your Dream Properties:
Scaling up your property portfolio is not just about numbers; it’s about finding properties that align with your aspirations. Consider the following:
3.1 Assessing the Desirability of Your Dream Properties:
When expanding your portfolio, it’s essential to focus on properties that match your investment goals. Evaluate features, locations, potential rental income, and long-term value. Make sure the properties you choose offer solid returns and have the potential for capital appreciation.
The Impact of Staying Put:
Before committing to expanding your property portfolio, consider the potential impact of staying in your current situation. Reflect on the following:
4.1 Would It Be Detrimental to Your Situation If You Stay Where You Are?
Compare the advantages and disadvantages of staying in your current properties versus acquiring new ones. Assess market conditions, potential rental income, financial goals, and personal circumstances. This will help you make an informed decision about whether to invest further or make adjustments to your existing portfolio.
Simply look at the fact. Maybe even imagine you are looking at a case for a friend or talking to an expert who may coolly assess your position.
Keep an eye on the market at all times to be able to make a choice appropriate to your circumstances. You may want to talk to a financial advisor to discuss your personal situation or follow @MartinSLewis, founder of The Money Saving Expert, to keep up with the news. As long as you are aware of the situation, have an idea of how it may affect you, and are prepared to live with it, you should get a move on and put in an offer, to get that dream property.
One thing you wish to avoid is a property purchase becoming a source of financial trouble for you and your family. If you have a property in mind, the one that you can see yourself thriving in, and really want it with the means to purchase it – go for it. And if you do not – focus on organising your finances so that climbing a property ladder becomes a journey of satisfaction, of obtaining a new asset. It is to be an advantage – not adversity.
We are always here to talk if you wish to chat about the property market.