Although England has taken its first steps towards exiting the lockdown under the UK government’s three-step plan, with estate agents now able to reopen and relatively normal housing activity able to resume (albeit with strict caveats), there are still a number of restrictions on our daily lives and transactions might take a while to get going again.
If you are buying or selling a home, you can still use the extra time at home – most employees are being urged to work remotely if they can, while the government insists its ‘stay at home’ message is still in operation – to prepare yourself for your move and moving day itself.
All the evidence points to sentiment being high among buyers and sellers, with many looking to act decisively as soon as it’s possible to do so, which means it’s even more important that you’re ready and prepared in advance.
Below, we at Balgores Property Group outline some of the steps – from budgeting correctly to securing a mortgage – that home movers need to take to get ahead of the game.
Moving home involves a number of costs, including upfront ones such as a deposit, agent fees and conveyancing costs, various mortgage fees and then the ongoing costs of running a household. It’s vital that you have the budget to cover all these costs before putting your home-moving plans into action.
You’ll also need to factor in the cost of moving day itself – which may now be more expensive with social distancing in mind, as removal companies need to do more to keep their clients and themselves safe. A DIY move is an option, but even this will likely require the hire of a van of some kind, which can prove costly in itself.
Make sure you set out a budget before moving home and stick to it thereafter. This massively reduces the chances of any financial complications further down the line.
One of the few upsides of lockdown has been the ability of many to save more than they ever have in a month, with all social spending off the table, hair salons shut up, football matches postponed, entertainment venues closed and holidays/travel off the menu. There has been no chance to eat out or spend a shedload on the morning coffee from Costa, while commute costs for many have come tumbling down.
People have also turned to baking, home-cooking, vegetable-growing and using up what is in the freezer to stave off the boredom of lockdown and avoid having to go to the supermarket.
As a result, making savings on things has been much easier. This might be something you want to continue, even as we start to ease out of lockdown, to give yourself as much wriggle room as possible with your budget. Work out your day-to-day living costs and see if any further savings could be made. Do you really need every single streaming service, for example? Is that food blender ordered from Amazon really 100% necessary?
These are the sort of spending habits you will need to scrutinise if you want to give yourself the best chance of moving home in a budget-friendly manner, where your resources aren’t overstretched.
A major part of the moving process is securing a mortgage. At the moment, record low interest rates mean mortgage rates are very competitive as lenders battle hard to win over borrowers.
If you haven’t yet applied for a mortgage, there are a number of steps you need to take to complete this process. First, you should check that your credit rating is in order – you can contact one of the UK’s three main credit reference agencies for a credit report. The better your credit rating, the better your chances of securing a mortgage – and a better mortgage deal at that.
To apply for a mortgage, you may need a number of documents including utility bills, proof of benefits, a P60 form from your employer, your last three months’ payslips, passport or driving license (to prove your identity), bank statements of your current account for the last three to six months, a statement of two to three years’ accounts from an accountant if self-employed, or a tax return form SA302 if you have earnings from more than one source or are self-employed.
Make sure you are accurate on your application form, and that this corresponds to the documents you supply. Don’t lie about (or round-up) your salary, for instance, to improve your chances of getting a mortgage.
If you are unsure about what documents you will need, speak to your agent or an independent mortgage adviser for help. As part of the mortgage process, you may also need to provide details on how much your outgoings are each month, including how much you’re borrowing on credit cards and other loans.
When picking the right mortgage for you, it’s wise to seek the advice of a mortgage adviser to ensure you are getting the best possible package. There are a range of different deals and mortgages on the market, which can prove confusing and intimidating. Price comparison websites can be a good way to find mortgages tailored to your needs.
A lender can calculate the total cost of your mortgage and also work out how much they are willing to lend to you (based on how much you can afford to borrow). They can provide you with a mortgage in principle – or agreement in principle – which shows they are willing to lend to you, and how much. This will help to show that you are a serious buyer.
This Money Advice Service article provides more detail.
Here at Balgores, we will work alongside the new government guidance to ensure we are helping our clients to buy and sell property in the safest possible manner. You can find out about our current operations by calling or emailing us. You can also submit any form on our website and a member of our team will get in touch.