Should you trade up in a depressed, but stable market?

publication date: Jul 14, 2011
author/source: Kate Faulkner, Designs on Property and Author of Which? Property Books
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Should you trade up in a depressed, but stable market?

Moving up the Property Ladder

If your market is still down on 2007 figures, it's vital to gain an understanding of what is likely to happen and also have a good look round to see what is for sale at the moment. Part of the reason why prices haven't fallen further than perhaps they should have done (in theory) is because not only has demand fallen but so has supply. That means there are less new homes to choose from as well as less second hand homes.

As with a rising market, you need to check you can finance the move and you especially need to be realistic about what your current property is worth. It will be a complete waste of yours and everyone elses time and effort if you try and ‘test' the market when it's depressed. Serious buyers won't even bother viewing a property unless it's reasonably valued - they won't waste their time!

In a difficult market, they want a good bargain and the benefit for you as you are trading up, this means you can save more money by bargaining hard on the property you are buying, but you can only do this if you have found a buyer for yours. To find a buyer in a tough market you too will have to be prepared to drop the price of your current home to help you trade up to a new one.

One thing which is essential in your market is making sure your property appeals to buyers. Speak to local agents and do some research to find out which is the best agent to sell your property. They won't be the ones giving you the highest valuation or lowest fee (and if they offer you both, run away!), they will make suggestions on what it is worth based on similar properties they have sold over the last few months.

Currently buyers want fab properties ready to move into or ones they can offer on which are a wreck. If your property is half lovely and half needs doing up, forget it, it won't appeal to either and you could end up selling for the same price - or less than the wreck!

One thing that may well be possible to help you is to buy a new build property from a developer that is willing and able to purchase yours. This can be an incredibly good way to trade up in a tough market. You'll get a good deal on the new build, which will have top ‘A' rated efficiency (ie lower utility bills) and if they buy your property you may not even need to pay estate agent fees, which could save you thousands.

Also read Article 3: Should you trade up in a falling market?


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