FINE & COUNTRY B US TING R EAL E S TATE MY THS
There are a number of commonly held beliefs about the property market that seem grounded in logic, but may be oversimplifications, or simply not true. Jonathan Handford from Fine & Country Leamington Spa breaks down some of the common myths to separate fact from fiction.
Everyone seems to hold opinions around real estate, and while some are observations f rom experience, there are also a number of commonly accepted ‘ facts’ that need closer examination.
Busting these myths is essential when prepar ing to enter the mark et.
One of the most pervasive ideas is that “property always goes up in value.” Many assume that buying a home is a guaranteed investment that will appreciate steadily over time. The truth is dif ferent: value depends heavily on local conditions, mark et cycles, and the type of proper ty, as well as your capacity to retain the proper ty through ups and downs.
If you bought in a declining market or in a weak location, you could see little growth in the shor t term, or even a reduction in value. I f you can weather the slump, however, at some point,
the value will likely 52
rebound, par ticular ly if the dip is connected to mark et factors, rather than location.
Under standing your tolerance to
market f luctuations can aid when determining the k ind of proper ty you are look ing for. Do you need a relatively stable investment, or can you take more r isk , for example, investing in a newer or less trendy suburb that you anticipate will boom at a later stage?
Another myth is that new-build homes automatically of fer better value or fewer problems than older homes. While modern f inishes and new-build incentives can seem appealing, they don’ t always translate into higher returns or lower r isk . Older homes of ten car ry more maintenance costs, but they may be better located or of fer unique features that buyer s value. Don’t underestimate the f rustrations of cor recting minor snags when it comes to a new build, either.
Many buyers believe that having a large deposit or waiting for the “perfect” moment to buy ensures a better outcome. In reality, timing the market is tr ick y and high deposits may tie up capital that could have been work ing for you elsewhere. For seller s, there’s a misconception that “highest
offer wins” every time. Of cour se, price matters, but other factors are also impor tant when assessing of fers, including the chain status, speed of completion and terms of the offer.
Leasehold ver sus f reehold is another area r ife with misconceptions. Many view leaseholds as automatically infer ior, while some consider lease length to be ir relevant. In fact, the length of a lease and the terms of ground rent and service charge can significantly impact mor tgage ability, resale value and buyer interest.
I t’s wor th noting that
leaseholds can be cheaper upf ront than f reehold proper ties and of ten have lower associated costs, like Land Registry fees and Stamp Duty. Some leasehold proper ties also offer shared ownership lease oppor tunities, where a leaseholder can purchase a share of a proper ty and pay rent on the par t of the proper ty still owned by the landlord, slowly buying additional shares until they own the whole. This can be a game-changer for f ir st-time buyer s or those with a tighter budget.
Another common misconception is that there’s nothing a seller can do to avoid an inf lated valuation f rom an estate agent.
In
reality, there is and it star ts by insisting on facts, not opinions. While most agents act with integr ity, it’s true that some may overstate a proper ty’s value to win
an instruction. This of ten
back f ires, with homes stagnating on the mark et, requir ing repeated price reductions, and ultimately selling for less than they might have achieved had they been priced cor rectly f rom the outset.
A professional market appraisal should always be evidence-based, suppor ted by several comparable sales and a clear rationale showing how the proposed guide price has been reached. Seller s
should feel conf ident to ask for that evidence. An accurate valuation isn’t about flattery it’s about strategy. Getting the price right ear ly creates momentum, generates competition, and of ten secures a stronger result.
In short, property is a complex asset and optimal market conditions vary by region, property type, time and personal circumstances. “New” isn’t automatically “better,” and the highest bid isn’t always the smartest.
Whether you’re buying or selling, the key lies in research and working with an agent who takes the time to explain the caveats – not just the headlines.
For advice on selling or buying property, please contact Fine & Country Leamington Spa on 01926 455950 or visit
www.fineandcountry.com
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THE MIDLANDS PROPERTY GUIDE FI N E & CO U N T R Y
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