There’s pros and cons to moving house right now. Rental costs have gone up, but so have mortgage interest rates, although there are still some good deals available.

There’s no easy answer when it comes to deciding whether or not now is a good time to move house. A lot will depend on your personal circumstances and how the current economy is affecting you.

Interest rates are rising, and it seems that they may continue to do so for some time yet. Although low by historical standards, those who have only been homeowners since 2010 might consider them to be high. And, with prices for properties in many parts of the country beginning to stabilise, there may be some good deals to be had.

If you’re already struggling to keep up with your mortgage payments, moving house could put you even further into debt. And, with the cost of living rising, it may be difficult to afford a move at all.

That said, there is talk of government help on energy bills, although details of what help and support may be available have not yet been revealed.

A desire to move

However, irrespective of what’s going on, some people still need to move or may have a strong desire to do so, regardless of the current situation. It depends on how important it is for you.

Ultimately, the decision of whether or not to move house is a personal one. Weighing up the pros and cons is essential in order to make the best possible choice for you and your family. 

If you’re a first-time buyer…

If you’re one of many renters currently being hit by rental increases, you may think it’s best to buy your first property. While this means you’ll have more responsibility (when things go wrong, it’s down to you to get them fixed), you’ll have an asset that should grow in value. Plus, you can decorate the place how you want and not have the worry of the landlord increasing your rent or deciding they want their house back with two months’ notice. They can do this regardless of whether you’ve been a good tenant and have paid your rent on time throughout.

You definitely have greater control if you’re a homeowner. But it’s crucial to ensure you can comfortably afford your mortgage payments. Speak to a reputable mortgage broker to find out what your monthly payments will cost. Work with them to develop a long-term strategy that suits your financial position. When you do buy a place, make sure you have some funds in reserve. You could look at locking in a two or five-year fixed rate mortgage deal so that you won’t be affected by future interest rate rises for the next several years.

If you want to buy your first home, keep saving for a substantial deposit – get as much cash towards it as possible – ideally 10% of the purchase price. Although it is possible to get a 95% mortgage and only put down a 5% deposit, the higher the deposit, the more competitive your mortgage interest rate.

If you’re looking to upsize…

You may be feeling cramped in your current property and feel desperate to move to a bigger home with more space. Or you may be thinking about starting a family. It’s tempting to want a bigger property but bear in mind that a larger home is not only going to be more expensive (unless you move to a much cheaper area by comparison) but also more costly to run. More rooms and space mean higher energy bills.

In addition, if you’re currently living in a flat or a house with a small garden, a property with a bigger garden will come with higher maintenance costs. If you have a paved garden, for instance, you won’t have to worry about cutting the grass or dealing with overgrown bushes or plants. If you move to a large house with a big garden, you’ll either need to tend to it yourself or pay a gardener.

Again, we recommend speaking to a reputable mortgage broker who can advise you on what you could borrow. Make sure you know the value of your existing property and what you owe on your current mortgage before you speak to a broker. The more precise this information, the better.

What’s happening with interest rates?

You may be concerned about talk of rising interest rates. In an effort to combat rising inflation, The Bank of England has increased the base rate consistently since last December, when it was 0.25%. It now stands at 1.75% – its highest level for 14 years.

Further base rate increases are also likely over the next few months (with base rate reviews occurring in September, November and December). Lenders have also increased their rates. Fixed-rate mortgages are available for two, three, five, seven and ten years or longer. For some, this may be valuable peace of mind. A good broker will discuss your short, medium and long-term plans and advise you accordingly based on your circumstances and preferences.

more news