How Does a Recession Affect the Property Market?
At present, the UK is facing a period of recession, which will naturally have some effects on the property market. If you are wanting to sell your home at this time, do not hesitate to reach out to Cash Home for advice and fast cash offers on your home.
What is a Recession?
A recession is a substantial, widespread, and protracted decline in economic activity. According to a general rule, a recession occurs when a nation’s GDP declines for two consecutive quarters. House values can be negatively impacted by economic downturns, although this is not a generalisation that applies to all properties.
When Was the Last UK Recession?
At the height of the Covid epidemic in August 2020, the UK experienced its most recent recession. Numerous businesses had to close their doors due to people isolating themselves and staying at home, and many others lost their employment. GDP decreased by 20.4% at this time.
Why is the UK Facing a Recession Now?
The UK economy is predicted to be in a recession until the middle of 2023 as a result of high energy costs, high inflation, rising interest rates, and a sluggish global economy.
What Will Happen Longer Term?
GDP should resume growing in the second half of 2023 as the pressure on real incomes from high inflation eases, tax reforms take effect, the weak pound boosts net exports, and the tightening trend for interest rates ends. Following that, the economy is predicted to grow by 2.4% in 2024 (the same as the Summer Forecast) and 2.3% in 2025.
Why Can It Be Difficult Buying a Property in a Recession?
It can be more challenging for homeowners to sell their current home and acquire a new one.
The overall value of homes may decrease during a recession, so it could be wise to think again before selling one. Recessions are frequently accompanied by growing unemployment and decreased household income, making it challenging for borrowers to ensure debt repayment.
In turn, this means that lenders exercise even more care when considering people for new loans and mortgages.
Should I Buy or Sell Property in a Recession?
The important thing to remember when buying or selling a home is that the property market will continue whether you choose to participate in it or not. As a result, the key is to think about your unique situation and decide what is best for you. During a recession, it could be difficult to acquire a new home if you first need to sell your old one. Your house might sell for less money than you anticipated or it can take longer to sell depending on the local market. You may not be able to sell your home via estate agents, so why not see what we can offer you as a great cash offer at Cash Home?
What Can I Do With My Property Now?
Suppose you need to act fast due to the uncertainty of the current economic situation in the UK and globally. In that case, selling your home to a reliable buyer like ourselves at Cash Home could be the perfect solution for you. Selling to us for cash is fast and you have no fees to pay as we cover them for you. We offer the highest cash price guarantee and you can sell in a timeframe that suits you. This could free up valuable equity in your property for you and your family to use in this financially difficult time, especially if you are worried that house prices will start to fall due to the recession.