Kirstie and Phil give us their weekly expert update on what's happening in the property market, with a look at why West London remains such a popular place to buy, and how to buy a property as safely as possible in a falling market.
In this show, Sofie Allsopp looks at whether buying property is too much of a gamble - or still a safe bet.
'Since 1995, it's been assumed that your home would increase in value, but all that's changed in what's now looking like a falling market. Some suggest it's best to stick to renting until house prices settle again,' says Sofie. 'So, is it a gamble to buy property? Betting on a falling market means that you can either grab a bargain compared to house prices just a few months ago, or buy a house that just keeps losing value.'
David Hollingsworth, property expert, London & Country Mortgages, says: 'You are potentially looking at a tougher market in 2008, if house prices just dip a litttle bit, the danger is that you actually end up owing more on the mortgage than the property is worth, negative equity, and that's something you really want to avoid.' So what is his advice?
'It sounds so obvious, but do your research,' says David. 'Don't buy a duck. If you move in and suddenly find you need a new roof, and you've ploughed everything in to the purchase, and have no emergency fund, you're going to be in real trouble.'
'Sounds like the obvious solution,' continues David. 'But there have always been concerns over new build flats. Much in the same ways as a new car loses its value soon after you've bought it, if you're up against a whole load of new build flats and yours is a used (new build) flat, you could find that you've actually lost value on the property already in the short term. So, make sure you know exactly what you are buying and whether you're getting good longer term value.'
'Remember what you're trying to do, you're actually buying a home, so make sure it's a property you can be really happy in, at least for the medium term,' advises David.
'Property isn't really a short term bet to make a quick buck. Make sure it's going to be affordable for you, don't overstretch yourself on the mortgage and you can stop gambling on interest rates by fixing your mortgage rate.'
Don't overstretch yourself with the mortgage - find a rate you can afford. 'The bottom line is buying a property which may lose money in the short term is fine if you're happy to live there for a while,' concludes Sofie.
'Do as much as internet research as you can and look at newspapers, too. If you can physically get yourself into an area, see how much you like it, have a walk round, get a feel for it, all the better,' says Tessa Carnegie, Property Search Consultant with Garrington Homefinders.
'Good sources of information are always locals - anybody you see coming out of a house near where you are looking. Pop into a local shop, always buy the local newspaper and have a flick through that. Ring up a letting agent and pose that you are actually looking to rent in the area, and see what streets they recommend, and they may tell you which streets and areas to avoid. Anywhere you think you can get an idea of the type of atmosphere and the sort of people that live round there.'
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