Why now could be the time to buy a bigger house

The vast majority of people who move home do so because they need more space. In the good old days, the late 1970s, people moved often – on average every three years. The average is now nearer two decades (you can thank stamp duty for that).

The same time period has seen a growing obsession in Britain about the value of our homes. If the value’s going up it feels good; if it’s going down we despair. But this has led to something of a blind spot about the advantages of a falling market to those wanting a bigger home.

A tough market is the best time to trade up. Buying a bigger (and more expensive) property will entail a bigger stretch if values are rising. But every so often periods of uncertainty or tightening credit lead to a fall – and for most that should be the time to pounce.

Let’s assume the smaller property you’re selling is, in your mind, worth £350,000 – but the best offers you’re getting are £325,000. You might picture this as a £25,000 loss. However, if the bigger house you were going to buy would have cost £550,000 in a stronger market but an offer of £500,000 would now secure it, then you could well look at this as an overall gain of £25,000.

My experience is that many miss out on this advantage as they attempt to ‘call’ the market and wait for the very best deal to fall into their lap – as if they’re going to know when things might bottom out. Or they assume things are never going to recover at all.

Calling the market has always been a mug’s game. These opportunities don’t come around often and as long as the usual sense tests can be passed – i.e. that you could live in your new purchase for ten years and that you can afford a mortgage at rates that pass stress tests (usually that you can afford 3 per cent above offered rate) – then the current market could well be the best opportunity many have had for years.