What our
customers say
Mr and Mrs Gower, Blackpool
Mr G Graham,
Bristol
Mr and Mrs Carver, Lancaster
Blog : Should I sell my house fast for cash?
“Should I sell my house fast for cash?”
You may be considering a cash sale but wonder whether you could also try and find a quick sale through selling with your local estate agent. You may be wondering whether house prices are going to go up or down in the near future.
The UK economy is hanging in the balancing.
The debate goes on as to whether current inflation levels (Consumer Price Index 3.7% as at 20th April and Retail Price Index 5.3% as at 20th April) will rise, continue at existing levels or fall. The Bank of England (BoE) has decided to maintain the BoE Base rate at 0.5% because it takes the view that the economy continues to be too fragile to put up the base rate and considers that current inflation levels will subside.
The BoE target for inflation is 2% (measured by the Consumer Price Index)
The Government has announced that the Country’s financial position is worse than was originally expected. It is a fact that as at June 2010, the Government is borrowing over £378,000,000 every day to keep the Country afloat and the National debt grew by approximately £145 billion over the last year. Total Government borrowing stands at £893 billion which is 62.1% of GDP.
Because of the poor state of the Country’s finances, sweeping cuts are proposed in public expenditure. These cuts are anticipated to reduce the annual borrowing by around £5 billion. This is only a small proportion of the amount of annual budget deficit of £145 billion.
Many in the labour party hang on to their views from when they were in power that it is too risky to implement large scale cuts in services or other measures such as tax rises for fear this will push the economy back into recession. The Conservative party are however pushing on with cost cutting proposals as they are of the view the UK financial status is so bad, the UK cannot afford to wait any longer racking up enormous borrowings before bringing down the debt. The Conservatives are also concerned that there is the risk that without clear measures being taken to demonstrate the UK is serious about reducing its budget deficit, the UK’s credit status could be downgraded resulting in higher borrowing costs for UK residents. This is turn would apply additional burden on the economy and could send the economy spiralling into a deeper recession.
Scaling down public services will result in significant redundancies which in turn is likely to result in an increase in benefit payments and therefore, some of the savings in public expenditure will be required to pay an increased benefits bill which already funds payments for the 2.51 million unemployed in the UK. This pushes the prospect of tax rises even closer because the full benefit of savings from pubic sector cuts will not have a like for like impact in reducing the budget deficit.
The big question is will the economy continue to grow when so many cuts are going to be made in expenditure and when it also seems inevitable that more tax rises will be required to find money to reduce the budget deficit and pay back Government borrowing because public service expenditure cuts will on their own not be sufficient.
If the UK economy does not grow and borrowing remains at existing level, in less than 4 years, debt will have exceeded UK GDP and the Country will be technically bankrupt.
Unless other economies, such as the USA, grow and have a knock effect to help pull the UK out of recession, the road ahead for the UK is going to be very tough with the distinct possibility that the cuts and tax rises which are likely to be required will cause a second recession in the UK.
The extent to which this will affect house prices is also a subject of debate. On one hand, a recession will undoubtedly mean less people can afford to buy property, whether that be first time buyers or those wishing to trade up to a larger property. On the other hand, the population is growing and a growing population requires more houses and new house building has fallen well below levels required to sustain demand. It is possible that although there will be a housing shortfall, this will not mean increased demand from house buyers because of affordability at current values. The house rental market could therefore see increased demand.
Over the next year, it is quite possible that the Country will slip back into recession and that there will be a further fall in house prices. The scale of the UK debt is so enormous that it seems inevitable that even the large scale cuts in spending on public services will be insufficient to bring down the deficit and that tax rises will be required to try to bridge the deficit. This will mean less disposable income and fewer people able to afford mortgages for houses at existing values.
For those asking themselves “Should I sell my house fast for cash?” then, due to the economic outlook, it should be a serious consideration. A reduced price today for a quick, no nonsense sale should be considered. A no hassle sale without all the stresses associated with the uncertainty of whether the sale will complete may be considered by even more people now. After all, a reduced price today could be close to market value in a years’ time.
