Applying for a mortgage can be a daunting and scary experience, especially if it’s your first time. We are here for you throughout your application process, ensuring that you are fully prepared. We’ve created a simple checklist to ensure you have the best chance at securing a good mortgage offer.

Register to vote

Any lender is likely to turn you away immediately if you haven't registered to vote. Now this may seem confusing at first, as what does voting have to do with buying a home? If you have registered to vote, it provides the lender with background information and allows for a trusted confirmation of your current address and grants the lender access to your credit history. 

Prepare proof of your income and deposit

Providing proof of income is important to lenders as it allows them to see your reliability with past repayments. The lender may want you to supply evidence of your payslips for the past three months to prove your income and that you can afford the mortgage you are applying for. They will also want to receive evidence of your deposit and that it is easily disposable to the bank after the mortgage approval. By having these documents prepared, you can show that you are organised and reliable, placing confidence in the lender.

Double-check your credit history

When applying for a mortgage, it is imperative to check your credit history. A bad credit score is one of the largest factors that will influence a lender to reject you onto a mortgage programme. It is essential to double-check your credit history to ensure that it is all correct, as if not, you allow yourself sufficient time to dispute this prior to the lender checking your credit history.

Furthermore, it is important to improve your credit score as much as possible in the six months leading up to your application. This will aid in you showing the lender that you are reliable with repayments since lenders will be evaluating your repayment reliability and overall credit responsibility. 

Pay your bills on time

When possible, you should strive to pay bills in a timely manner. Overdue payments can tarnish your credit score, however like all credit issues lose impact the older they get. In most cases, lenders will primarily focus on the six months leading up to your application. Due to this, it is important to be cautious of your repayments, especially in the build-up of a mortgage application.

Reduce your debt-to-income ratio

Your debt-to-income ratio is the proportion of debt you have, in your name, compared to the amount of income you are earning. The higher this number, the more debt you have in proportion to your income. Lenders favour applicants with a lower ratio, as this provides lender confidence in your ability to reliably pay timely mortgage repayments.

Joint mortgage?

If you are applying for a joint mortgage, then it's vital that you also check this list with all applying, as if one of you doesn’t match the lenders criterion, you will be turned away. Don’t let this be you and get ahead of the mortgage game by getting prepared; you’ve got this!

As summer rapidly approaches, on the back of a more than buoyant spring, homemovers are achieving good asking prices and getting offers accepted on their new homes. House prices are firming up, instead of rapidly rising, due to sensibly paced house price inflation. This creates good buying and selling conditions; however, it’s as important as ever to price your home correctly, so you can ‘mind the gap’.

What does ‘mind the gap’ mean? 

‘Minding the gap’ refers to the difference between the asking price a vendor is willing to accept and the agreed selling price of a home. The good news is the gap is narrowing, with the average difference between the asking price and the agreed sale price growing smaller, with average discounts at 3.9% in March, falling from 4.5% in November 2023.* These figures are yet more proof of an improving market. In some cases, this gap may not exist and it’s also worth remembering that homes are usually priced knowing that there will be room for negotiation. 

The art of negotiation

When an agent places a value on your home, they will do so knowing that buyers, will more often than not, try to negotiate on price, so they will take this into account. As a seller, you want to achieve the best possible price for your home and as a buyer, you want to get a lower than asking price offer accepted. Your agent or agents, if you are selling with one and buying with another, are working in your best interests. So, when it’s time to negotiate, even though it’s completely up to you what price you want to offer or accept, listening carefully to your agent's advice is crucial. 

Your home and your position in the market are unique 

Your home is as unique as you are, and may achieve more than the asking price, if it gets a lot of buyer interest. This could bring about a sealed bid. Even if this does not happen, you may not have a gap between your asking price and the agreed selling price of your home. On the other hand, if a cash buyer makes an offer below your asking price, then you may decide to accept the offer so you can make your move more quickly. Setting the asking price correctly in the first place should mean you will not have to reduce your price by too much. But, that does not mean you should simply choose the agent who places the highest value on your home.

The best valuations are not always the highest 

A good agent will value your home thoroughly, which is what you want. This is because they will find the features and positives of your home, its location, and the local market, so you can achieve a good selling price. It may be tempting to choose the agent who places the highest value on your home; however, it’s not always a good idea. Overvaluing your home can lead to your sale becoming stale. Some homemovers have found that they sell with a second agent, after not selling with their first choice, because the asking price was set too high.

Know your market 

In March, the percentage of asking prices achieved in the UK stood at 96.1% and with a 9% increase in sales agreed, the market is getting stronger.** However, your local estate agent will be an expert in your local market and in advising you on how to prepare your home for sale. They will also put local market analysis and a database of buyers to good use which will help your home find the right buyer at the right price. It’s good to keep track of the market yourself, by checking out recently sold prices, and comparing the condition of other similar properties. Then you can come up with the right pricing strategy with your agent, that gets you to where you want to be, without a big gap.

Zoopla*
hometrack**

The rental market is continuing to look strong for landlords as we head into summer, with Zoopla reporting a 7.8% increase in rental prices between March 2023 and March 2024.* Let’s explore how this increase benefits landlords and how a letting agent can help you increase rental prices correctly.

Benefits for landlords

Increased rental income

As inflation drives up expenses such as property taxes, maintenance, and insurance, landlords often adjust rental prices to maintain profitability and cover their investment costs. By making sure you don’t exceed inflation rates, you can remain competitive while still covering your expenses and improving your return on investment.

Financing property renovations

The additional rent income you earn from rental prices increasing can be allocated towards funding renovation projects aimed at enhancing the property’s overall value. These improvements could include upgrading appliances, improving energy efficiency, and modernising interior spaces, all of which can help you command higher rent prices and increase the property’s value to boost long-term profitability.

Mitigating financial risks

Increased rental prices also help you protect your finances and reduce the impact of unforeseen expenses, such as vacancy periods. Additionally, as you can allocate more funds to maintenance and repairs, you are less likely to encounter issues with your property in the future, further stabilising your income.

Why it’s important to set a realistic rental price

Tenant affordability

Although it may be tempting to significantly increase rent, it is important to keep any increases to a sensible level. Setting rental prices too high can outprice tenants and reduce the amount of interest in your property, potentially leading to costly vacancy periods. 

Tenant retention

Rental prices directly impact tenant satisfaction, so your current occupants are much more likely to stay in the rental property if they feel that they are receiving fair value for the rent they pay. If the rental price is too high, tenants could seek alternative housing options.

Market competition

An accurately priced rental property is a key component of remaining competitive in the market, as overpricing your property can deter potential tenants and lead to prolonged vacancy periods. Overall, setting a realistic rental price is essential to effectively navigate market competition, attract tenants, and optimise your property’s profitability.

How a letting agent can help you increase rent fairly

A letting agent can play a crucial role in helping you increase rent fairly by providing valuable market insights, professional guidance, and effective negotiation strategies. Using their expertise in the local rental market, letting agents can conduct in-depth analysis to guarantee that any proposed rent increase aligns with the current market conditions. 

Additionally, letting agents can advise you on the best timing and rate of rent adjustments to maximise rental income while remaining competitive and fair to tenants. By setting a realistic rental price that aligns with rental inflation, comparable rates in the area, and the property’s value, you can ensure that your property remains accessible and affordable for a broader range of tenants.

As we head into the summer months, the property market is continuing to bolster as an increase in market activity continues to benefit home movers. Let’s take a look at recent property market data and how the current market conditions benefit sellers and buyers alike.

Recent market data

According to Zoopla's house price index, there were 20% more properties for sale in March 2024 than the previous year.* There was also a 9% rise in sales agreed during this time period.*

This rise in market activity is partly due to an increase in the average working wage and an overall robust job market, both of which boost consumer confidence. In fact, confidence in personal finances has reached the highest level in more than two years, according to GFK's Consumer Confidence Barometer.** This made homeowners considerably more interested in buying a new home, therefore increasing market activity.

Benefits for buyers

More choice

An increase in market activity leads to a wider range of choices available for buyers to consider. This improved choice empowers buyers to explore various properties, compare features and prices, and ultimately make more informed decisions that align with their preferences and needs.

Price stability

The market remains well balanced as the demand for properties and the supply of homes for sale have equally increased. Because of this, prices are less likely to fluctuate, potentially making for a more stable investment. Increased market activity also helps to create a clearer picture of the true value of properties, further contributing to stable pricing.

More negotiating power

Due to increased confidence, buyers have the opportunity to be more assertive when negotiating a price for a property. Since the supply of properties is so high, buyers are less desperate to secure a particular property and can carefully consider their options.

More opportunity for investment

For those looking to invest in property, the increased supply increases their options massively. In a busy market, investors can buy a property, make renovations, and sell for a profit in a shorter timeframe.

Benefits for sellers

Increased demand

With more people in the market for a new home, sellers can command higher sale prices for their properties as buyers engage in bidding wars. By achieving a higher sale price, sellers can then look for a higher-value property than they previously considered possible.

Faster sales

The increased level of demand makes it easier for sellers to find potential buyers, which can lead to faster sales and less problematic property chains. Additionally, if a buyer is particularly interested in a property, they may be willing to pay a slightly higher price to secure a quick sale.

Flexible terms

Strong demand can give sellers the upper hand in negotiating certain terms. For example, if the seller needs to close the sale quickly, they can choose the buyer who is in the best position to complete the transaction as soon as possible.

Less pressure

In a balanced and active market, sellers may experience less pressure to accept lower offers or make compromises that they're uncomfortable with. They can feel confident that a more suitable buyer will soon show interest and make a better offer.

How an estate agent can help

Estate agents use their in-depth knowledge of the property market to assist buyers and sellers alike in taking advantage of summer 2024’s active market. They have access to a wide range of property listings and can help movers identify suitable properties that match their needs and preferences. They are also skilled negotiators who can secure favourable terms and prices while guiding movers through every step of the process.