Sam Dunn: 'Is it a good time to get on the ladder?'

House Doctor

Question: After renting a two-bedroom house since 2004, my husband and I now have enough for a 20 per cent deposit on a property: should we go for it? We've kept an eye on the housing market as well as other economic signposts for 18 months, yet the flood of information is baffling. We know future prices are impossible to predict, but can you help us make any sense of our decision? Carol Garland, West Yorks

Answer: While the credit crunch and recession have at least snuffed out any lingering general notion that house prices always rise, the desire to know if – and when – it's a good moment to get on to the property ladder continues to burn brightly.

Since nobody knows for sure the direction of house prices, many believe the next best thing is to try to interpret all the data surging around the housing market. But a snapshot of economic factors over the past week or so alone reveals how illusory that path can be.

First, you've to grapple with the all-too-common confusion in monthly house-price indices: for January, Halifax says prices ticked up by 0.6 per cent, while Nationwide suggests double this, at 1.2 per cent.

Second, you face a number of statistics supporting a belief that the housing market may be motoring along nicely.

Elsewhere, Nationwide revealed it was lowering the minimum deposit size, from 40 per cent to 30 per cent, required for borrowers to grab its cheapest rates on many home loans.

Third, factor in gloomier outlooks dampening the market. A record 134,142 people in England and Wales were declared insolvent in 2009, up by more than a quarter on the year before, according to recent Insolvency Service figures.

Last week also saw the Royal Institution of Chart-ered Surveyors pile on woe: it unveiled its first fall in "potential buyer" inquiries since November 2008.

The problem with such a torrent of short-term info is it can change dramatically month-on-month and simply muddy the picture.

Yet your solution is simple, says Richard Morea at broker London & Country: shut out all the static from statistical reports and focus on what you and your partner want from your home.

"You can look at any number of indicators but it always comes back to your own individual circumstances and needs," he says.

"For example, as long as you can afford the mortgage payments, if you need space for a growing family, then buying now for the long term will make sense."

This is about you – and not the market – he stresses; "don't be beholden by what house prices appear to be doing".