cookstar

iTrader: (6)

Or anyone upsizing their property, just wondering if anyone has thought ***** to it and gone ahead anyway.

sti-04!!

I am in the process of purchasing another property. I offered the guy 80k shy of the asking price 2 weeks ago, he came back yesterday & asked if the offer was still on the table. It was less another 20k in todays climate.
He jumped on it. Hopefully will concluded in a few weeks. I am not in a chain as such so its hopefully all going to go ok.

moneys

iTrader: (5)

just put my house on the market and im upsizing, the so called credit crunch is yet to materialise in my world.

why not start a thread asking if anyone has been effected cos i dont know of anyone

.pslewis. .

Upsizing is absolutely fine in the current market - I'm waiting for the £1m houses to come within reach and I may make my final move ..... or, I will settle for a holiday home in Mudeford and keep what I have here.

Fist time buyers would be MAD to buy now!!

moneys

iTrader: (5)

.pslewis. .

I didn't think ANYONE were buying Big Expensive Cars???

moneys

iTrader: (5)

well they are peter otherwise we wouldnt be so busy

Jamescsti

A friend of mine works in a VW dealership and he say's business is absolutely dead.
I also spoke to a Honda dealer a few weeks back just through chance and he said the same thing, especially with performance cars such as the type r and S2000, people were calling him to sell cars back to them

Henrik

iTrader: (5)

Cookie, *don't* do it for gawds sake It's cheaper to rent than paying even an interest only mortgage + maintenance, so that's what I'll keep doing for a while.

I should say I'm saving the difference, but at the moment it seems to go on cars and holidays so still skint

Paul3446

I can't belive anyone would be stupid enough to buy a first time property now. It would be financial suicide!

john banks

moneys, if someone could have say a new 320d on contract hire for £150 on a 3+35 would that be a good deal?

The same is going on with houses at present. I'm soon moving to a nice farmhouse in 0.7 acres with coastal views. The present value is about £400k. I'm renting it for £800. I don't have to maintain, insure or garden it.

davegtt

Hmm, explains your negative opinion on the housing market for the last 5 years

al4x1

simply put everyone is sitting back and waiting, I don't think the so called credit crunch is putting people off as i've yet to hear of anyone who was in a half decent position and applied for a mortgage. What is putting them off is the news headlines and with them floating arround it has flattened the entire market to the point where next to nothing is selling. If you're a first time buyer there are plenty of bargains about and renovation properties that usually get snapped up without going on the open market are being advertised so to me its a buyers market but only if you want to stay put for at least a couple of years

Henrik

iTrader: (5)

House prices suffer biggest monthly fall since crash of early 1990s as cost of average home plummets by £5000 | Mail Online

I have been negative on the housing market for a couple of years, yes, but only because it's been ridiculously overpriced all along. However, if I had known that people were so stupid, I might have bought back in 2003 when I got married, but back then my salary would have only stretched to a mid terrace 2-3 bed and if you think I'd be paying 5-6 times my gross salary for something like that you're having a laugh

Coming from Sweden, I don't see anything wrong with renting for the rest of my life. It's quite common over there (even if you're not a pleb).

It doesn't make sense for house prices to rise above inflation for prolonged periods - where would the extra money come from?

Johari Window

My neighbour has spent the last 2 years lavishing a small fortune upon his house. He has then totalled up what he has spent, added it to the valuation he has just had and put the house on the market for that price. It smacks of desperation.

Still, it will make someone a great buy when the chickens come home to roost.

john banks

Henrik, your last sentence sums it up so brilliantly for the financially illiterate Brits.

davegtt

Does it matter, most people buy a house to live in it rather than think about its value.

Henrik

iTrader: (5)

Of course it matters, if I buy a house in a "slump" as compared to on top of the market, it makes a massive difference to my outgoings over the mortgage period. Look at the example below with a house priced at 200k vs 150k over 25 years at 6%:

Total repayment(200k): 391131
Total repayment(150k): 293349
Total Difference: 97782
Difference / month: 325.94

*Huge* difference (this equates to earning 6.5k per annum more if you're a higher rate tax payer).

The failing of the west IMO is that they let house prices go out of control in the first place. What the hell were the central banks + politicians thinking? They should have raised interest rates ages ago and staved off the house price boom in the first place, because then people could have gotten on with their lives, not got massively into debt and actually spent their money on something useful rather than line the banks pockets.

john banks

People were buying at prices that gave them unwise debts as multiples of their income or equivalent rental. They only did this because they believed that property prices will rise faster than earnings. If people just wanted a place to live in they would rent and treat a house like any other commodity. This would be assisted by a European style rental market. It is speculation, a classic bubble just like tulips, railroads, .com and housing many times before. It is worse with housing because of the leverage.

The recent years of many people making more money from their house than they do from productive work is an illustration of how ridiculous it has become. Now many will be losing more money from their house than they are earning. I hope they saved on the way up and didn't MEW too much...

davegtt

Henrik, on that basis your advice to FTB's all over the world is just sit, wait, hope and buy if/when the market crashes, regardless of what you can and cant afford.

That 200k or £150k mortgage you are talking about would have bought you alot more back in 2001 that what it will next year IF prices fall by 30%. Thats the point Im trying to make.

Paul3446

It's obviously always a bit of a gamble getting onto the ladder, but common sense tells you not to get on when prices have just started falling from what most people say are unsustainable levels!

davegtt

no I completely agree, only a fruit cake would buy at the minute.

john banks

In 2001 the income multiple required and the rental yield achievable supported the valuations much better. The last few years of a bubble are heady and it is impossible to predict at what level it will pop. Some of the biggest gains can be made there of course. Now with prices actually dropping and it being much cheaper to rent then you would only buy when you thought it was near or at the bottom.

After inflation some regions are already back at 2005 prices. 2001 prices in real terms may happen yet as you tend to get a vicious undershoot when a bubble pops. As it is I won't be disappointed if they don't, but I've signed up for a lease for 12 months as I think we're only at the start. I'm not catching a falling knife thanks.

cookstar

iTrader: (6)

Im not, just strted the thread to see what others were doing.

al4x1

If you didn't buy back in 2003 you're never going to buy as even a massive fall won't get back to those levels, had you bought you'd have paid 5 years off your mortgage and had you sold before christmas even a 2 bed house odds are you'd be sitting on close to 100K at which point a 10 or 20% fall isn't going to hit you that hard especially as it'll simply go back up if left. But it is far more common in Europe to just rent all your life but that does mean setting enough money aside to rent once you've retired. To my mind you've made a very expensive mistake but each to their own

john banks

Nationwide inflation adjusted figures:
1984 Q2 £73209 5 years before peak
1989 Q2 £114478 Peak
1995 Q4 £71703 Trough after peak

So why this time can you be so sure that we won't be able to buy again at inflation adjusted 2003 prices?

2002 Q2 is when the inflation adjusted price moved away from the trend. Previous adjustments undershoot the trend.

So why are you so sure?

PetesDad

It can, and may, drop back to 2002 levels.

I was buying and selling property in 1989-1994 ....... and saw rapid rises (1989) and rapid falls (1991).

I am always amazed that people believe that a 40% INCREASE in prices is possible in 1-2 years ...... but the very same people cannot even imagine a DECREASE of 40% in 1-2 years!!

Madness, pure madness.

jjones

looking at prices of 1 bed houses in a local town.

they would need to drop by 30% to fall into £25k (average annual salary?) x 3 price range with a small deposit territory. this seems to me to be about the point (or maybe even 33-35%) that people would start to get on the ladder again.

but it's a traditionally a cycle and so in the long SN tradition I am predicting a BOOM. Maybe not today, maybe not tomorrow but the BOOM is coming, mark my words!

john banks

People on average salaries don't want to buy 1 bed houses, they want and deserve something better.

jjones

who said they didn't? that is my prediction of what will happen.