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Smousie

Potential Ftb... But Prices Aren't Dropping!

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Hi DY, don't think you read & understood my previous post. I didn't say that people shouldn't have housing at all !!, I stated that its the expectation that everybody should own their own home that is wrong. 50 years ago, most people didn't own their homes, but they all had housing still, they rented either from the council or privately. Nothing wrong in desiring to own your home, to expect it as a right however ??

I also didn't say that I thought I should have a higher salary than Smousie, not sure where you got that from ?, I was just stating that I also had similar qualifications, but was on a lower salary . It was Smousie, who described her teaching salary as meagre & a pittance !!. I don't know any teachers who would describe their salarys as such ?, I would imagine she's on over £20k a year, maybe even £25k.

As a renter, having sold my house, I do hope house prices come crashing down, otherwise I may have to rent for a long long time. If I see a house I do want to buy & can afford, I will do.

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Phoney- Your point is what really scares me. Governments doing all they can to keep prices high to keep the banks assets high..

A new scheme every day!

http://www.express.co.uk/posts/view/156755/Plan-to-protect-debtors-homes

Interesting reply DY, I think you have a great grasp of what is going on and I agree with a lot of what you are saying. TBH I think the main difference is I have become a bit more pesamistic recently :( .

Phoney

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Jayne- Apologies if I read too far into your post, easy to do on a forum though!! However, I do believe it is reasonable to think people should be able to own their own home outright if they work. Why not? The only reason this is out of peoples' reach is because so much credit is given that artifically raises house prices.In a world with no credit people would have to save for a house which would lower prices dramatically and mean that those who were prudent and saved would afford their own house regardless of the age in which they were born. Heavy taxes should be put on second homes to discourage the greed of those who feel the need for second homes to make a profit from or use for holiday twice a year. IMO.

Phoney- I have days like you, it is easy to be pessimistic when there is a new scheme everyday. I don't think they have much left to throw at the market, but you never know! :ph34r:

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I hope your're right. I just don't see the political will to knuckle down and live with in our means.

"The purpose of money printing was to monetize the huge government budget deficit that has ballooned to an annual £180 billion i.e. nearly 30% of the annual government public sector spending budget. This is not sustainable and urgent action has to be taken to bring the budget under control by means of tax rises and deep cuts in public sector spending as the consequences of not doing so are highly inflationary as we witnessed with today's record surge in inflation"

http://marketoracle.co.uk/Article16609.html

I think i might order syndney's book recommendation "the pinch". Might make a cathartic read...

Phoney

They steered a similar course in Japan, a nation that has managed to maintain a trade surplus, and where goverment debt has been bought by Japanese citizens, the reason why they were able to maintain their base rate so low was they were not reliant upon the international bond markets. Japan was not able to engineer inflation, instead they simply sank under a mountain of debt, borrowing your way out of a recession does not work, you simply choke on the cost of servicing the ever increasing massive amounts of debt in vicious a downward movement that feeds upon itself.

I can't see too many British citizens queing to purchase GILTS, therefore we either continue with the policy of quantitative easing or we sell them abroad. QE was a short term fix, to continue medium/long term would destroy our already damaged reputation. My guess is that the next government shall be forced to substantially reduce the defict in the years ahead, despite the pain, as with Greece and Ireland. At the end of January the yield on ten year Greek bonds rose by over 40 basis points to 7.15%, the repricing of risk, the trend is clear!! Rates are set to rise around the world, our banking system is dependent upon the bond markets, fractional reserve banking is now consigned to a text book! We've been living way beyond our means, this shall change, political will...or not!

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Jayne- Apologies if I read too far into your post, easy to do on a forum though!! However, I do believe it is reasonable to think people should be able to own their own home outright if they work. Why not? The only reason this is out of peoples' reach is because so much credit is given that artifically raises house prices.In a world with no credit people would have to save for a house which would lower prices dramatically and mean that those who were prudent and saved would afford their own house regardless of the age in which they were born. Heavy taxes should be put on second homes to discourage the greed of those who feel the need for second homes to make a profit from or use for holiday twice a year. IMO.

Phoney- I have days like you, it is easy to be pessimistic when there is a new scheme everyday. I don't think they have much left to throw at the market, but you never know! :ph34r:

I cant really add much advice on where the market will go. Who knows- there are so many variables but some very good points made on this thread. All i can add is that if you have a property in mind that will stretch you, but you dont feel prices will reduce, why not consider having a lodger? We had a lodger at our last home paying us £360/month for a double bedroom, all bills included. He liked us so much/we liked him so much that when we moved into rented accomodation, he came with us. It made day to day living much cheaper without too much intrusion. Just an idea and good luck in whatever you decide to do

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It's a similar situation here in North Tyneside. We are seeing a very slow market at very low levels. However there are still some buyers. As there are no forced sellers the prices don't seem to be going anywhere fast. Can they hold until inflation kicks in? Maybe maybe not. It wont make much difference in 5 years time IMHO.

Phoney

Inflation in houses won't kick in until velocity of money in the housing sector increases massively (look at how low volumes are), the only way given our present situation that that will happen is if lots of people could afford houses again and are willing to invest in property, the credit tap is now off so the only other thing that could happen is prices re-adjust to affordable levels.

In essence, it may not be possible for inflation to take off until money is flowing... and even then it has to flow into houses... and by then people may have been bitten in the ass by property and will be staying well clear.

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Well, very much in the same boat myself - howeverI could up sticks and move back to Sweden and my home town and buy a big detached house for 30 grand! However, the issue would be finding a job. Not so easy. Or a decent pint, if you are so inclined.

I think it's difficult to say where things are heading - if I had to bet I would say house prices will creep down, perhaps a sharp shock after the election and then trickle downwards but I have no proof or anything to support it. Aaaanyway, good on you for moving closer to your parents to help out.

If I was you, I would give it 6 months - if things havent improved and you feel that dealing with landlords just isn't going to cut it - look to buy. However, I suspect things will be very different in the summer after the election.

Either 1. There will be massive public sector cuts if the tories get in.

Or 2. Labour win - interest rates 10% plus.

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Either 1. There will be massive public sector cuts if the tories get in.

Or 2. Labour win - interest rates 10% plus.

Either way house prices are going down. Be patient B)

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Either way house prices are going down. Be patient B)

Yep, in the mean time here's a nice price picture to study....

2007 reality

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| o <-- Penny slowly dropping

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| | Direction to sanity

| |

| V

|

|

|

2012/13 logical outcome based on state of country

Edited by meow

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Either way house prices are going down. Be patient B)

Quokka, meow, neil I hope you are all right. If there are no significant falls over the next year I am going "all in" so to speak.

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Same for me Phoney, got one more year to wait. Can't wait too much longer. Difference is (if I have the guts!) I will be leaving the country and working internationally for a few years and returning when things have cooled. It is sick that going all in or going travelling are our main choices, not good at all.

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Read up about the biggest inter-generational heist in history. And get angry.

445327.jpg

or get hitched like we all did 25 years ago and don't see it as a god given right to be able to afford a house on a single income.

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FYI, I can't speak for the OP or Phoney Greg, but I am married. Not that it is any of your business. It is precisely because I am married and want to start a family that I will not partake in this ponzi economy. Personally, I could 'afford' a house. However, if/when the interest rates rise my life would revolve solely around paying a mortgage. This would seem irresponsible to me.

It really irritates me people who say things like 'you have no right to a house'. Why the hell not? If you work hard are professionally (or not!) qualified refuse to take stupid risks, like many around you, then it is precisely you who do deserve a house.

Take my uncle, nice guy, not too bright, luckily for him he is 12 years older than me so has a nice house yet earns half my salary. Yes I do feel 'entitled' to have at least a house as nice as his. Frankly through a much better work ethic I have out performed him in this rat race of a life.

The difference is not how hard we work, but when we were born. You are goddam right we are angry.

IMO one of the main reasons society has broken down in some areas is because both parents have to work to feed this ponzi corrupt scum scheme.

Greg maybe I have read too much into your seemingly patronising, ill contrived, unsubstantiated statement. Would you care to explain your point further?

When my generation finds its voice things might get interesting. However, the cleverest thing that has been done, and the real reason we appear to have no voice, is to divide us, some of us have bought in to the ponzi. Therefore we are at present difficult to mobilise, as things slowly change so the division will become closer. We paid for your houses, for now, we may not want to pay for your pensions.

Edited by desperate young

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FYI, I can't speak for the OP or Phoney Greg, but I am married. Not that it is any of your business. It is precisely because I am married and want to start a family that I will not partake in this ponzi economy. Personally, I could 'afford' a house. However, if/when the interest rates rise my life would revolve solely around paying a mortgage. This would seem irresponsible to me.

It really irritates me people who say things like 'you have no right to a house'. Why the hell not? If you work hard are professionally (or not!) qualified refuse to take stupid risks, like many around you, then it is precisely you who do deserve a house.

Take my uncle, nice guy, not too bright, luckily for him he is 12 years older than me so has a nice house yet earns half my salary. Yes I do feel 'entitled' to have at least a house as nice as his. Frankly through a much better work ethic I have out performed him in this rat race of a life.

The difference is not how hard we work, but when we were born. You are goddam right we are angry.

IMO one of the main reasons society has broken down in some areas is because both parents have to work to feed this ponzi corrupt scum scheme.

Greg maybe I have read too much into your seemingly patronising, ill contrived, unsubstantiated statement. Would you care to explain your point further?

When my generation finds its voice things might get interesting. However, the cleverest thing that has been done, and the real reason we appear to have no voice, is to divide us, some of us have bought in to the ponzi. Therefore we are at present difficult to mobilise, as things slowly change so the division will become closer. We paid for your houses, for now, we may not want to pay for your pensions.

You do seem a little confused "You have performed better" well obviously not compared to your uncle, if you read my posts I am a technologist and we like things well clear it's a computer thing. He has a nice house on half your salary and you desire one but are whining about it (and he is not too bright how rude about your own flesh and blood) so you obviously haven't performed better....

So your uncle got a break, took a risk or was in the right place at the right time. Welcome to the human race the rules haven't changed for thousands of years. Most of the planet doesn't own a house your choice - no skin of my nose. Your choice you can always rent one from all the BTLer's on here.

Your sense of entitlement smacks of the bleedng heart socialism that has strangled this country for 12 years or more. Now listen up soft lad - no one owes you anything apart from giving you the freedom to earn (which thankfully this country still does) so when you choose to whine and not earn money to satisfy your needs and desires don't blame anyone else.

By the way you wont be funding my pension or millions of self employed people like me if you think we could live on the state pension you are sadly deluded. A final thought you seem very typical of a certain demographic say the 25 -40 age group I might be wrong.

If I was you I would watch out, the generation below you are coming through and if we were Thatcher's b***** children they are the B***** grand children but with a twist, working class guile with private education, some capital and all those connections. Just another little thought for your depressive cocktail coming to a board room near you soon.

You are right you are probably F***** but houses could be the least of your worries.........

Edited by Greg Bowman

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Greg, interesting point of view.

I find it interesting that you assume my age and gender. I find it interesting you assume I am 'soft'. I find it interesting you find the will to work, achieve and desire a house socialist. I find it interesting you think I would rent off a BTL merchant. I find in interesting that you think I have somehow turned on my own flesh and blood, my uncle has no o-levels/gcse's and thinks I am something of a genius, he really is a nice guy we are very close!

I find it interesting that you think luck has anything to do with any of this, it is corruption. I find it interesting you think I am whining and blaming others. I find it interesting you think because the majority of the world doesn't own that I shouldn't want to and that they shouldn't want to.

I find it interesting that you seem to like oppression and long for a feudal system, how strange. If this country has suffered from socialism it is the type that privatises the profits and socialises the losses.

I find the following situation interesting; I am not asking for a house, if I was I would get an 18 yr old girl pregnant and go on benefits. I am asking for a fair shot and the end to corruption.

I find it interesting you think I need to worry about the next generation more than you need to worry about the one beneath you.

I find it interesting that you post on an internet forum and feel the need to insult people.

I find it interesting that you are not an agent of change but a relic.

I find it interesting you assume I am over 25.

Fear is interesting...

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Quokka, meow, neil I hope you are all right. If there are no significant falls over the next year I am going "all in" so to speak.

I would be somewhat surprised if falls don't re-emerge during this year

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Oh do ****** off. How does posting aggressive bile like this help anyone?

Interestingly a lot of his posts seem to smell of the same thing he accuses a lot of young gen-x'ers/gen-y'ers...

Shoulder <- Chip

The younger generations now are facing a mountain to climb, much steeper than ever before, and yeah a lot of them are ill educated whiners who are ill prepared and ill motivated, but it doesn't take away the fact that house prices at the moment are putting hurdles in people lives that should not be there... or at least don't lock you into debt slavery at mental repayment levels forever more

Edited by meow

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Shoulder <- Chip

The younger generations now are facing a mountain to climb, much steeper than ever before,

It's insane to say things like "it's always been hard". Things have got so far out of control. I "missed out" by doing a PhD during 2002-2006 which were the mega boom years. During that time I was renting as it was the cheapest option and I had no support to buy. If I had started my career proper in 2002 I could have bought a far better place than I could buy now just 4 years difference!!

The boomers should have a think about what they earn and whether they could by their house on 3.5 times that. Not too likely in most cases I think.

As for me, the PhD may pay off in the end salary and job security wise, but with houses not going down I will be far worse off than all of my Uncles. This includes the one who could afford a detached house in a nice area of Brighton after being a comprehensive teacher for 3 years*. Those pre the 2002-2006 boom and those after simply are not playing the same ball game.

Phoney

*(nothing against teachers, just that I get paid a fair bit more and could get no where near that)

Edited by PhoneyMcRingRing

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Very good thread, with various points of view.

It is always intriguing to see how the house purchase situation is approached by different people. I have always been a mega-bear on UK housing. Well, since 2006 at least, and in particular, about places like the North East, where the bulk of employment comes from the public sector, with huge numbers of people on the minimum wage or on the dole.

Now that Northern Rock's gone, we are sitting in a limbo where Interest Rates are at the historical low, and keep some over-mortgaged folks (on 15k with a 150k mortgage, interest only of course) in their houses.

We haven't seen the pain yet. It'll come, no doubt., and those who believe that the current prices are sustainable might have to reconsider their positions.

I am personally debt-free, early thirties, on what could be considered by all means a good salary, and yet I could barely afford a basic house. That is, unless I "stretched" myself, as per the original poster's dilemma.

But why would l commit so much of my disposable income to an asset which I can access with far less with rent?

What is supporting the current prices in the North-East? Not wages, Not employment. If you look at the future, I can't see the boom coming back here.

Hence, I am targeting 2012-2013 for a review of my housing needs.

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where the bulk of employment comes from the public sector, with huge numbers of people on the minimum wage or on the dole.

Sacred cows...No culling here

We haven't seen the pain yet. It'll come, no doubt., and those who believe that the current prices are sustainable might have to reconsider their positions.

Nope, "hard working families" must be allowed to stay in "their" homes

I am personally debt-free, early thirties, on what could be considered by all means a good salary, and yet I could barely afford a basic house. That is, unless I "stretched" myself, as per the original poster's dilemma.

Ditto

But why would l commit so much of my disposable income to an asset which I can access with far less with rent?

You sound like an optimistic me!

Phoney

Edited by PhoneyMcRingRing

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Phoney I agree with you that this is what the current government would like to do.

However, I bet the recently elected socialist government in Greece would have stuck to a similar sentiment if they had a choice.

Greece didn't have a choice, Ireland didn't have a choice the UK doesn't have a choice. The difference with the UK is that we haven't realised it yet.

Edited by desperate young

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I would be somewhat surprised if falls don't re-emerge during this year

...and they have

Although if you look at the regional stats in the national indices you may well find that the north east has not really had a mini recovery after the bust. I'm being careful to check the NW/HFX stats every month for the north east figures.

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What annoys me is that I left university in 2003 after having spent a great deal of time and money on education (masters degree, because I couldn't get a job with a bachelors degree). The older generation had told me "Work hard, get an education, and you'll get a good job and be sorted for life"... but that didn't happen. I spent four years being broke and living in crappy halls, working a bar job to cover my rent, in the expectation that my hard work would pay off when I got a job. But when I graduated I couldn't get any job at all despite having two degrees (science and computing), and in the end I got a teaching job paying a pittance.

By that point house prices were already on the rise; I saved from my meagre salary in the hope that prices might fall, but they never did. So I waited, and in the meantime I paid rent to cover someone else's mortgage and dealt with an array of dreadful landlords who refused to repair things, kicked me out of my home at short notice because they wanted to sell up, and caused all other sorts of drama and difficulty. For seven years I lived in various rented flats which were just as crappy as my student accommodation, saving all my pennies instead of spending them on enjoying myself, and watching house prices recede further and further out of my reach, shooting up faster than I could save a deposit.

2010: I'm pushing thirty and have been left university for seven years. My meagre teaching salary hasn't increased a great deal, despite it being a supposedly vital job (although at least I HAVE a job). I'm still not in a position to have a family because I can't provide them with a home due to ridiculous house prices. So I hopefully check out house prices in the area I want to live in... and... they're the same as they were in 2006, and even beginning to rise again slightly :(

The difference is that now I have a small deposit, so I could possibly stretch myself to pay a 100k mortgage. But it's terribly disappointing considering the sacrifice and hard work I've endured since the age of 18 on the promise that everything would work out and I could have a job, and a home, and a family if I just worked hard and followed the formula.

Now I have a dilemma: do I stretch myself to pay that 100k and subject myself to even more years of financial struggle, or do I sit tight like I have been doing and continue to live in crappy rented flats while house prices once again soar out of my reach? I suppose if I buy a house, OK I'll be broke, but at least it'll be my own place to eventually raise a family in and there'll be no dreadful landlords hanging around...

With all due respect to those who say they want to continue to wait for house prices to fall: I've been waiting for most of a decade, saving every penny and living in crappy rented flats, and it becomes annoying after a while, especially if your biological clock is ticking. In 2003 people were saying "Just wait, there'll be a house price crash", and seven years later I'm still waiting for my chance to buy my own home and have a family.

The annoying thing is, my cousin is twenty and has never worked a day in her life; she got knocked up and the council gave her a house... pretty much permanent lease, no interfering landlord, plus money to live on. My other cousin got a job in a call centre right out of school and worked his way up into a management position before I even finished my education (receiving a salary all the time I was struggling to afford to study), bought a house before the prices rocketed too high, and is sitting pretty on several thousand more than I earn with all my degrees. Whereas I did what I was told I was SUPPOSED to do... worked hard and did without to get a good education, got a professional job, worked on my career instead of having illegitimate children and depending on the state... and I'm not as well off as either of my two cousins. I feel betrayed, and lied to, and ripped off :(

University education is a ponzi scam, nothing more and nothing less.

You pay for your own education, get a degree along with millions of others, but there is no premium in a mass system, and thus no uplift in your earnings.

Sad but true. :(

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University education is a ponzi scam, nothing more and nothing less.

You pay for your own education, get a degree along with millions of others, but there is no premium in a mass system, and thus no uplift in your earnings.

Sad but true. :(

The terrible unintended affect is that you now pretty much need a degree for any even half decent job, this is due to the fact that there are so many people fighting for anything that isn't totally crap it's the new base line yard stick...

I would guess that employers look more closely at your classification and the awarding institute too.

Is there such a thing as educational inflation? edu-flation.

Edited by meow

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