Started To Look For Houses - And I'm Staggered

[jmzr]

i've been looking at this site for years, but don't post too much

here's my story

very sadly, i split from my wife 4 years ago. we obviously had to sell the house and so i have rented in the meantime.

i luckily found a great place to rent in a lovely surrey town - the perfect rental house, which i love living in and am renting for a fraction of the cost of buying (£1300pcm for a c.500k house)

however, the people that own it inherited it from their father who passed away, and are now looking to sell...and i know that i will not be able to afford to buy it

having looked at lots of other rentals in the area, they are overpriced and horrible

so, i'm now thinking of buying again with my girlfriend,(who i've known since i was 11 ands who is a great girl)

we've got a good deposit and we're looking at around the 400k mark in the local area

having been tracking market for 3 years, prices just are not moving....and if anything., they are going up

it certainly seems like estate agents are pricing properties way, way above the 2007 highs

i've been using all the normal sources ot look at property and road history and the current prices are insane

like a few on here, i'm now seriously doubting that prices are going to come down - in the surrey area at least

there seem to be enough people willing to pay the insane prices to keep the market up

no estate agents are closing and the one's i've spoken to are still as smug as ever, telling me that low offers will not be considered and that if i don;t buy, then others will

i feel like i've waited a long time for prices to come down now, but the insanity continues

i could keep renting and saving, but even though i'm saving about 10k a year, prices are ging up faster than that

i keep thinking this cannot continue...but it does

houses round here for 400,000 really not worth buying it seems.....

if you were me, what would you do (knowinbg that moving is not an option)

thanks

jmzr

[MattW]

houses round here for 400,000 really not worth buying it seems.....

if you were me, what would you do (knowinbg that moving is not an option)

thanks

jmzr

Carry On Renting.

[scottbeard]

we've got a good deposit and we're looking at around the 400k mark in the local area

having been tracking market for 3 years, prices just are not moving....and if anything., they are going up

it certainly seems like estate agents are pricing properties way, way above the 2007 highs

i've been using all the normal sources ot look at property and road history and the current prices are insane

like a few on here, i'm now seriously doubting that prices are going to come down - in the surrey area at least

there seem to be enough people willing to pay the insane prices to keep the market up

no estate agents are closing and the one's i've spoken to are still as smug as ever, telling me that low offers will not be considered and that if i don;t buy, then others will

I'm in an extremely similar position to you (it's scarily like reading my own post!)

And I feel exactly the same, except in my part of Surrey prices seem about level with 2007 rather than above.

[Havoc]

I've waited for years now. I cant see the crash happening unless some kind of forced sale like interest rates rising but all the signs are they wont and it looks like the BoE have painted themselves into a corner, I could be wrong.

At some point you need to get on with your life.

So how long do you wait?

Yes. I have been waiting for a fall in prices since 2001, ten years later I'm still waiting. There was a time around the summer of 2007 when it looked like prices were going to correct to normal levels but that was only temporary and since then the market has zoomed away again in many parts of the country. I've lost interest, its too late now and I'm too old and bitter!

Edited January 24, 2012 by Havoc

[montesquieu]

I'm in an extremely similar position to you (it's scarily like reading my own post!)

And I feel exactly the same, except in my part of Surrey prices seem about level with 2007 rather than above.

Ditto for the nicer bits of Berkshire.

Am under big wife pressure too.

[Superted187]

Berkshire resident here. Former London resident.

Even though prices are sliding down slowly in Reading, I'm leaving the South East (Don't want to pay £250k to live in Reading tbh).

My partner is from the Midlands so we will be heading that way in August, initially renting but will end up buying at some point.

I can sympathise fully with all posts with concerns about the lack of downward movement in asking prices - its pushed us into relocating.

[Garf]

Am under big wife pressure too.

This and Kenneth Williams in one thread. It's too much.

[scrappycocco]

Completely given up because the agents won't get real, don't know what I'm going to do. I think as long as housing benefit is paying people to live in nice places, I have no chance of getting anywhere affordable and decent.

Don't use your real address for emailing agents, the amount of spam in the email address I use for making offers is untold even the one line stuff with link.

[jmzr]

it's sad and bewildering to see so many people in the same situation

the thing i keep asking myself is 'how is this continuing'. i simply do not understand it

i did (what i believed to be) everything right in life

i worked really hard at school....and got good grades. i then went on to uni..., where i worked hard and got good grades...and where i had two jobs to help finance myself. in the holidays from uni i did factory work and nightshifts...or whatever i could to help pay for my education

i then moved to london and worked my way up through companies

i'm 16 years into my career and currently working at a big blue chip company in a senior management role

similarly, my girlfriend is has a very good law career. she has a 1.5 hour commute to and from work everyday

collectively, our income is very good (and i know we are lucky to earn the salaries that we do...although i also think reflects how hard we have worked over a long period of time)

on top of this we have a 150k deposit, which we have collectively worked very hard to save, making big sacrifices to get too

i've never had a nice car.....the most i ever spent on one was 4k (and that was between the two of us)

i bought my first ever new TV last year, having always had hand-me-downs

i'm not greedy and i don't have high expectations or big demands from a house

i'm not after a tennis court or a swimming pool.......

i don't want to live in london........

i'm not expecting 6 bedrooms or a massive state of the art kitchen

all i want is a nice, modest house, with a small garden...possibly with a bit of character in a decent, safe area

after 16 years of education and 16 years of long hours and stressfull work, i don't think that is too much to ask...?

but seemingly, it is too much to ask.....

who are these people who can buy house at these prices???

what have they done that i have not??

it gets me so angry..........

[Doesn't Commute Anymore]

i did (what i believed to be) everything right in life

i worked really hard at school....and got good grades. i then went on to uni..., where i worked hard and got good grades...and where i had two jobs to help finance myself. in the holidays from uni i did factory work and nightshifts...or whatever i could to help pay for my education

i then moved to london and worked my way up through companies

i'm 16 years into my career and currently working at a big blue chip company in a senior management role

similarly, my girlfriend is has a very good law career. she has a 1.5 hour commute to and from work everyday

collectively, our income is very good (and i know we are lucky to earn the salaries that we do...although i also think reflects how hard we have worked over a long period of time)

on top of this we have a 150k deposit, which we have collectively worked very hard to save, making big sacrifices to get too

i've never had a nice car.....the most i ever spent on one was 4k (and that was between the two of us)

i bought my first ever new TV last year, having always had hand-me-downs

............

all i want is a nice, modest house, with a small garden...possibly with a bit of character in a decent, safe area

after 16 years of education and 16 years of long hours and stressfull work, i don't think that is too much to ask...?

but seemingly, it is too much to ask.....

I relate to a lot of this post, although I'm not as high in deposit.

Really the problem is being born at the wrong time in the economic cycle and not being able to buy into houses pre-HPI. Those leaving school/uni now are also stuck in a similar position in terms of careers, as they will never make up for the lack of opportunity to train/gain a cheap uni education/gain work experience like those a few years older.

There have been lots of previous periods of history where being born at the wrong time made life progress impossible. Being 18-35 at the outbreak of the world wars was the worst deal of all.

Emigration has always been the answer to this from what I have read historically - hence the Irish in the USA, for example.

I think the smartest thing to do for people in this situation, given that buying a house now may mean many years of slow price decline/high inflation/poor employment prospects is seek opportunities abroad. That is my plan.

[Tenubracon]

Transaction volumns are at historical lows, and the only way they'll get back to 'normal' levels is through price drops or a return to free and easy lending. In the mean time sellers will sit tight because they don't want to be the mugs who sell for less than what the Joneses down the road sold for.

[irishcol]

Transaction volumns are at historical lows, and the only way they'll get back to 'normal' levels is through price drops or a return to free and easy lending. In the mean time sellers will sit tight because they don't want to be the mugs who sell for less than what the Joneses down the road sold for.

or what they paid for it....

The concept of the house you're buying having dropped by more seems alien to a lot of people who are looking to trade up. E.g. if (like me) they bought a starter home a few years ago for X, they expect it to be worth X+20% now. Little realising that, if hosue prices had continued to rise year-on-year, the hosue they now want, which would have cost A a few years ago, would now be worth A+20% too, which in absolute £ terms is a bad situation for them. I'd much rather my flat had dropped by 10%, if the larger (more expensive) house I'm now buying has also dropped by 10%.

[Lion]

The reason why people are still buying at ever higher prices is simple - they can still get hold of enough cash, and mortgages are cheap. Usually there is some profit from a previous property, and possibly from savings / family etc. My wife and I were in a similar situation in 2003 - we had been renting for 3 years in North London and did no longer want to pay £750 rent for our small 1 bed flat. So we decided to buy - but prices were too high and we waited, as we were sure a correction was overdue. It did not come. In 2004 we ran out of patience and bought a £180k ex council flat with just £4k cash. Our cash just covered the fees. The 5% deposit was covered by a credit card. Instead of our £750 rent we now had to pay £1k mortgage and had £ 171k mortgage debt and £ 9k credit card debt and no savings whatsoever. The first year was a bit of a struggle.

It was of course risky, but it turned out more than allright. Our wages increased (which we anticipated when we bought it) and we paid off the credit card debt and over the next seven years repaid additionally £30k of our mortgage debt and invested another £15k in a complete refurbishment - from income, not borrowings as the interest part on our mortgage went down to just £130 per month (we had a 0.6% above BOE rate lifetime tracker). Then - in 2011 - we wanted something better and bigger. We put our flat on the market and the interest was unbelievable. There were four visitors on the first day, one offer was £240k from a FTB which we accepted. Never ever was a flat in our road sold at such a high price. Finding a house was more difficult, but in the end we found a nice semi with large southfacing garden in a good area of North London for £475k in need of a bit of refurbishing. HSBC allowed us to port our fantastic 0.6% lifetime tracker to our new property. Our mortage now is £375k, higher than ever, but we feel fairly relaxed about it. We repay £1k of the capital each month and a few hundred pounds in addition in interest - in total we pay still less than we would have to pay to rent this house. My income is dood but would not be enough to buy this house had we not made a good profit with our flat before. Compared to renting, owning the flat made us almost £100k better off due to the low interest rates (so the mortgage was much cheaper than any rent would have been) and the 33% increase in value. Before we bought the opposite was predicted on this site - higher interest rates and lower values. It may still happen, but we were not prepared to put our lives on hold and took some risks.

[okaycuckoo]

The reason why people are still buying at ever higher prices is simple - they can still get hold of enough cash, and mortgages are cheap. Usually there is some profit from a previous property, and possibly from savings / family etc. My wife and I were in a similar situation in 2003 - we had been renting for 3 years in North London and did no longer want to pay £750 rent for our small 1 bed flat. So we decided to buy - but prices were too high and we waited, as we were sure a correction was overdue. It did not come. In 2004 we ran out of patience and bought a £180k ex council flat with just £4k cash. Our cash just covered the fees. The 5% deposit was covered by a credit card. Instead of our £750 rent we now had to pay £1k mortgage and had £ 171k mortgage debt and £ 9k credit card debt and no savings whatsoever. The first year was a bit of a struggle.

It was of course risky, but it turned out more than allright. Our wages increased (which we anticipated when we bought it) and we paid off the credit card debt and over the next seven years repaid additionally £30k of our mortgage debt and invested another £15k in a complete refurbishment - from income, not borrowings as the interest part on our mortgage went down to just £130 per month (we had a 0.6% above BOE rate lifetime tracker). Then - in 2011 - we wanted something better and bigger. We put our flat on the market and the interest was unbelievable. There were four visitors on the first day, one offer was £240k from a FTB which we accepted. Never ever was a flat in our road sold at such a high price. Finding a house was more difficult, but in the end we found a nice semi with large southfacing garden in a good area of North London for £475k in need of a bit of refurbishing. HSBC allowed us to port our fantastic 0.6% lifetime tracker to our new property. Our mortage now is £375k, higher than ever, but we feel fairly relaxed about it. We repay £1k of the capital each month and a few hundred pounds in addition in interest - in total we pay still less than we would have to pay to rent this house. My income is dood but would not be enough to buy this house had we not made a good profit with our flat before. Compared to renting, owning the flat made us almost £100k better off due to the low interest rates (so the mortgage was much cheaper than any rent would have been) and the 33% increase in value. Before we bought the opposite was predicted on this site - higher interest rates and lower values. It may still happen, but we were not prepared to put our lives on hold and took some risks.

Very interesting.

I think it just shows that some win, some lose - but few really want to be in the casino.

[juvenal]

Carry On Renting.

CARRY ON RENTING!

ESTATE AGENT – FRANKIE HOWERD

FTB: KENNETH WILLIAMS

LADY OCCUPANT: BARBARA WINDSOR

EXT. HOUSE PORCH. DAY

The AGENT is having problems getting the door key to fit the lock..

AGENT: I’m sorry. It’s rather stiff…

FTB: Sounds like my lucky day!

AGENT: Buyers are bending over backwards to view this property..

FTB: I’m no stranger to that!

The door finally eases open.

INT. HALL. DAY

The Agent points upwards to the matched chandeliers.

AGENT: A fine antique pair...

They are confronted by the busty LADY OCCUPANT, wearing only a bra and pants.

LADY OCCUPANT: They may be, but I can still shake ‘em about a bit!!

A grand piano gleams in the hall.

FTB: That grand's a nice instrument, but I prefer an old-fashioned cottage upright!

AGENT: I’m not going there….

LADY OCCUPANT: Would you like to inspect my gazebo?!!!

BOTH: Cheeky!!

Etc..

[Lion]

Very interesting.

I think it just shows that some win, some lose - but few really want to be in the casino.

There was some risk, but not really like in a casino. I was sure about a forthcoming pay rise, so we were certain we could repay the credit card debt within the first year (which we did). As it was a zero percent credit card deal for 12 months, we paid no interest on the £9,000 we borrowed on the card (not even a transfer fee). I accept it was not predictable that we would be so much better off by buying, but there was almost no risk to pay more than for renting. The flat we bought would have been £1,000 to rent a month, or £87,000 for the duration of our stay. It was not likely that interest plus possible reduction of house price would ever have cost us so much. In the end the flat cost us over 7.25 years £30,000 interest, £5,000 in service charges, £4,000 buying fees, £6,000 selling fees, £15,000 refurbishment - in total £60,000 costs (or £690/month). As the increase in value happened to be also £60,000, we lived for more than 7 years in a nice flat refurbished to our own taste for absolutley free, which allowed us to have (save) £120,000 in cash for our house purchase (for deposit, stamp duty and other fees).

We could have sold our flat for just £153,000 instead of £240,000 and would still not have been worse off than renting. Only below £153,000 we would have started to make a loss. This was barely a high risk. But of course everybody has to evaluate their circumstances - I was for instance very sure my salary would go up a lot and that my job would be secure for many years to come, which reduced risk on the income side.

[Asheron]

If you buy a house within the next 5 years, it will be the second biggest mistake of your life.

DO NOT BUY A HOUSE

If you fail to take my advice, You will be known as an Idiot.

Keep renting...

Within 2 years you will witness the biggest financial crash in the history of the world.

i've been looking at this site for years, but don't post too much

here's my story

very sadly, i split from my wife 4 years ago. we obviously had to sell the house and so i have rented in the meantime.

i luckily found a great place to rent in a lovely surrey town - the perfect rental house, which i love living in and am renting for a fraction of the cost of buying (£1300pcm for a c.500k house)

however, the people that own it inherited it from their father who passed away, and are now looking to sell...and i know that i will not be able to afford to buy it

having looked at lots of other rentals in the area, they are overpriced and horrible

so, i'm now thinking of buying again with my girlfriend,(who i've known since i was 11 ands who is a great girl)

we've got a good deposit and we're looking at around the 400k mark in the local area

having been tracking market for 3 years, prices just are not moving....and if anything., they are going up

it certainly seems like estate agents are pricing properties way, way above the 2007 highs

i've been using all the normal sources ot look at property and road history and the current prices are insane

like a few on here, i'm now seriously doubting that prices are going to come down - in the surrey area at least

there seem to be enough people willing to pay the insane prices to keep the market up

no estate agents are closing and the one's i've spoken to are still as smug as ever, telling me that low offers will not be considered and that if i don;t buy, then others will

i feel like i've waited a long time for prices to come down now, but the insanity continues

i could keep renting and saving, but even though i'm saving about 10k a year, prices are ging up faster than that

i keep thinking this cannot continue...but it does

houses round here for 400,000 really not worth buying it seems.....

if you were me, what would you do (knowinbg that moving is not an option)

thanks

jmzr

[24gray24]

If you buy a house within the next 5 years, it will be the second biggest mistake of your life.

DO NOT BUY A HOUSE

If you fail to take my advice, You will be known as an Idiot.

Keep renting...

Within 2 years you will witness the biggest financial crash in the history of the world.

+1.

You will end up being the greater fool, right at the end of the boom, with the headlines of "euro collapse possible", "2012 will be difficult", "another Lehmans event" all not telling you anything.

Yes, London hasn't fallen yet, price wise. But someone has to take a huge loss, because £300,000 (£600,000 including the interest) for an East end slum property just isn't sustainable.

Why shouldn't it be you?

[AC44]

To the first poster:

If you can save 1K each month and have 150K , it is only a matter of waiting for the right time and the right place.

Just hold on to your money, cut costs and find somewhere nice to rent.

My tactic is to diversify my savings into other coins/commodities. It is obvious that the pound is going down so time to diversify.

In the end UK could be in worse situation than we think so..

http://ftalphaville.ft.com/blog/2012/01/24/848051/go-directly-to-the-ecb-do-not-pass-go-do-not-collect-e200/

Painful indeed. Though, in Chen’s opinion quite necessary, since the contraction will eventually increase the resilience of the system — a weeding out of rehypothecation practices which should never have been allowed in the first place, if you will.

So who’s most exposed to this continued repo deleveraging?

According to Chen, in Britain, it’s clearly the major repo dealers — the biggest being Barclays, followed by HSBC and then RBS.

[Bug16]

DO NOT BUY A HOUSE

If you fail to take my advice, You will be known as an Idiot.

Keep renting...

Within 2 years you will witness the biggest financial crash in the history of the world.

And every year the "date of doom" from the many mystics on this site gets shifted each year and still nothing really happens that effects the UK house price insanity by a large margin.

See you in two years.

[AC44]

not in London, but it is happening everywhere else.

[guitarman001]

Emigration has always been the answer to this from what I have read historically - hence the Irish in the USA, for example.

I think the smartest thing to do for people in this situation, given that buying a house now may mean many years of slow price decline/high inflation/poor employment prospects is seek opportunities abroad. That is my plan.

Something I've long mulled about. Unfortunately I need another few years worth of experience. Problem is with my job, houses are expensive in most same areas. E.g. over in Silicon Valley or in Austria.

[guitarman001]

it's sad and bewildering to see so many people in the same situation

the thing i keep asking myself is 'how is this continuing'. i simply do not understand it

i did (what i believed to be) everything right in life

i worked really hard at school....and got good grades. i then went on to uni..., where i worked hard and got good grades...and where i had two jobs to help finance myself. in the holidays from uni i did factory work and nightshifts...or whatever i could to help pay for my education

i then moved to london and worked my way up through companies

i'm 16 years into my career and currently working at a big blue chip company in a senior management role

similarly, my girlfriend is has a very good law career. she has a 1.5 hour commute to and from work everyday

collectively, our income is very good (and i know we are lucky to earn the salaries that we do...although i also think reflects how hard we have worked over a long period of time)

on top of this we have a 150k deposit, which we have collectively worked very hard to save, making big sacrifices to get too

i've never had a nice car.....the most i ever spent on one was 4k (and that was between the two of us)

i bought my first ever new TV last year, having always had hand-me-downs

i'm not greedy and i don't have high expectations or big demands from a house

i'm not after a tennis court or a swimming pool.......

i don't want to live in london........

i'm not expecting 6 bedrooms or a massive state of the art kitchen

all i want is a nice, modest house, with a small garden...possibly with a bit of character in a decent, safe area

after 16 years of education and 16 years of long hours and stressfull work, i don't think that is too much to ask...?

but seemingly, it is too much to ask.....

who are these people who can buy house at these prices???

what have they done that i have not??

it gets me so angry..........

Top post!

[guitarman001]

If you buy a house within the next 5 years, it will be the second biggest mistake of your life.

DO NOT BUY A HOUSE

If you fail to take my advice, You will be known as an Idiot.

Keep renting...

Within 2 years you will witness the biggest financial crash in the history of the world.

+1 and if not, emigrate. Even just for better weather and a bit of an adventure in this thing we call life.

[MattW]

CARRY ON RENTING!

ESTATE AGENT – FRANKIE HOWERD

FTB: KENNETH WILLIAMS

LADY OCCUPANT: BARBARA WINDSOR

EXT. HOUSE PORCH. DAY

The AGENT is having problems getting the door key to fit the lock..

AGENT: I'm sorry. It's rather stiff…

FTB: Sounds like my lucky day!

AGENT: Buyers are bending over backwards to view this property..

FTB: I'm no stranger to that!

The door finally eases open.

INT. HALL. DAY

The Agent points upwards to the matched chandeliers.

AGENT: A fine antique pair...

They are confronted by the busty LADY OCCUPANT, wearing only a bra and pants.

LADY OCCUPANT: They may be, but I can still shake 'em about a bit!!

A grand piano gleams in the hall.

FTB: That grand's a nice instrument, but I prefer an old-fashioned cottage upright!

AGENT: I'm not going there….

LADY OCCUPANT: Would you like to inspect my gazebo?!!!

BOTH: Cheeky!!

Etc..

Brilliant!

Edited January 28, 2012 by MattW