Str Big Regrets

[runforthehills]

As much as I believe in having no regrets I have just faced it. I sold my flat in 2005 as it wasn't big enough for my growing family and decided to move areas (better) and rent for a 'couple of years'. The average price since I moved here has gone up £69K since. Everyone said "rent out the flat DON'T sell it, but I was too scared. It has gone up in value about 40k and i could have paid off 25k more of the mortgage. I could actually be making a profit of about £500 per month right now on it!!

This is the reality. Plus points are: I made about 20k on the sale of the flat and have added another 25k of savings to it. IT IS NOT ENOUGH to get anything in the new area! We are now struggling for work free lancers and the value of our savings are now shrinking as prices are rising here and we don't get much interest at all. Rent is expensive.

People. I made a mistake. I take responsilbilty for it. Is anyone else going to come out and admit they were an idiot?

OK so NewLiebor didn't do what they were supposed to do. This is the lesson. Events do not follow patterns. You CANNOT predict the markets!!

F***** depressed.

[Confounded]

.

Edited April 5, 2010 by Confounded

[runforthehills]

Hey at least you have quantified and recognised the issue, its not as bad as you think it never is, as long as your health is okay and it sounds that you need some help with the mental aspect before it becomes an issue. Been there, done that.

Yep. It already is an issue... at least my partner is cool about the whole thing, we love where we live now, our son is in a good school blah blah! But I feel like all this knowledge has just served to make me frikkin unhappy. Wheras people around me who have no knowledge, no fears, have lucked out, and have mortgages that are peanuts. My dad was right, by luck, he had no idea that the economy was going down, and that then the govs were going to do what they did with the interest rates and the QE. Health is fine, have savings, still utterly utterly peed off.

[up2late]

Chin up, lad

It's better to be out wishing you were in than in wishing you were out.

[Bruce Banner]

People. I made a mistake. I take responsilbilty for it. Is anyone else going to come out and admit they were an idiot?

Not me, I couldn't be happier as I was saying the other day.

http://www.housepricecrash.co.uk/forum/index.php?showtopic=139985&view=findpost&p=2457525

[uncle_monty]

Yep. It already is an issue... at least my partner is cool about the whole thing, we love where we live now, our son is in a good school blah blah! But I feel like all this knowledge has just served to make me frikkin unhappy. Wheras people around me who have no knowledge, no fears, have lucked out, and have mortgages that are peanuts. My dad was right, by luck, he had no idea that the economy was going down, and that then the govs were going to do what they did with the interest rates and the QE. Health is fine, have savings, still utterly utterly peed off.

Take heart RFTH. The game that is HPI-HPC still has many phases left. Let's see what the new government, spending cuts, tax rises, QE, SLS, etc. bring in the next 6-12 months.

The Fat Lady hasn't even warmed up yet.

Monty

PS I am also an STRer. It is natural to waver from time to time.

[Where is my pen?]

As much as I believe in having no regrets I have just faced it. I sold my flat in 2005 as it wasn't big enough for my growing family and decided to move areas (better) and rent for a 'couple of years'. The average price since I moved here has gone up £69K since. Everyone said "rent out the flat DON'T sell it, but I was too scared. It has gone up in value about 40k and i could have paid off 25k more of the mortgage. I could actually be making a profit of about £500 per month right now on it!!

This is the reality. Plus points are: I made about 20k on the sale of the flat and have added another 25k of savings to it. IT IS NOT ENOUGH to get anything in the new area! We are now struggling for work free lancers and the value of our savings are now shrinking as prices are rising here and we don't get much interest at all. Rent is expensive.

People. I made a mistake. I take responsilbilty for it. Is anyone else going to come out and admit they were an idiot?

OK so NewLiebor didn't do what they were supposed to do. This is the lesson. Events do not follow patterns. You CANNOT predict the markets!!

F***** depressed.

this is sad but true!

the fault with hpc was failure to recognise that markets exist at the sufferance of government. markets depend on government and thus are ultimately controlled by them.

sad but true.

[19 year mortgage 8itch]

Boo-******ing-hoo. Grow some balls and get on with your life.

[Anne_Uumellmahaye]

As much as I believe in having no regrets I have just faced it. I sold my flat in 2005 as it wasn't big enough for my growing family and decided to move areas (better) and rent for a 'couple of years'. The average price since I moved here has gone up £69K since. Everyone said "rent out the flat DON'T sell it, but I was too scared. It has gone up in value about 40k and i could have paid off 25k more of the mortgage. I could actually be making a profit of about £500 per month right now on it!!

This is the reality. Plus points are: I made about 20k on the sale of the flat and have added another 25k of savings to it. IT IS NOT ENOUGH to get anything in the new area! We are now struggling for work free lancers and the value of our savings are now shrinking as prices are rising here and we don't get much interest at all. Rent is expensive.

People. I made a mistake. I take responsilbilty for it. Is anyone else going to come out and admit they were an idiot?

OK so NewLiebor didn't do what they were supposed to do. This is the lesson. Events do not follow patterns. You CANNOT predict the markets!!

F***** depressed.

Shouldn't this has been posted in 2007?

This is when you would have seen the flat you sold at it's peak?

Now you should have seen the "value" of the flat fall since then.

And now I just see a completely stagnant market post falls with the start of serious increases in supply.

(Or are you in London?)

[runforthehills]

Boo-******ing-hoo. Grow some balls and get on with your life.

Perhaps you have some spare testosterone I can use?

My life is fuller than you can imagine! I still have time to ponder my housing situation. I am a woman of action, and find it hard to live with the consequences sometimes, but, as they say, gotta take the rough with the smooth. Still doesn't make it any easier though, UK is a very scary place ATM, don't you think! What's your situation btw?

[Georgia O'Keeffe]

As much as I believe in having no regrets I have just faced it. I sold my flat in 2005 as it wasn't big enough for my growing family and decided to move areas (better) and rent for a 'couple of years'. The average price since I moved here has gone up £69K since. Everyone said "rent out the flat DON'T sell it, but I was too scared. It has gone up in value about 40k and i could have paid off 25k more of the mortgage. I could actually be making a profit of about £500 per month right now on it!!

This is the reality. Plus points are: I made about 20k on the sale of the flat and have added another 25k of savings to it. IT IS NOT ENOUGH to get anything in the new area! We are now struggling for work free lancers and the value of our savings are now shrinking as prices are rising here and we don't get much interest at all. Rent is expensive.

People. I made a mistake. I take responsilbilty for it. Is anyone else going to come out and admit they were an idiot?

OK so NewLiebor didn't do what they were supposed to do. This is the lesson. Events do not follow patterns. You CANNOT predict the markets!!

F***** depressed.

i think what it highlights is markets are extremely difficult to "Time" correctly (rather than predict where they ultimately have to go). But then if that wasnt true everyone would be loaded. They can reach extreme valuations to both the overside and underside and stay there for years. The prices can have no bearing in reality but they can still bankrupt you for being too early which is why its pretty fundamental to wait for a break rather than catching the exact top or bottom.

Seems the main problem with this site is it was created in 2004, when there was no technical reason to be bearish, (although from a fundamental point of view there was plenty). Like watching the Nasdaq in 1999 still powering forward in 2000 on nothing more than hot air.

As for the govt, they are as much a part of the market as everyone else and they should always be viewed as such. From my perspective i believe the markets (all of them, equities, housing, commodities) are behaving and forming in a natural and textbook way so far, in the uks case it is in fact govt action that is creating this textbook rally . Everyone makes there own choices and has to live with them i guess, its quite often that luck is just as useful as intelligence in markets.

Not really that helpful i know but thats just reality, people probably shouldnt play markets actively unless they have an exact management plan mapped out on every play and they have to understand there is no harm in being wrong, its far healthier than not realising they are wrong and not trying to understand the reasons why.

[Confounded]

Before finding this site I thought property had peaked in 04 and that after the 05 election Labour would deflate the bubble in time for the next election for it to be in the recovery phase. This was gut feeling and based on limited reading around the subject. If you look at the graph below the market did reach a natural peak in 04.

I was waiting to upsize from my 2 bed starter home and decided to take a career brake (with my wife) and go travelling (stake out alternative countries to live in) end 05-06 and thought when I returned the correction would be in full swing. Once I realised Labour were going for broke I set an insane upper price for my 2 bed in the Midlands. It reached that price late 07 when I sold. I am just glad I had not read more around the topic and found this site in the early days as I am sure I would have been convinced to sell in 05 so do not be hard on yourself.

We are in an insane bubble as demonstrated by the current return to normal phase. We a just 1 year from the nadir and it is as if nothing has happened (could there be an election coming?). As a bear the current phase is as tough as it was in summer 07 after I had sold in the spring and the insanity continued. However our current rental costs are a gross yield of 2.7% against our money receiving 4.5% so financially things stack up at the moment but if prices have not resumed their downward trend in Autumn of this year it will be clear the political plan has not changed.

By selling in 07 it has given us the flexibility to move to Devon where my wife grew up so we were close to her family to support her Mum look after her Dad who had cancer (she was able to be by his side when he passed away something you can not put a price on). We have the flexibility to move again or as we hope to do make a go of living in an area with low job opportunities. Having money in the bank is very reassuring.

To give you hope the graph below will correct sharply either through improved wages or falling prices, my bet is still with prices. Also remember the area under the graph is very important in bubbles because it shows how many people have been caught paying bubble prices. This is the biggest bubble of all time thanks to government intervention.

Income to house price ratio

[A_Landlord]

Not me, I couldn't be happier as I was saying the other day.

http://www.housepricecrash.co.uk/forum/index.php?showtopic=139985&view=findpost&p=2457525

I have the opposite story by not STR - we had a good offer on our property (which has no mortgage) in Feb 2008, but decided not to sell due to our target house being too expensive. Now 2 years on our house is worth maybe at most 20k less, but probably still very close to the same previously agrees price. But we have saved ourselves 2 years worth of rental payments (+30k), moving costs and minimum bank interest on the sale plus have kept living in the comfort of our first home of 12 years with no uncertainty from having a landlord.

We have made the decision to stay and put our child into private primary schooling (we live on the wrong side of town), rather than pay a +300k premium to move into a good school catchment area. Hopefully in 2 years time the correction will finally have happened and it would have cost us 2 or 3 years school fees, but saved us many more 00,000s.

Again, another person happy with the decision they have made.

[runforthehills]

Shouldn't this has been posted in 2007?

This is when you would have seen the flat you sold at it's peak?

Now you should have seen the "value" of the flat fall since then.

And now I just see a completely stagnant market post falls with the start of serious increases in supply.

(Or are you in London?)

Yes I am in London, I think i did post something similar around that time when the guy who i sold the flat to did it up and made a big mark up after it being on the market for a year or so. I got told off then by bubb etc, for not having faith in the crash, and to wait it out and stop being such an impatient young tike. I am feeling like a grade A chump right now. I think it's important to share what has happened. I will find it very hard getting another mortgage, my partner and i are both self employed. Even if things are stagnant round here, it will be very difficult to find anything. And we don't get the FTB stamp duty holiday! B******* Now I know how people turn into grumpy old women.

[Bruce Banner]

I have the opposite story by not STR - we had a good offer on our property (which has no mortgage) in Feb 2008, but decided not to sell due to our target house being too expensive. Now 2 years on our house is worth maybe at most 20k less, but probably still very close to the same previously agrees price. But we have saved ourselves 2 years worth of rental payments (+30k), moving costs and minimum bank interest on the sale plus have kept living in the comfort of our first home of 12 years with no uncertainty from having a landlord.

We have made the decision to stay and put our child into private primary schooling (we live on the wrong side of town), rather than pay a +300k premium to move into a good school catchment area. Hopefully in 2 years time the correction will finally have happened and it would have cost us 2 or 3 years school fees, but saved us many more 00,000s.

Again, another person happy with the decision they have made.

You may have saved £30K in rental payments, but you have lost out on the interest that you would have earned had you sold a mortgage free house and banked the money. In my case, it has been a lot more than that paid out in rent.

As for having a landlord, I have no complaints, mine treats me as a valued customer.

[Georgia O'Keeffe]

Shouldn't this has been posted in 2007?

This is when you would have seen the flat you sold at it's peak?

Now you should have seen the "value" of the flat fall since then.

And now I just see a completely stagnant market post falls with the start of serious increases in supply.

(Or are you in London?)

Yes I am in London, I think i did post something similar around that time when the guy who i sold the flat to did it up and made a big mark up after it being on the market for a year or so. I got told off then by bubb etc, for not having faith in the crash, and to wait it out and stop being such an impatient young tike. I am feeling like a grade A chump right now. I think it's important to share what has happened. I will find it very hard getting another mortgage, my partner and i are both self employed. Even if things are stagnant round here, it will be very difficult to find anything. And we don't get the FTB stamp duty holiday! B******* Now I know how people turn into grumpy old women.

i think the other important point you mention is you are "struggling" freelancers, forgetting the market timing issues taking on a mortgage that is just about affordable when your supply of work is on a downer could be far more fatal than anything else. The govt are clearly creating a sh!tstorm of further malinvestment in the UK for their own political reasons, i wouldnt feel comfortable buying myself in that position because i know if houseprices do head down again its going to create an economic nightmare in the UK and the deflationary impact on the wider economy will most likely add millions more the unemployment roster.

[singlemalt]

I suppose it's all about timing. I can see how someone who STR in 2005 might be looking back with regret.

Hindsight can be a wonderful thing but calling the game when nobody actually knows whether we're 1/4, 1/2 or even just 1/8 into it doesn't make sense.

[A_Landlord]

You may have saved £30K in rental payments, but you have lost out on the interest that you would have earned had you sold a mortgage free house and banked the money. In my case, it has been a lot more than that paid out in rent.

As for having a landlord, I have no complaints, mine treats me as a valued customer.

You have done well that in this climate your interest cancels out your rent and I'm glad there are some on HPC who value Landlords!

For me, after paying tax on any interest gained, the bank interest rates of the past 2 year, plus having to hold multiple bank accounts of less than 50k, and not wanting to go any further into shares, I am happy to have just saved myself 30k. Atleast I am still in my home but having to play the waiting game for the HPC.

[aussieboy]

You may have saved £30K in rental payments, but you have lost out on the interest that you would have earned had you sold a mortgage free house and banked the money. In my case, it has been a lot more than that paid out in rent.

As for having a landlord, I have no complaints, mine treats me as a valued customer.

Quite,

Moreover, the prior poster missed out on imputed rent., the bane of the taxman.

[Anne_Uumellmahaye]

Shouldn't this has been posted in 2007?

This is when you would have seen the flat you sold at it's peak?

Now you should have seen the "value" of the flat fall since then.

And now I just see a completely stagnant market post falls with the start of serious increases in supply.

(Or are you in London?)

Yes I am in London, I think i did post something similar around that time when the guy who i sold the flat to did it up and made a big mark up after it being on the market for a year or so. I got told off then by bubb etc, for not having faith in the crash, and to wait it out and stop being such an impatient young tike. I am feeling like a grade A chump right now. I think it's important to share what has happened. I will find it very hard getting another mortgage, my partner and i are both self employed. Even if things are stagnant round here, it will be very difficult to find anything. And we don't get the FTB stamp duty holiday! B******* Now I know how people turn into grumpy old women.

You have a growing family and nigh on 50k of savings- sound pretty good to me!

Also, as everyone points out- these are bizarre times due to the election.

Maybe we need to dig out this thread when we are well in to the second half of the year and providing your work situation is still looking good- you may find yourself in a much better position.

Enjoy your family, security and flexibility- many will find that their home ownership is a millstone round their necks.

[runforthehills]

ame='runforthehills' date='05 April 2010 - 08:51 AM' timestamp='1270453879' post='2460763']

i think the other important point you mention is you are "struggling" freelancers, forgetting the market timing issues taking on a mortgage that is just about affordable when your supply of work is on a downer could be far more fatal than anything else. The govt are clearly creating a sh!tstorm of further malinvestment in the UK for their own political reasons, i wouldnt feel comfortable buying myself in that position because i know if houseprices do head down again its going to create an economic nightmare in the UK and the deflationary impact on the wider economy will most likely add millions more the unemployment roster.

Yes, you are quite correct. I know the only reason I have as much work as I do is due to people having 'a breather' with the low interest rates, and a false economy being at work. god knows what it is going to be like when reality truly hits. I am working as hard as I can to be top of the tree in my field. Buying now would be suicide, unless a real bargain comes up. What is going to happen to this country? I have a US passport. My brother lives in Hawaii. I still love this place to bits, but where are we heading after the election?

[Bruce Banner]

You have done well that in this climate your interest cancels out your rent and I'm glad there are some on HPC who value Landlords!

For me, after paying tax on any interest gained, the bank interest rates of the past 2 year, plus having to hold multiple bank accounts of less than 50k, and not wanting to go any further into shares, I am happy to have just saved myself 30k. Atleast I am still in my home but having to play the waiting game for the HPC.

During the period, I've received up to 7% interest and it has averaged about double what I pay out on rent. Currently it's about 4%, but I expect it to rise later this year. Also, I changed half my money into EUR in 2007 when exchange rate was 1.5 EUR/GBP, currently 1.1 EUR/GBP.

Tax? We all have to pay tax, surely you pay tax on you income as a landlord?

[Bloo Loo]

Take heart RFTH. The game that is HPI-HPC still has many phases left. Let's see what the new government, spending cuts, tax rises, QE, SLS, etc. bring in the next 6-12 months.

The Fat Lady hasn't even warmed up yet.

Monty

PS I am also an STRer. It is natural to waver from time to time.

bet he wasnt wavering in 2008.

FEAR is the driver here....fear of missing out.

[A_Landlord]

Tax? We all have to pay tax, surely you pay tax on you income as a landlord?

Don't worry, I'm clean on my tax return. Plus the management agency has to declare what rental income I receive, so HMRC get notified in duplicate and all tax is paid.

[Muskoka]

Many of us are STR's from various years, me included. Much as the market has not done what was anticipated,try to look on the bright side. At least we're not the ones with our whole lifetimes in an unmanagable amount of debt. There is a silver lining there - somewhere -

God above knows what will happen post - election. My expectation (which horrifies me), is that the conservatives get in which will restore confidence to the market & then hey, ho prices go up even more. The U.K. is in an unprecedented mess for the foreseeable future. Hopefully someone will be along to tell me I'm talking a whole load of tosh. I hope I'm utterly wrong