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Started To Look For Houses - And I'm Staggered


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#16 Lion

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Posted 24 January 2012 - 11:18 PM

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.

#17 Asheron

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Posted 24 January 2012 - 11:51 PM

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


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#18 24gray24

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Posted 25 January 2012 - 01:49 AM

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?
2012 prediction:

banks fall like dominoes in 2013, as funds are withdrawn into PMs.

Sarkozy, Obama and Merkel all fall from power.

the british housing crash is not gradual and slow, it drops like a stone on the day interest rates rise.

#19 AC44

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Posted 25 January 2012 - 11:34 AM

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....t-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.


#20 Bug16

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Posted 25 January 2012 - 01:36 PM

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. ;)
Mind the oranges Marlon!

#21 AC44

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Posted 25 January 2012 - 03:13 PM

not in London, but it is happening everywhere else.

#22 guitarman001

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Posted 28 January 2012 - 10:44 AM

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.

#23 guitarman001

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Posted 28 January 2012 - 10:45 AM

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!

#24 guitarman001

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Posted 28 January 2012 - 10:50 AM

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.

#25 MattW

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Posted 28 January 2012 - 10:59 AM

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! :lol: :lol: :lol:

Edited by MattW, 28 January 2012 - 11:00 AM.

Insecure Tenant

#26 leigh delamere

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Posted 28 January 2012 - 11:42 AM

One of my thoughts about why asking prices can remain so high is that in an illiquid marked such as housing it only takes one buyer to pay the asking price in order to set the "going rate".

Our last house was in a new-build estate, with lots and lots of virtually identical just-about-detached 3 & 4 bed houses. If Mr & Mrs Smith sold theirs last week for £260k, then this information will be relayed to Mr 7 Mrs Jones by their Estate Agent if they put theirs on the market next week.

Where it would get interesting is if all of a sudden 5 or 6 similar houses went up for sale, and one or two of the sellers really had to move quick, i.e. forced sale.

#27 Bramblepicker

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Posted 30 January 2012 - 12:56 PM

I understand the pain of trying the buy in the SE.

We got well and truly stung on our first home. Just sold it for £20k less than we paid... in 2003! Admittedly it was overpriced back then but we were desperate for a home and naive.

Anyway, we're chain free now, and only have a small depost so need to come in under £250k to avoid the higher stamp duty. Found somewhere we love in south herts and put an offer in of £249,999 today for an asking price of £279,999. It was refused, and the agent asked whether we could afford more, when I'd already told her it was our first and final as we aren't in the habit of mucking someone around.

We'll see if anything happens, but I thought it a fair offer and we were upfront about it being our limit. Perhaps they're testing us, but we'll see. As we all know, 10% is the average accepted offer reduction.

There's many more fish in the sea! Trying to not let my heart rule my head and use the leverage of a falling market and chain free status, but the SE does seem pretty immune. Issue of lack of stock on the market is artificially inflating things too.

#28 irishcol

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Posted 30 January 2012 - 03:37 PM

I understand the pain of trying the buy in the SE.

We got well and truly stung on our first home. Just sold it for £20k less than we paid... in 2003! Admittedly it was overpriced back then but we were desperate for a home and naive.

Anyway, we're chain free now, and only have a small depost so need to come in under £250k to avoid the higher stamp duty. Found somewhere we love in south herts and put an offer in of £249,999 today for an asking price of £279,999. It was refused, and the agent asked whether we could afford more, when I'd already told her it was our first and final as we aren't in the habit of mucking someone around.

We'll see if anything happens, but I thought it a fair offer and we were upfront about it being our limit. Perhaps they're testing us, but we'll see. As we all know, 10% is the average accepted offer reduction.

There's many more fish in the sea! Trying to not let my heart rule my head and use the leverage of a falling market and chain free status, but the SE does seem pretty immune. Issue of lack of stock on the market is artificially inflating things too.


As you (and hopefully the vendor) probably know very well, due to the badly thought out way in which stamp duty works, any thing with an asking price close to the stamp duty threshold is asking for an offer just beneath the threshold. I think you've done the right thing by putting in a single offer right at the limit, as it shows you're keen but also not likely to make any counter offer if it's rejected (simply because you can't "afford" to, based on the extra £5k stamp duty it would cost).

I would just tell the estate agent that you will leave the offer on the table, but will continue to view other houses - possibly even view another one he has up for sale. The hope is that a) you find somewhere better / cheaper, or B) the vendor realises (or is told by the EA) that he risks missing out on a buyer in a great position and comes back to you to accept.

Where and what exactly are you looking to buy?

#29 Bramblepicker

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Posted 04 February 2012 - 05:06 PM

Well, that house we liked has now been snapped up by someone who offered in the 270's according to the agent. Was more than we were prepared to offer if we'd gone back so will keep looking. Shocked people are getting so close to asking!

#30 inflating

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Posted 04 February 2012 - 06:37 PM

Well, that house we liked has now been snapped up by someone who offered in the 270's according to the agent. Was more than we were prepared to offer if we'd gone back so will keep looking. Shocked people are getting so close to asking!


Well, they could be telling the truth - but fwiw last yr I was looking at houses as well as flats. Got the same sort of knock-back after I offered. But surprise surprise the property wasn't sold at that higher price after all and is unsold months later, guess they'd probably jump at my offer now if I got back in touch with them

Edited by inflating, 04 February 2012 - 06:38 PM.





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