Hi,

I've actually come really close to considering buying at the moment (June 2008), thinking it was a good time as competition for flats and houses is probably quite low at the moment (understatement..). First time buyer, late twenties, f all deposit etc. So definitely not strong on the fincial side. Earning roughly 23-26K a year (plus my own business on the side but that income doesn't count mortgage wise).

Do you guys have any data on new developments dropping prices? Such as Gladedale, George Wimpey, Barrat and so forth? Am I stupid even considering them at all, and most definitely now the way the market is going?

More specifically I was looking to buy a 132k 2 bedroom flat around the Hunter's Edge development in north Wallsend (close to work) but I think I got cold feet after reading Pacific State's list of house price drops in NE1 (and surrounding areas?). I think I've realised that is over priced as f*ck.

Just wanted to say this is a great bloody forum and I wish I had found it earlier!

Matt

Hi Matt,

Good to welcome a fellow Geordie here.

We all have our own views on property and the way it is going. I've been predicting a HPC for about 4 years now and ask any of my friends, I have been wrong for most of that time! So, it's important to state that I am not a property expert and my views may be complete rubbish.

Reports seem to suggest in the national press that developers will allow up to 20% off whatever the advertised price is. However, that will vary builder by builder so there's no guarantee of it.

If you have no deposit, the chances of finding a mortgage are, apparently, quite small. You may be able to get a "gifted deposit" for a new-build but be very wary.

My main areas of interest are NE1, NE8 (Gateshead) and NE11 (Dunston). I have no data that I have tracked for Wallsend but it may be fair to suggest that the drops there will be larger because it is further away from Newcastle.

I would certainly not buy at the moment and would probably hold off until 2011-2012. If you have spare cash left over at the end of the month, put it into a savings account and build your deposit for when prices are near their historical average.

That said, opinions are like a-r-s-e-holes - everyone has one. And mine ain't won no beauty parades lately!

My advice

2008: Bank <- Your money
2010-11: Bank -> Your Money -> House

Hi,

to be honest I would avoid Hunter's edge, at ANY price, but especially at 132k. My useless advice is, sit and wait.

Why would you want to buy a house when the crash has only just STARTED?

That 100k flat today might be going for 60k in a few years time .... can you stomach that?

What if

- You cant remortgage when teaser periods are up and onto other loans where the LTV's are 80-90%
- Your bank asks you to take a loan out to cover negative equity
- You can spend the same money in a few years and get something MUCH better
- Places that look fairly 'cheap' now, end up being no-go council ghettos in the future.
- You get laid off over the next few years due to a downturn in the economy


Seriously, the smart money is waiting patiently on the sidelines right now. In face you are 'making' more money by giving rent to a landlord, than you would be by owning a property? If your aim in life is to get ahead then why knowingly LOSE money.


Remember, back in 1998-1999 you could get a 3 bedroom house for 60 grand on bensham bank - new. Those same houses are 160k now ..... they'll go back to that if this thing plays out like it looks like its doing.

Lived at Windmill Way on Bensham bank, new build.

Horrible houses poorly built, the wind up there took the ridge off every so often. Windows were tatt, drafty crap and the finish inside was poor.

I wouldn't buy one, nice to be so close to town mind.

Cheers for the feedback.

Didn't actually know you'd get messed about by the lender if you ended up in negative equity. Interesting.

I just started looking into buying this week basically, and I am more and more realising it can go a lot more downhill.

My reasoning was, considering I have no despoit, to capitalise on the "desposits paid", shared equity and so forth. However, given the reasonably gloomy predictions on the market - it's probably a safe bet to continue renting for some time. I just live in Jesmond and it's full of student bastards, I need to get out

Try Bensham, nr Saltwell Park, in Gateshead. I lived there for four years and loved my time there. £5-7 taxi fare into town.

Aye, but you would you want to "walk" through bensham on a night?

I drive past there a couple of times per week. My girlfriend lives in whatever that place is called beyond it. Festival Park. Around Saltwell Park it okey though, like you say.

Some parts of Bensham is rough as F though, and I work on the Newcastle side of the river and the Tyne Bridge will do my head in on the way back from work every day...

And I need to save up a desposit anyway. Oh well, guess it's me against the students for a bit longer!

Festival park is an oddity, it's essentially stuck between teams, bensham, lobley hill and near an industrial estate and the a1 and really "should" be a shit hole, but if you can overlook the lack of cat swinging activity inside the houses it's actually not bad, dare I say it "rather nice", a real old school 80s-90s "new" build estate where it's slightly set away from the crapper areas and the only reason you'd drive or walk in is to go to a house in that estate.

I have a "fondness" for festival park, I do declare.

P.s. Prices down roughly 15% from peak too *touches nose*

p.p.s. They still need to go about at least 35-40% before being worth it, possibly more! They are quite small, have a look at 2000 prices in houseprices.co.uk if you want to see how mentally overinflated they are.

Gf bought a two bed semi for 150 or so. Will have a look at site later!

I never felt threatened walking through Bensham at night, but tbh I rarely feel threatened outdoors. I always thought its reputation undeserved soon after moving in.

That said, a couple of ex-girlfriends didn't particularly like it but I think they might have had the Geordie WAF/Princess complex.



I lived up just by Saltwell Park and it was very nice.

I work in Newcastle and the drive across is a bit of a pain, admittedly.

anything off the streets of saltwell road is pretty horrid, very much so the streets close to the train line (sure they transport nuke waste along that too)

however the chinese takeaway is great, and super pies on coatsworth road is top.

hey if your thinking of buying in the area these are top tips

The streets off Saltwell Road are a bit ropey.

However, as you go up Whitehall Road closer to the top, it gets a little less war-zoney. In my time in Bensham (02-06), there was definitely something approaching gentrification in the blocks closest to Saltwell Park.

In my opinion that makes her... quite mad. They really aren't worth 150, I'd say all things being equal they're more in the 80-100k(tops) range and I think we'll see that yet.



Yeah been out with "that" type, why is it they also don't like the metro, it reeeeeally isn't "that" bad



Do you think there is a connection?

I know - they are a bit of a pain.

I remember meeting this nurse back in early 2004 who didn't believe that I was a company director because I lived in Bensham and, at the time, didn't drive a car. We then went back to hers and she proceeded to tell me how much in debt she was.

I said back that it was a typical of the difference between someone who comes from a working-class family with an aversion to debt and an understanding that debt wealth is an illusion and someone who wants to keep up with the Jones.

Needless to say, it didn't get past the second date. Typical Princess/Western woman complex - "no matter how slobby, arsey or financially illiterate I am, I deserve the best man going".

She probably bought at completely the wrong time, purchased it last year in August I believe.

Sounds about right, in my *ahem* property bee "perusings" they have fell on average 15K and they still aren't selling, most are up for around the 139 mark now

Not wanting to do yourself a disservice but being a company director isn't that flash, it just takes a few forms into companies house, but I know where you're coming from It'd impress the ass off most people and the knickers off most women.



Well that's an interesting point I always thought the more middle class families were the prudent, (small c) conservative ones during boom times and the working class were the big time, stupid spenders. However what constitutes middle/"upper working" class nowadays? This is why I strongly believe there will be a noticeable social reversion amongst those with less of a *ahem* erudite/experienced family background and all those 3 series/X5/40000" Tv/2 bed semi types will learn the meaning of bean counting and how bad ford customer service is.

On her street, the neighbours have been trying to sell for...well...one since August and the other for at least 6 months. The latter has changed EA's at least once. Doesn't look too good for them.

I do quite like festival park, very quiet and cosy. I sound like im old. God, what noisy students can do to your preferences.

Yes, you can tell her neighbours I've been watching with interest, can you tell the one who relisted at the same price with a different agent it's gonna make all of no difference...

Slightly annoyed in a way, there's a really nice one up with garage and reasonable sized living area, looks like a btl trying to dump and run, but after some drop in price sticking solidly at 140k. It has been sstc but was made available again not long back.

Very true. It cost about £20 to set up a company when we did it.

However, not many people know that!



Decent points - there may be different "working class" backgrounds.

I was brought up in Blyth and my friends' families and their etc tend to be quite prudent with cash and debt. It's when one of them gravitates towards middle-classdom that some go a bit haywire. Not that many from my experience though although your experience might be different.

Nail.. head.. hit.. on the

The irony is by their very actions they gave away their true background and will therefore revert to trend instead of learning the hard way and working their way up, this is what easy money does!

The other thing to note is stupidity and ignorance runs through all social classes

For the record i am also a director. I feel shit hot

Nah but seriously, need to figure out how the feck to pay out dividends practically. Got money tied up (I was going to use it for deposits, sort of). Now just sitting in the bank.

Hooaaaaa not paying for an accountant!

Just read the stateman's article. Seemed gloomy. So glad I did not buy, god it was close.

By the way, what's your view on the shared equity schemes?

Shared equity = Madness

If you're considering it: Admit you can't afford to buy and just rent.

Haha I blatantly admit I got f*ck all savings.

Why is it madness though? To me it sounds like a good deal?

They take 25% of the sale price (I would sell within 10 years).

Shared equity in itself seems like a flipping easy way to get a mortgage without a deposit?

Why is it bad?

My accountant does that for me and saves me bundles. It's mad that I pay less than a cleaner in personal taxes - not fair at all but it's the accountant's job to give his client as much in savings as poss.

If you want to contact them, PM me and I'll send you their details. We pay about £300 a month for our service but easily save 10 times that a year in all sorts of deductions I would never have known about otherwise. Plus, according to ITV, the Revenue are far less likely to snoop into tax affairs of companies and individuals represented by accountants because accountants are good and know what they're doing.

My turnover is far too low to warrant 300 quid a month unfortunately (or any money really, well maybe 50 quid). We are taking turnover around 10-20K a year (it's my pet project, after getting rid of my business partner - never start a business with your best friend is the lesson from that!)

I'll trawl direct.gov.uk again, see if I can figure this shite out

A good accountant should save you more than you pay him

Shared equity... You have to pay mortgage on 75% and rent the other 25% but your exposure may ultimately be 100% when you come to sell when prices may be 50% lower. Also if you try to sell before the arranged period you "will" find it difficult to sell a percentage of house.

Well, the deals I had were 10 years rent & interest free. So basically, for 10 years I pay f all on the 25%. When I sell, I sell 100% of the house. The developer doesn't keep the 25% as I understand it. They get 25% of the value I sell it for.

I do however suspect that they might have something to say about the valuation, where I guess the potential crunch could be. Either they perhaps try and value it themselves or simply take 25% of the sale price. I know the different developers have different systems for this. I am still going to view the property tomorrow so I know what it's like in the future, when I might actually decide to buy (it is ridiculously close to work, and not in that bad of an area really except its next to the flipping coast road ).

So all in all, the 25% equity thingies I have been offered at least to me seem like a bloody good deal. Then again, I don't know that much.

But surely you pay the 10 years rent *scratches head* Think about what happens if your lifestyle changes and you must sell before 10 years, what are the catches?

Is it not buy 75% with mortgage, pay rent on 25%?

Why not rent 100% and save what ever you have left after food, fags, pros whatever etc... then in 2 or so years buy 100% of the same property for 50% of the price?

Do you want 1) a good home that's right for you or 2) a cheap good home that's right for you? if 1) buy now, if 2) don't buy now

You have to think of the longer term knock on affects of your decision now, paying £2-300 more on a mortgage buy not waiting a couple of years may mean you never have enough money to get something later on you really really really want. <tongue in cheek> Equally the crash may never happen, so missing the boat</tongue in cheek>

Hi, no it's definitely 25% interest free and no rent kind of thing. I had the option to pay it back over 10 years as well. Anyway, I won't buy now anyway as I didn't previously realise exactly how bad the housing price situation was.

Gladedale and George Wimpey offered the same sort of thing.

I will ask the EA this tomorrow just to clarify, as I could of course have completely misinterpreted her.

AAAAAHHH, I think it's the other type of deal where you "do" pay for the other 25% but over 10 years!

This one's a tricky one to call because in 10 years you probably will have a house worth more than the 75% + 25% BUT you're still paying an exhorbitant rate, essentially what the builder is saying is the only price we can really sell these houses at is 75% of our asking, what does that tell you?

Look into the catches of ownership during the 10 years, it all sounds a bit smoke and mirrors to me.

Ultimately what you need to remember is you're being given something for the initial sticker price but not right away, current prices are mental so I wouldn't pay it now or over 10 years. Also wimpey stuff tends to be a bit... *ahem* of questionable size and quality. Haslam stuff seems good but they seem to be the epitome of "good customer service until we've taken your money and then we'll show you where the nearest cliff is"

LOL

I don't know of any mortgage affordability questionnaire that doesn't include monthly prostitute expenditure!

Apparently, the Baltic Quays flats are full of these ladies. I remember an article from the Chronicle a few months back when one resident was quoted as saying random men kept stopping her asking if she was "insert female name here!". Yep, those flats are worth £250,000 alreet!

I'd expect the flat plus special "lifetime allowances" for 250k

The thingy was definitely no interest no rent on the 25%. Can pay back in three instalments over 10 years. When you want to sell you either have it valued and give them the money, or sell and then give the money to them. Have not read the fine print though.

Anyway, the size of the loungue was actually really really good. There was actually minimal road noise despite the close proximty of the coast road. The windows did the trick.

However, the main bedroom was utter shite size wise so you were spot on there. The second bedroom was...well...not really a bedroom, more like office space if anything. There would not have been any room for wardrobes in the main bedroom, they would have to go into the second bedroom.....so in effect its not really a 2 bed room, more like 1.5.

I couldn't say much about the build quality, those issues usually tend to surface after a couple of years. I know a lot of new builds have 10 year's building guarantee (or whatever the real name for it is) but this had only 2? Is that normal?

Anyway, in the end I dropped some figures (from here, and mainly the marconi house price drop of nearly 50%) and the general slowdown in the market by 6-something% and said "I wouldn't be able to buy for 132".

She didn't even try to defend it, the estate agent that is, and said "what would your offer be? 120?".

|Just for your info: I have no intention of buying this place buuuuut I thought I'd check what they would reasonably be willing to go down to. So I said I could offer 100K (which means I would get a mortgage for 75k and they keep 25% of the equity).

She was desperate for a deal and said "if I can get you to reserve this property this weekend, would you come down and sign the papers? You could even give me your credit card details over the phone".

She's going to check if they would go for 100k, I doubt they will but I thought it would be interesting.

When she noticed I seemed to have issues with the size of the bedroom she said some rememberable things, such as:

"you hardly spend any time in your bedroom anyway" and started talking about completely separate things such as "oh peope from your company has bought other property from me blah blah yadda yadda". Sort of trying to get me to not think about the ridiculous size of the main bedroom.

Anyway, it was interesting to have a look anyway.

EDIT: 10 years not 3.

2 years warranty, so it can't be the nhbc gaurantee surely? Not that that's worth anything anyway.

Wow they really really sound fricking desperate, I loved the "oh what will you offer, 120k?" classic sales subterfuge, translating to "you can have my bloody kids if you give me 120 you gullible fool"

Is this the haslam one in wallsend? I quite like the detaches they do but there's only two there and they are really seriously stupidly positioned. The 3 level town houses seem nice as well. I was just really dubious about the location, looks a bit dodgy to me, especially what it backs on to.

The other thing is... are they willing to give you that house with the 75-25 deal AND a major discount? f**k me! I'd be asking if the sales rep does extras as well (if she was nice... and a she), but my scruples tend to go out the window when I smell blood when it comes to a deal.

Edit: Just realised are you talking about the Wimpey one? They only seem to be advertising 2 bed flats and 3 bed town houses, the town houses don't look "too" bad, but £180k, excuse me a second...

HAHAHAHAHHAAHHAHAHAHAHAHAHAAHAHAHAHHAHAHAHAHAHAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
AAAA

Oh mercy!

That's better

Yeah it's the wimpey one. The surrounding area is actually OK (well you shouldn't perhaps cross the coastroad...or venture too far towards the river..).

And she was giving me such a massive amount of sales talk it was ridiculous. Seriously, car dealers are saints.

If you haven't offered, try something really really cheeky, I mean seriously think of a number that makes you blush to ask, like 40-50% off. If you got it down to that level you needn't bother with the 25-75 deal, it would just be hassle. Better yet, if they turn it down, say ok, I'll take my ready to go mortgage promise and substantial deposit elsewhere, here's my number when you change your mind.

It may work if you're really getting "I'm bloody desperate to sell this" vibes.

Well, buying now seems silly anyway but..i mean...around the 75-100K mark I think i might actually dive in. But then again, why dont i just get something closer to the city centre...ehum. Hardly any developments there though and I still have F all deposit.

Hmm, wait for the next one in marconi house. I was starting to think I should reiterate the idea "maybe you should think about elsewhere unless you reeeeally want this".

Another thing I've found problematic about these coast road developments is they're slap bang right in the middle of the metro line around newcastle/top of north tyneside/the coast/bottom of north tyneside, so you'd have to use your car, not quite close enough to walk. Maybe use your bike, but I refuse to use buses *shudder*

There is logic in buying now if you can get a stonker of a deal, I mean why not if it's what you want? but really I'd come back to my initial advice....

2008: Bank <- Your money
2010-11: Bank -> Your Money -> House

Yeah the coast road developments pretty much require a car, which I've got so I'm fine. But really, living in town would be much preferred (except getting back home around 5 o'clock which would be a nightmare).

Marconi house would be nice like, despite students living not far away. Secure parking is worth a lot too.

Yeah the coast road developments pretty much require a car, which I've got so I'm fine. But really, living in town would be much preferred (except getting back home around 5 o'clock which would be a nightmare).

Marconi house would be nice like, despite students living not far away. Secure parking is worth a lot too.

I prefer not to have to "rely" on my car

UPDATE: They came with an offer to me. Down to 105K from 132K. They would pay 5% deposit as well.

That is a reduction of 27K. They didn't seem to want to offer the shared equity scheme though.

Quite interesting, that.

I said "no thanks I think the market will go down further".

PS: I couldn't get a mortgage with 5% deposit paid anyway

Ask them if they'd pay the deposit on your mortgage

I just received another email from another developer, and now it's Gladesdale. They've got a new development in Fenham. Well they say Fenham but it aint the Fenham postcode, but rather Cowgate!

Quote:
We are now able to offer The Claremont 3 bed semi for £165,995 previous
price was £184,995. We have more reductions on site. Please contact us
on site on 0191 2864363 for more information.

I had a look at the three bedroom ones, even though I was after the the 2 bedroom ones (before I knew better). Obvioulsy, now I know I would never want to buy a flat or house in this market. This was 1-2 months ago maybe?

I remember the third bedroom in the house:

I said "Oh so that's a small study/office then?".
Gladesdale sales woman: no that's the third bedroom.

I seriously doubt you could get anything else in there apart from the baby/toddler bed (you know the small ones with fences, so to speak) which was there. And I am sure it was there for just that reason..nowt else would fit! Why do newbuilds have so crappily sized bedrooms?

Edit: Clarified I was after 2 bedrooms.