Wednesday, Jun 17, 2009
I don't think so, idiotic advice for the stupid
Lovemoney: Now's the time to buy property!
Harvey Jones thinks now is the right time to get on the property ladder. But what do you think?
Who would be a first-time buyer right now? Given the uncertainty over house prices, I wouldn't. But my friends Rachael and Chris are in that fretful position, hunting for a flat in south London, and they are going through agonies.
Is the house price crash over? Will prices fall further? Will interest rates shoot up? Can we get a mortgage at all? What if we lose our jobs? Are we doing the right thing?
No, no, no you dumb morons, save your money and wait, this crash has hardly started.
Posted by gone-to-colombia @ 05:06 PM (986 views) Add Comment
7 Comments
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1. quiet guy said...
"You need to spend £200,000 to buy anything in London that isn't a shoebox or vile. So even with two decent incomes, we are still miles away from owning anything. Really, it's quite upsetting!"
Common sense suggests that something is badly wrong here. Also, this cannot be reconciled with Jones' statement earlier in the article:
"The market has still displayed a surprising resilience, particularly in London. If you buy now, your home is likely to be worth more than you paid within five years, and possibly even two or three."
If the young couple are struggling, then who will follow them into the market to sustain prices? It just doesn't add up.
2. shipbuilder said...
Why are they in agonies? Even in the unlikely scenario that the market has bottomed out, anyone who thinks that we will be back to 10% + annual rises straight away is an idiot. Surely better to wait and see if the market really has bottomed?
Really, a child could work this out.
3. alan said...
Have a look at the comments from Vince Cable a few posts earlier.
Not a good time to rush in and buy!
4. Clockslinger said...
In the comments section of this article is a poster who bought an ex local authority place in 2006 and made money. Student lets (and HB payments?) more than putting a floor under that particular investment apparently. Also interesting is the combined salary of the couple, isn't this quite a bit above the notional average household income even for London?
5. hpwatcher said...
I copied this from a similar thread, which I responded to:-
There will be a short period of house price rises - then once the QE runs out - expect high interest rates, more unemployment.....then the house price crash will be able to get into full swing.
6. Greenstar said...
I think it is now right time to buy.if you wait 2-3 months more you will miss the bargains as the lenders will start easing the lending now on.then will be a sellers market!!
7. 51ck-6-51x said...
So, She has 6.5K debt and daddy (or mummy) is stumping up 20K for a deposit on a property?!
She asks who has 50K for a deposit in London? - Someone with a good job who has saved over the last 8 years maybe?!
To be honest 200K is not going to overstretch a couple with "two decent incomes" in London, 3 * 1st + 1 * 2nd with him pulling 60K and her pulling 45K would cover more than that as a loan (225), and these salaries are not unrealistic for such a couple in London.
The point is, though, that most are not in that position! Most earn much less than this and struggle week to week (the moral question is should these people be confined to the rental market? A hash question, and to some the answer is a definite no, but we have moved over the last hundred years from no mortgages to a world of credit; maybe that is the real problem).