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Once Bitten x2 Shy

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Posts posted by Once Bitten x2 Shy

  1. Lenders can and do continue to chase debtors. I think once proceedings have started, they have upto 12 years to try and get their money back. Do not believe that one can simply handback the keys to 'your' home and walk away debt free. It just doesn't work like that and years later the lenders will pop up to demand their money once you have got back on your feet.

    Correct, basically most mortgages with LTVs of more than 75%/80% were sold with Mortgage Indemnity Guarantee (MIG) (which the mortgagees paid for!) which meant that the mortgagees insured the lender against the circumstance where if the property was reposessed and sold for less than the mortgage amount, the insurance company paid the lender the difference.

    Most of those who handed back the keys thought it was the best way to get out of this dismal situation (running away) but did not read the small print which allows the insurance company to track down the mortgagees and demand the difference. I am aware of someone who was tracked down 10 years later and had to negotiate with the insurers as to what they were willing to accept as settlement.

  2. Got more viewings in 1 month privately than we did for 12 months via 2 different estate agents and this was in a slow market in the SE at the time. Again I think that listings on rightmove is an absulte must.

    Have heard of some agents doing an excellent job in selling for some, but these do seem to be few are far between.

    You pays your money and takes your choice!

  3. Sold by using The Little House Company back in 04 after had a nightmare with estate agents. We had listings at that time on Rightmove through LHC but I am not sure as to whether that is still the case.

    Private sale for us went very smoothly and would opt to try and sell privately first and then move to estate agency therafter if no luck. IMHO the sale was made much easier without the involvement of an estate agent.

    I think listings on Rightmove are a must and doing it yourself at least you get feedback directly from those that view.

    Hope this helps.

  4. I think you are speaking for older people. Most young people I know like futuristic houses.

    Futuristic materials will look like brick or stone (indistinguishable to human eyes and touch - not like nowadays), if wanted, but will be much cheaper, less environmental impact, super-insulating and zero weight. There's no way they won't be used - or that people won't be persuaded to want them.

    Marina, to answer your question yes I have along with many others who are savvy business people who are not in the habit of throwing away their money. I suggest that you investigate Japan for the best examples in regard to Modern Methods of Construction where it is deemed a higher quaility product than traditional build. Most people in the UK are ignorant of this and IMO are blinkered from it as developers over here have never been tasked by the buying community to be innovative and to produce anything that mirrors what other more advanced nations are doing in this area. Once the factory built units are put together on site they can be clad and roofed in any way, so they can be made to look just like traditional build.

    We will be supplying units only and will not be looking at development as this will mean us investing in land and having to sell the units. In this way we can make our profit even if land prices drop, which I beleive they will. Only after land prices have reduced to more affordable levels will we plan our own developments.

    Durch, absolutely spot on. Would you build a car in the garden? So why build a house in one? Factory conditions allow for a much better end product, less future problems, more environmentally friendly and far more economical. Once developers are under heavier economic constraints to produce higher quality at lower costs then they will start to have to use modern methods a lot more within their businesses. We can reduce development time on site by at least 25%, so this is an area developers can reduce costs.

    We will be launching in mid October in Tottenham Court road, so people may be able to make up their own mind.

  5. I am involved in a business which will be launching in mid October 2006, where the housing units will be manufactured in factory conditions, in the UK, to high specification.

    These units are made from steel and are very robust and are not of poor or inferior quality. Other nations have been using Modern Methods of Construction for decades and the UK is still obsessed by "bricks and mortar".

    These units have been designed by high end architects and look modern and stylish.

    They cost the same as traditional build, however the savings that are made are by reducing time on site by between 25% and 40%.

    This will be the future of housing in the uk but people will need to become more educated in regard to this.

  6. FFS. patprimer, you are spot on. 100% agree with everything you wrote - which is because you are stating the facts, the researched and thought through facts.

    Council tax depends on the band you are in AND the amount in total that is collected.

    Re-valuation affects the bands - which is fair, the old lady who has had no money and let her house deteriorate since the last valuation (early 90s?) should pay less than me, because I have extended and refurbished my house making it better than hers!

    This has zero to do with how much money government decides should be taken (though it is possible they will try to "hide" the rises in the re-banding.)

    Or maybe the government is looking for a way to tax the gains made on house price increases in the future?

  7. "Oh, and by the way, can we get it straight that in the 89/90 'crash' house prices went down only slightly - the damage was done by inflation. 10% total reductions in price over 4/5 years was all I saw."

    Bought for £68k in 1989, sold for £54k in 1996 (-20% and very, very nice unique flat)

    Friend bought for £54k in 1989, sold for £28k in 1996 (-50% studio flat in reasonable area)

    Both in London, and both very personal and uncomfortable experiences.

    Add the inflation as well and see what you get in terms of real losses!

    Please do not generalise, many went through hell!

  8. It's called a 'change in sentiment'. Every avalanch begins with a tiny movement.

    Sentiment is a very subjective and fickle friend.

    I still maintain that city bonuses affect very few and for that reason is very unlikely to affect the fundementals of the market which are largely driven by normal people.

    When a precious painting comes up for sale the rich will always fight and pay through the nose to own it. It has rarity value.

    Art for the masses however gets sold at much cheaper prices.

  9. I've been reading threads on this forum for a while now and I've got to say I'ts one of the most interesting places on the internet.

    Anyway what caused the dot com bubble to burst and other stock market falls was lack of confidence in the ability for the investment to make money. From what I'm seeing from the news (if I can belive it to be true) is confidence in the housing market caused by lots of factors.

    The governments acceptance of high prices and schemes to help FTB (as thought prices will never go down)

    TV programs talking contantly about propert and property developing

    Peoples genuine desire to own a property

    People still think that the property market is a good investment (rightly or wrongly) and all the others are just desperate to own a home. As long as these perceptions are in place the market will not crash (in my opinion) market fundamentals are all very well but its the often irrational minds of people who are driving this market not graphs and statistics.

    I agree that when the economics of the situation reach break point confidence cannot physically pay the bills. I think that this break point is still a some way off.

    I would like to ask the question as to whether you are selling your property at this moment in time, because if you are not you may not be totally aware of what the market is like for those who are.

    The market is made up from those who want to buy and sell and not those who are sitting on their assets.

    From what I can see at the moment and from what I am being told, selling is becoming a nightmare with broken chains, offers coming in at 10-20% + below asking prices etc etc.

    Also when you compare average salaries in the UK to average property prices, put yourself in the position of anyone who is trying to buy with a deposit they have managed to save themselves. Work out the mortgage that would be needed and what the repayments would be and then see matters from their point of view. It is possible then you may understand why property ownership is so far out of reach of normal people.

    It's easy to become compacent when you have built up equity in a property to understand the economic realities of those who wish to buy their first home.

    Interest rates may be historically low, but the important factor is what you are actually physically paying compared to your income, not what rate you are paying.

    If you are as confident as you seem, please can you explain why you think that property prices will not fall.

  10. Even if City bonuses are good, how many people do you really think are going to benefit from them. Yes there may always be demand for some unique properties, but the real volume of properties will not be affected by the small %age of those who are lucky enough to receive these bonuses.

    The market will be influenced by the volume of those who are employed in normal jobs with no prospect of huge bonuses, and the market will be driven by greed and fear.

    At the moment I think fear is becoming a more and more dominant feature.

    We will only know the reality of where we are in hindsight, but IMO the tide has turned and confidence in property as an asset class is on the decline.

  11. I think that MEW falling is good news for all. Less debt therefore less exposure to HPC for those that bought a home pre-2004. Also less MEW means less spending on the high street which means eventually interest rates will be cut to avert recession. Looks good from where I'm sitting.

    Less spending on the high street = lob losses = less money spent in the economy = more job losses from other supporting industries.

    Can I ask are you employed or do you work for yourself? What is the chance of you being becoming one of those unemployed?

  12. In SE I think 18-24 months from this winter would account for 70% of the likely falls - the rest (and real bottom) would take another 2-3 yrs. I would be prepared to get the chequebook out in Jan/Feb 2007 I think on the basis I that I am not trying to call the bottom (impossible) but buy at trend prices. When I see the right house at 3.5 x my salary I would buy (but offer at a discount!).

    I agree.

    I think a majority of the falls will come by the beginning of 2007, with the bottom being a couple of years later.

    The effects of higher actual inflation, increased indebtedness and the prospect of recession (whether it appears or not) will now start to show its effects on levels of confidence and all markets are driven by greed and fear.

  13. As I understand it this is getting more complicated by the minute. The full rules are not yet finalised from what I have read but if you buy a second property in your SIPP and don't rent it out you will be taxed - on your income - on the second home as a benefit in kind. So, if you buy and have a void for 3 months you are not only having to keep on paying the mortgage, you are paying more tax as well.

    I have a SIPP. To put a property into it I would have to get a mortgage. Now do I want to borrow to buy a depreciating asset to put into my pension? And get charged tax on it if I can't rent it out?

    The average size of a pension pot when people retire is something paltry like £25k. So to do this most people will need a mortgage on their second property.

    The only advantage I can see is that if (in this area) you have a spare 200k hanging about which you normally would be about to pay tax on, you could buy a property with it and stick it in your SIPP and avoid paying tax on it. It's just like being able to make a massive contribution to a pension really. Would you want to borrow to do it? Answer: yes if you think the market is going to rise inexorably. Yes if the horizon (retirement date) is more than 20 years away. Otherwise: No.

    Totally agree,

    The only people I hear talking about Sipps leading to the next demand boom in property do not understand the facts. If they actually ran through a scenario they would see in most cases it is a no go.

    How do you get sufficient money into the pension in the first place?

    Who actually owns the property?

    What happens when there are no tenants to pay the mortgage?

    What happens when I want to sell?

    Who would want to invest in an asset that is likely to fall in value over the next few years?

    Even if you can borrow money, why erode the equity within your pension fund due to the negative effects of gearing?

    Subject to the fact that this legislation actually goes ahead, yes there will be some who choose to buy property, but the vast majority who are supporting this arguement are those who make their living from property and are desperate not to see property fall in value as their lives will be materially affected.

    There has been lost of discussion on this site on Sipps and in general I think it has been very balanced and is way ahead of the thinking of the media and the general public.

  14. Just remember who these people socialise with.

    Within their social groups they will generally talk to ABC1s, who have good jobs are intelligent and are generally wealthy. Most will have a nice regular comfortable income coming in and few will be at the short hard end of where the actual money is generated and where they can experience the real economy. They will currently be quite comfortable and reasonably divorced from the reality of what the economy means for most.

    How often will they come across the small builder, mechanic, shopkeeper who is struggling to make ends meet.

    For this reason I think their commentry lacks one vital feature, what is actually going on in the real world.

    In the real world people are finding it more difficult to make a decent profit and are working harder and harder to stay still. They have seen council tax rises, stealth tax rises, petrol prices rise, costs of mortgages rise etc etc.

    Over the last couple of years these could be concealed by increases in their personal wealth, or in most cases, increased property prices leading to higher %ages of eqiuity and MEWing.

    Property is no longer increasing in value and the feelgood factor is evaporating fast.

    People are now only realising how drunk they were on all this paper wealth and reality is only just setting in. Once negative sentiment sets in, and confidence drops, then let's see what they tell us then.

  15. there is a lot of talk about nulab fiddling the indeces we use to track inflation.

    i don't think i have ever seen inflation charted before on HPC so, here they are.

    cpi is quite a new measure really and so we only have a couple of decades. what would cpi have looked like in the seventies when rpi went crazy?

    looking at it, cpi seems a flatter measure by all accounts and it is easy to why it might be prefered recently.

    the fact that cpi has upticked lately to an astonishing degree whilst rpi has remained flat goes some way to prove that rentals must be falling.

    i base this on the rather sweeping estimate that rpi (roughly) = cpi + housing costs.


    Don't want to be too political, but looking from 1997, is it fair to say that inflation has been pretty much understated, which in turn has led to a long period of oversupply of cheap credit and therefore demand based inflation? If this is the case then this does explain so much of the current economic circumstances we find ourselves in.

  16. I am looking to buy in Northern Cyprus as it looks very good value for money. Spain you just can't find anything under £100000 Turkey looks like a war zone unless your have a couple of hundred, thousand, or you want a High rise.

    I have £50,000 to spend as a long term investment from my pension fund <_<

    Currently looking at northern Cyprus myself at the moment and it is all down to land title. Pre 1974 land owned before occupation should be ok, but need to be careful of exchange land with the South and land that has in effect has been stolen from the Greek Cypriots. Worth looking at the foreign office website. From what I can work out only approx 15% of that land falls into the 1st catagory so tread very carefully.

  17. Imagine there was a world where we could all buy at peak.

    If we were prepared to.. forget that we couldn't manage the repayments..

    £1,100,000,000,000 currently..

    now pan forward a decade..

    First time buyers are back..

    we all have debts two to three times what they would be at normal cost..

    How much would the countries debt be..

    We have a limited number of people buying at peak..

    Now make that unlimited and not over 7 years..

    But everyone.. over 17 years..

    Mortgage debt =?

    personal debt =?

    Can anyone work this out?

    imagine the economy then..

    What I am trying to say.

    Is that for house prices not to come down personal debt that is already crippling the economy would have to increase by what I would expect to be many multiples.

    Can anyone work out some sort of expected figures for this theory?

    We are seeing the economy buckling under the current debt levels..

    If house prices do not come down then many.. many more would have to enter into massive debt...

    Economically is this possible for the economy?

    Don't know about going forward, but this where we have come from since 1997!


  18. STRers: How far do house prices have to fall before the decision to STR makes financial sense?

    Depends on how well you can negotiate your purchase the other end. It's easy to buy anything and make money in a rising market which is why every man and his dog seem to believe they are property experts at the moment. However it is much more difficult to identify quality in a falling or poor market.

    We have now given up looking for any value until nearer the end of the year, however have a pretty good idea of what consitutes good value and when we see it we will buy.

    At present I cannot see us buying anything unless we are really lucky for at least another year.

  19. Um, hold on a miunte...

    I'd prefer not to be called a sucker, thankyou.

    And I'm trying to find the part of my original message which says I'm trying to sell my house to move into a bigger one.

    And I can't find the part where I refer to the 'magic' of my house going up in price.

    For your information my wife is due a 2nd child & I needed a 3rd bedroom. I expect to be here for at least 5 years.

    I find a forum called "what are house prices doing in your area" & post what i percieve to be a fair enough comment.

    Even if the estate agents are adding 10k - 15k, my point is that the house is still up at least 10k year on year.

    My point was that the forthcoming expected slowdown does not appear to have reached this area yet - fairly on topic for the title of this forum?

    I am fully aware that my current house is not *that* much bigger than the first one we bought in the 90's for £29,950 .... I am not claiming to be suddenly rich, even though I'm only 2 years from clearing my mortgage, as I know a fall of 30 - 40% over the next few years is possible, although unlikely.

    Why is there so much anger in this group??? Why am I getting called a sucker for making a completely on topic post??

    I think any fair exchange of views and facts is entirely the right way to conduct a discussion on this forum and if people get personal or abusive then that is very much their problem.

    I posted my reply based on the fact that I have sold a property recently and the valuation range from 4 estate agents was approx 25-30% top to bottom. We eventually sold at almost half way and after 15 months and 4 chains. Incidentally we were looking to move due to a growing family as well, but after the experience of selling we decided to rent and look around, and this we are still very much doing.

    At present there is very little available at a price we would be prepared to pay and with prices definitely moving in our favour we are being as patient as we can.

    Looking around my a

  20. I was once told by a wise man that if you believe the goverment is fudging the inflation numbers (like many of us currently believe), watch the exchange rates.

    These are set by the markets, and unfortunately if inflation creeps up, the value of Sterling will fall. And then roll on higher interest rates.

    Moneyweek have written quite a bit about how the goverment fudge the inflation numbers. When the RPI was about to go over 2.5%, Gordon Brown blatantly changed to the CPI. And interest rates were allowed to stay low.

    The goverment can't keep pulling the wool over people's eyes forver...

    I agree

    It would be interesting to see what inflation would be now if the cost of housing (house prices) were added.

    I can't imagine it would make good reading, and would beg the question why haven't interest rates been higher over recent times?

    Could it be that the government have been spending to try and keep us from recession and keeping interest rates low was part of the illusion, which allowed people to feel that they were richer when the real wealth generation within the economy has been falling?

    The time after the election willbe an interesting one for whoever becomes Prime Minister.

    It could happen that Gordon Brown actually has to own up to his own mistakes rather than basking in the glory he seems to be enjoying now.

    Pride before a fall!

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