Once Bitten x2 Shy

Out of interest do you have other information that gives this information countrywide? I have been trying to find detailed information on what happened in the last crash but so far have been unsuccessful. I see some similarities between now and the late 80s in economic terms especially in terms of overspending. There is a good article in Moneyweek this week which has attacked Gordon Brown in no uncertain terms. After reading this everything that is happening now reminded me of what happened in the late 80s. The common parts seem to be complete overspending by the public, enhanced by easily

I lost 20% on a property I owned between 1990 and 1996 in a reasonably good suburb and know of others who lost 50% in a similar area over the same period. The difference between the two was that my property was pretty unique and the other was a studio flat. the price reductions were relative not only to area but also to property type.

Originally bought in 1996, started viewings in Spring 2003 and sold in summer 2004. 4th buyer finally went through. 3 agents valued the house, variance was nearly 25% between top and bottom, and we eventually put house on at near the top end, and eventually sold at approx 9% below. Moved for personal reasons, schools etc, and due to problems in actually selling decided to rent and cut the chain. Have stayed out since and remaining patient. Have viewed a few properties, but still feel overvalued by 10-20%. Still want to buy but only at the right price, and there seems to be a large element o

IMHO - Pension fund managers have become far less speculative since the correction in equities. There are many exapmles of them moving more to Fixed Interest, gilts etc. I really cannot see any mainstream pension fund mangers/trustees going for this. Common sense dictates stay away on yields alone, let alone the hassle factor, maintainence, liquidity etc etc etc. In addition to this with so much speculation around and more and more figures showing there to be a reverse in property prices, professionaly speaking they would be highly likely to be sued.

Ditto I am having to be patient and my instinct is that this will pay off.

This is a topic that has been raised before and I think it is fair to say that no one can really assess how important this legislation will be. It could be an absolute disaster and add fuel to current house prices, creating an even bigger bubble, however you will need to have cash/value in your pension to use it. If most people feel that the residential housing market is already at it's peak, then why buy? Currently you can borrow 75% to purchase a commercial property through pensions, and after A Day you will only be able to borrow 50% of the value of your fund. If I am right this in effect

How about a fool and the bank's borrowed money?

I am looking in similar areas to yourself and have now pretty much given up viewing properties. Most of the properties I see on the websites have been on the market for months and months, some even for nearly 2 years. I think more will come on to the market over the next few weeks, however I really feel that prices are approx 20% over the top. I think because this is a more rural part of the country, there are naturally fewer properties and being far enough out of London, the effects of falling house prices and how far they will drop will take longer to materialise.

excellent summary. Someone else has said this before so I do not claim it as my own. " renting off a landlord or renting off the bank via interest only mortgages" 1st one, at least you can have your capital in cash and in th bank 2nd one, at this time your capital is likely to be under threat and the bank can always take your property away if you can't pat your mortgage.

soon the prices will reach the magic crossover point and earning will be worthless to personal progression. What do you think that will lead to then in your opinion?

My sentiments entirely. Currently renting a nice large 4 bed house for £1200 per month including gardener, with maintainence not my problem. I estimate that value at somewhere around £400k Say they are getting £1100, after basic rate tax they are getting less than 3%. They would get more from the bank in interest! I can see only one way out of this and it must be prices falling, although my patience is being tested.

So you could say that by making educated assessments of whether you should buy or not buy based your own thoughts rather than buying "cos everyone else is and they are making loads out of it". In my experience those who do make money are patient, decisive and know when to take their profits. They retain their wealth and buy well where others do not see value or where assets are unfashionable. I think the current market could prove to be a perfect example of this over the coming months.

It will be interesting to see what they are quoting next month?

Spot on. I sold 1996 for 54k, the property sold again last year for over £150k. the 15% rates did not last that long either, I remember 10%ish as a sort of average over that time. It's about affordability not what the underlying rates are. People must wake up to this soon.

Who ever has invented this must be a VI hoping for a soft landing! Coming in to land with only 1 out of the 4 engines still running, low on fuel, on fire! Soft landings assured

Tried it. 4.1% increase over the next 5 years What the hell are they basing this on!!!! Which VI is behind this I looked at the last 5 years and even though the average price has dropped for the last 2 quarters, it's predfiction is up now until the end of 2005. Utter c**p!

Yup!! When you combine ignorance and borrowed money, the consequences can get interesting." - Warren Buffett The perfect combination and apathy - excellent!!

Like things in life, reality will be somewhere in the balance. Good luck with what expansion plans you have. On this arguement the optimistic bulls say status quo or slightly increasing prices wheras the most pessimistc bears say 80% drop. I sold a property in the mid 90's for 20% less than I had paid for it 6 years earlier and I know of others who sold at 50% lower over a very similar period. If history repeats itself, 20% won't seem too bad if you decide to keep the property long term, however 50% will hurt. The difference between my property and theirs was that it was unique and in a

I am always the eternal optimist (although you may not believe it) but I agree that all this stuff at the moment is not sitting comfortably with me. Only time will tell but the things that concern me at the moment are as follows. - huge change in attitude over the last few years to taking on debt (sunsidised by equity release ?) - large tax increases (mostly stealth) - huge increases in regulation (you can't pick your nose now without being certified) - growing apathy from most of the population (what are the turnout figures going to be like at the next General Election?) - People not

I see 10% reduction immediately (EAs getting people to shift their opinion and agree that their property has been overvalued) and then offers consistantly coming in at 10% below that. Eventually this will lead to some taking those offers = 20% reduction for those that actually want to sell. Those that don't want to sell can continue to live in denial until they have to face reality.

It seems to me that there are more people being employed by the public sector now than at any time over the last 20 years. Not my opinion - however I have heard it said, that The Gov and Local Authorities have taken on many and in effect reduced the Uks unemployment stats. There is no doubt that many do a good job and deserve decent pay rises, but the overall cost of the public sector now must be huge, and huge taxes must be paid from the entrepreneurial sector (those that create) to pay for this red tape. This extra tax can only then be sustainable if we continue to increase our GDP, i.e.

I hear what you say and agree that no one should invest in things they do not understand, however diversification of your investments is likely to reduce risk for you and could maximise your profits. It's always good to keep your options open. If the property markey drops by say 20% and you are able to unload now at full value, then you can come back and buy a similar asset at a lower price in the future. This would maximise your profit wouldn't it?

This is a very good point. IMO there must be a large number of these, maybe even in excess of the official BTLs. It will be interesting to see in hindsight what effect non official BTL will have. We will only find out once the market starts to unravel. IMO I b I have experienced many crashes, my first being the 87 stock market crash, and why all this seems so familiar to me is that the ordinary guy in the street talk about nothing else than what thay have made from their investments (but without cashing in and having the balance in their bank). Paper profit! Property is not a liquid asset

I'm sure diversification is the key, why would you want all your eggs in one basket? I'm in the south east and have noticed a few pubs coming on the market which once converted could become very nice out of town offices. I'm going to investigate this one further but will need to consider what market there may be for offices in that location, conversion costs etc.