7x, my ar*e

Your programme last night used the example of a house that has tripled in price in five years to point to how buying a house is such a good investment, however it struck me that this may not be so. A commodity with such a volatile price that can triple in price over five years can surely drop by as much over the next five years. If the chap in London were to take the mortgage out where his repayments equal his salary (especially on historically low interest rates) he is stuffed if interest rates rise by a historically small amount such as 1% (remember 15% interest rates in 1992?) The house I'm renting is worth £150,000, to buy now with a 10% deposit and an interest only mortgage fixed for 2 years from C&G is £595pcm, repayment £812pcm. I rent it for £500pcm. Don't be fooled by the rent is dead money line, what is the interest payment if not rent paid to the bank or building society? I save £95 per month compared to the interest only mortgage, have a £15,000 deposit, don't have to pay maintenance, buildings insurance, stamp duty or solicitors fees, and am able to move as and when I like within one month (there are plenty of desperate amateur landlords out there with three empty investment properties) . An ING account adds £51pcm interest after tax to my deposit and monthly saving. Surely these figures say that buying now is foolish, live off the folk who thought it wise to buy three properties as an investment, and wait. There property certainly won't triple in price over the next five years, the one you want won't either. Your savings will increase opening up better mortgage deals with a lower LTV ratio, your wages will rise as you advance in your job. To suggest that young buyers should buy now whatever, without even a word on the alternatives to buying, is quite frankly negligent of the BBC. You are advising young people to sign their lives away to debt and drudgery for the next 25 years, just to be able to say "I own this ex council bedsit".

I’ve been looking in on this site for a couple of months now and have read some good stuff, some of it quite frightening when you’ve still not exchanged . I thought I’d add my own bit of anecdotal evidence. After inheriting the family home a couple of years ago I decided to renovate the place at weekends before selling. After 18 months of work gutting and redecorating the place I put it on the market. Considering these are 1910ish 3 bed semis with walk through bedrooms that would be considered terraces if it were not for the 3 foot alleyway between them I was amazed and laughed loudly when I saw the same houses on the street for sale at 120k. In come the agents (I arranged 5 in one day in July) Number 1 was a partner in a large local EA firm and was very down on the market, “its turned and those in the know expect a crash†his line was don’t put it on over 100k, sell it now at 98k or you’ll end up stuck with it and selling it for 80k after Christmas. Number 2 (A new agent with the new American firm in town, the one with lots of hot air baloons) sat down in the lounge. This is the first room you come into and the only one where I had left the original dark green carpet in. She was downbeat on the market echoing the previous agent. As I took her through the rest of the house her draw was dropping progressively further and the word wow was over used. Back in the lounge she told me to change the green carpet for a cream one and put it on at 120k! At the end of the 5 valuations the average was 115k and I was Estate agented out. I decided to undercut the other 4 houses for sale on the street by between 5k and 10k and it went on at the start of August at £109950. Over the following 8 weeks there ware plenty of viewings but no offers, the on street parking and walk through bedrooms being the constant downer. After 8 weeks I decided I didn’t want the place empty over winter and the scenario given by agent 1 was looming, so I dropped it to £99950, now between 20k and 10 k lower than the others on the street. One week later I accepted an offer of 96k. I completed yesterday. Currently of the other 4 houses one is now rented out, one has been used as part exchange for a new property and has sold for around 100k with 5% deposit paid, one has been withdrawn and the original 120k place I laughed at is still on after a year, now dropped to 110k. An identical property has just joined them at 94k, I’d like to think I’ve done my bit (The money is now in the bank and I’m renting for a while longer)