miles2home

thanks alot all for this information. Still don't know whether to buy or hold off !!!! so stressful.

I always love to come on this site and read comments which are very informative. Just wondered what you folks think about interest rates in the UK??? Any signs of them rising soon?? we are stuck...we have funds to purchase a property, but want to hold off just incase they drop some more. So we have spare funds in savings accounts giving 3.3% at best. Be nice to hear what all your thoughts are on this one??

This sounds v. familiar. In 2006 I remember buyers in Orlando doing the same thing, they were rushing to buy even though the market was slowing because of lending getting tighter and these are now the buyers that we are now seeing foreclosing here in 2008, because they overstretched themselves just to get on the ladder and 2 years later are in serious negative equity and struggling to pay their mortgages. It's much better to hold on in rented for another couple of years and reap the benefits later on. Some of those buyers here are in as much as $100,000+ negative equity because they bought at that time.

in reply to your questions. I think the UK peeps will be really surprised because expectations still seems to be high, give that another 6 months and the reality will sink in soon enough. I will be very surprised if the UK isn't as bad as here.

Mike Livingstone - yes you are right the credit crunch kicked off around that time, the house prices had dropped a bit by that time, and then accelerrated at such a fast pace thereafter. We have seen drops as much as 60% in some areas and people here earn much better salaries than comparable jobs in the UK. I think it's going to be much much worse in the UK as the level of borrowing is so much more, plus credit card debt is higher in the UK.

Hi there all, I too, have been watching this site for a while and haven't posted until now. I wanted to add my experience of the market here in USA, as to maybe help people to be a little patient so they can buy a cheaper house over there in next couple of years. My family and I are planning on returning to the UK in a year or so, not sure of when as yet. As mentioned we are currently in the US and have been through the downturn here in the past 3 years. It took quite a while for the Sellers to realise they couldn't get what they wanted for their properties in 2006, and tons of people still buying at silly prices. It took most of that year for prices to drop but didn't drop substantially at that time, but it soon picked up speed into the 2nd year and this year being the 3rd, the price drops are now crazy because of all of the foreclosures and short sales here, which also has a big factor in the prices lowering as the sellers now have to compete with bank owned properties. Looking at the UK from here and looking at the prices in comparison to the salaries over there, I feel that the house prices are at least 50-60% overpriced (that's my opinion) and inevitably will come down by that much, when you put into the equation the tighter lending, the salaries ratios, x 3 or 3.5 lenders are now using again, repossessions which will pick up speed once APR starts resetting and people start to get laid off etc. for those of you still in rented and sitting and waiting, my advice, please be patient now a reep the benefits later on. Luckily we sold in UK in 2005 (we made the decision because we didn't want the hassle of renting it out) and when we came here we didn't want to buy here cos we didn't know where the market was, so went in rented. Even though I really want my own home and am desperate for that, I will remain in rented here and will probably go into rented in UK once we move until the market totally bottoms out in the UK. My advice don't buy now. Some of my friends bought here in beginning of 2006 (just as market was starting to change). They now deeply regret their actions because they are in negative equity by about average $150,000. There are thousands of people here (also those who bought cheap earlier on but remortgaged up to the hilt), who are also in negative equity and lots of people are stuck. They are either staying put (if they can afford to) OR they are having to sell short sale or the worst being foreclosed on. In our neighborhood there are around 10 foreclosures and this is the normal scenario in every neighborhood here, some worse than others. It is now the norm that people are foreclosing and going into rented as there are so many lay offs every day. Once people start reducing and start to compete with eachother then the strength of the drop will pick up speed. Just hold on and wait, don't buy yet. Good luck to all. I wish you all the best!!