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House Price Crash Forum


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Everything posted by MississippiJohnHurt

  1. EDIT: I have actually read the thread now which answered my question!
  2. 99%? The owners would take that as an insult. Our area is prime residential housing you know, no time for chancers - these people I'll be dealing with have worked hard all their life. Guess I'll need to pay a premium - it doesn't matter anyway as I'm clearly going to be so much better off by buying than renting, I mean 250k is an awful lot of money.
  3. The article is too light on detail to form a view on the underlying "analysis" but I'd like to see the "methodology". I'm sure it isn't overly optimisitc in favour of buying and doesn't exclude addional costs on homeowners ie buildings/life insurance, fixing the boiler etc . Having said that, the article said I'd be a quarter of a million quid better off I buy a house now, and as it's Mortgage Solutions saying it, I'm taking it seriously. I'll probably put in an offer on somewhere this weekend.
  4. I sort of agree, in that I'm less confident than before, but I've tried in vain to find a bull case, and can't find one. Huge sums are being thrown just to stave off the inevitable for a few years. Any sensible bull case would require significant wage inflation, job creation and consistently low interest rates for years. And to sustain over the longer term, a way better demographic position than the UK has. Just can't see it. And presumably all the intervention just makes things worse in the end. As for Cowie, he's just a typical nomark who thinks that if an investment worked well for him it's always good for everyone. It's as cretinous as watching those psychics on tv. I did enjoy this from the Telegraph's main business comment the other day though: "When 'help’ only harms our first-time buyers The Government’s attempts to help first-time buyers defy logic. Further evidence of this emerged on Friday, when largely unnoticed data published alongside Halifax’s monthly house price report showed a sharp rise in the prices paid by first-time buyers. The policies devised between the Bank of England and the Treasury may be the cause. The Funding for Lending Scheme appears to be increasing the flow of credit with rates on personal loans and mortgages tumbling over the winter, but this led to a resurgence in first-time buyers to its highest level since the peak of the 2007 property boom. The policy, it seems, is to force up house prices because it makes us feel wealthier and encourages spending. And sharp falls in property prices would be disastrous for our fragile banking sector. But higher prices make it harder for first-time buyers. Also among Halifax’s data was the latest price-to-wages ratio for UK property, now at a heady 4.51. That ratio went as low as 3.07 in the worst phase of the 1990s crash. Would-be buyers should be warned that house prices are vastly overpriced." When did FP start working for the Tele then?!
  5. maybe they'll go to 150% with the help of a loan from the spanish government
  6. Your current housing situation Renting - no plans to buy at mo. Got a lovely house that is cheaper to rent than buy so can't see any reason to look at buying What type of house would you like to buy? 3 or 4 bed , semi or detached How much does this cost in the area you are planning to buy in? My earnings are in the top 2% of UK population and a fair bit more than double the average London wage. I live about 25 miles out from the centre of London in rural Essex, with no travel links to speak of. We could not afford to buy a 3 bedroom semi in this area (or, to put it another way, to get anything worth living in for a family would probably cost more than 4x earnings - even in current interest rate environment this is expensive but would become very painful with even a 2% rise). Although I consider myself a well informed person who knows the history of all this, I still find this state of affairs astonishing. How much would it have to cost before you thought it was worth buying? Probably 15-20% less than currently offered Do you think this is realistic and if so how long do you think before prices reach this level? A lot of current analysis about why prices will remain the same, or when they will start rising again, reminds me of the analysis in 2007 about why they would continue to rise: based on wishes and flaky arguments. So although it's been a while, and us bears in the South East haven't been right so far, I still can't see exactly what has changed or improved for the actual buyer. The reality I see amongst friends is: - majority who bought pre 2000 and then upgraded in the boom continue to think they were some kind of analytical geniuses and that prices will start rising again soon - 100% of those who bought their first houses or flats in 2004 onwards are stuck, and desperately hoping things will improve - those who didn't buy/are coming to teh age when they would like to do not even consider buying a house, unless they previously STR, or have really significant contributions from parents for deposit. Whether they have/have not got a fund from parents seems to neatly coincide with whether they are property bull or bear, strangely ;] This last camp to me represents the life blood of the market, and the reality is that it is entirely reliant on recycled profits from the same asset class. What could possibly go wrong?! How are you currently saving for the deposit? Normal savings from monthly pay etc although not thinking about house purchase at all at mo. A bit bored of it all really. Guess I'll need to review this if the new BoE governer is as dovish as some believe. At the moment buying a new camera is more of a priority though
  7. No one mentioned all the unemployed robots when they make 75% of consumers unemployed. Maybe the 2120s will be a time of general strikes and exciting music for the robots
  8. Bumping this question, interested in the views of those who know more, people often compare one with the other but what about nuclear vs all of the above?
  9. Interesting line at the end "At this level, the cost of their first home will be eight times larger than their salary." There used to be a poster on here, Hamish McTavish. Funny bloke but thought prices would always go up. We were debating this and I did some calcs on mortgage repayments at 3-9 x salary (I know, I'm a real fun guy). At 8x the repayment takes up something like 90% of available revenue, so what this research is saying is that on current trends, the market will be wholly unsustainable in less than 8 years? Know it's not quite that simple with joint lending etc, but then a structure which relies on more points of failure being added in to stay standing is hardly an improvement. I've been bored with houses for a long while, but when you step back, it's as simple as the above isn't it? The basic structure is fcked. Any perceived stability in the market is an illusion cos lending multiples are as stressed as ever and high deposits are now the norm. Any bulls left out there better be hoping for wage inflation. Just not enough to raise interest rates ;]
  10. Poor old Harlow, so often unfairly maligned. I live close by and have quite a few friends there, and it looks much worse than it really is - has got a theatre, a famous live music venue, loads of open space, art, galleries, excellent road planning, etc (not to mention the peerless Staple Tye snooker club!) It also has a far lower crime rate than people think. Shame that the architecture has aged so badly which makes it all look so uninviting. Another example of the brave but flawed civic planning of the 50s and 60s I guess.
  11. Yes, markets are well known for travelling in straight lines.
  12. "I'm not giving it away though - after all, I spent 20k on it and worked from at least 9 - 5.30 most days to pay my mortgage off before I retired at 55. And now someone's only offered my 430k for it. The cheeky young scamps all want something for nothing". #ifyoudon'tlaughyou'llscream
  13. We have given up for at least 2 years after we tried to buy our rented place and were told by the landlord (boomer or thereabouts) that we were 80k apart - that is despite offering him an extremely generous 15% off the price he tried and failed to sell at in 2006. The place needed significant cosmetic work doing too. So we took our mortgage in principle and had a look at what we could buy: answer was a number of 2 and a half bed ex council houses in the crap part of our town. For the same price as the interest on the mortgage we have taken a rental on a 5 bed victorian cottage with large garden, very nicely done out, double garage. Etc etc. It is in the countryside outside of the town we wanted to live in but could also have got a decent nice 4 bed rental in town on comparable rates. For comparison - wife and I are both 32, one child, live in a fairly desirable Essex suburb in tube zone 6 (it's hardly Henley or Richmond or whatever - just a nice market town). I now earn in top 1 or 2% of UK, wife doesn't work. No debt, very good savings. We don't expect a mansion - a nice 3 bed semi with a decent garden would be fine, but we're certainly not going to be tying ourselves to a 25 year mortgage and spending our hard earned savings to get something like I described above - I work hard enough for that to very quickly become embittering.... So have given up for now - leave the boomers to sell houses to each other (and the occasional mug of my age who can borrow sufficient money from a boomer). And I wasn't even that bearish in the first place ! But when we looked at the cold facts of our situation, it was just completely obvious that staying out of the market was the thing to do. And given that we don't want to move our little one around too much, we will keep that view for 2 years at least before reviewing. Can't really see the downside risks to this view. Still a huge amount of denial out there about how much we've moved on since the halcyon days of Phil and Kirsty, and flipping rental flats.
  14. I was in Dunstable yesterday, and if ever Ken Loach does a modern British remake of Grapes of Wrath, he might want to check it out.
  15. 45% youth unemployment nationwide. That's a terrifying, revolution risking figure and some theme park in Valencia isn't going to be helping things. Spain is f-cked beyond comprehension - if it had kept the peseta it would still have had serious issues given the structure of its economy and its demographic position, but the property boom caused by falsely cheap Euro era lending is going to bury it for years/decades. I love Spain probably more than my own country so I'm rather sad to see it. It does seem like the obvious place for a HPC tune in/drop out commune though - some pretty fertile farmland up there in Galicia ;]
  16. They're actually very reasonable as a result of the competitiveness improvements over the last 20 years. A few rounds of golf and the odd property portfolio will do the trick (allegedly etc)
  17. Schauble's comments didn't even make any sense did they. Just basically said "the Euro will be good, and it will be good sooner than people think, so Britain will have to join it". My small daughter has better reasoning skills than that. Whether we are in or out of the Euro should rank about 5,000th on the Germans' agenda at the moment. But we do make a great populist/distraction target, so all this shows is how desperate the Germans are feeling about the real issues. On the desperation tip, there's been some amazing statements this week from various EU types - we should get a compendium going.
  18. This is the bit that most people forget when they trot out the "ECB should be lender of last resort" meme. If it was as simple as that, why didn't they just go it in May 2010 and saved themselves the rest of the bother. Cos they know they can't, politically AND economically ! For the Germans, it seems like a simple choice between taking a big hit to their economy and being blamed for ruining Europe, or totally ruining their economy and being blamed for ruining Europe. A one off (very large) hit or an open ended liability....not going to be pretty either way.
  19. yeah I was thinking the same the other day - if you were, say, the 15th country to default, who cares? It might be seen as prudent ! Whether by accident or design Osborne has bought us some time in this one though. Plenty of Europe for the market to get through first. Although today was ominous with France, Austria, Spain all getting thrashed with Italy. Before today the market only seemed able to concentrate on one thing at a time...
  20. Interesting. I know someone who has never worked, who's husband works sporadically, and who is currently driving a rather nice 2010 plate BMW, via this scheme. She got it because she is her mother's "carer" (despite outsourcing the caring for her mother part to other family members).
  21. Steve Keen is certainly no ramper and certainly no VI. He sees the central problem as debt saturation, and if you accept this as correct, some form of debt forgiveness is one way out from the problem (controlled deleveraging / writedowns would achieve the same of course but slower). Sure, it's morally reprehensible and as one of the non-indebted (a VI too) I don't like it, but that doesn't mean it's not potentially a logical solution for the majority. Which is the indebted. I think the main problem is that a jubilee wouldn't actually get lending moving again, as it would fundamentally change the nature of being a creditor. It would quite possibly lead to the death of a debt based economy (so I would have thought HPCers might be more in favour of it )
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