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Ballymena Boy

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  1. Has anyone else noticed a recent wave of houses being priced surprisingly low compared to what we have been accustomed to seeing? They are all/mostly repo's. I am bidding for a couple in the Co. Antrim area. I had several good conversations with different estate agents; those houses are deliberalely priced to sell, regardless of the current market. They will take any offer anywhere near the asking price.
  2. The advice (economic fundamentals) on purchasing are exactly the same as last year although the discounts you can get are different.
  3. As usual most of you bears have missed the point, even though the detail is there for all to see. It’s obvious my article is designed to encourage people to use their brains when purchasing property. I am clearly talking about the BTL and first time buyers market (read my first paragraph). I emphasis the ease with which discount prices can be obtained. Yet Yadayaya talks about a person buying a single property for 2.5 million Euros. Even though (political discussions aside) its not even in the same country, it’s completely off the price scale compared to the properties I am talking about. People like him (said property buyer) are fecking idiots and deserve all they get. NO property is worth 2.5 million, not now, not in 2007, unless it’s, say, a fully renovated castle with 40 acres of land. I take it this is not the case with your friend. I made it clear that “anytime is the right time to buy†PROVIDED you follow the simple rules. Yet you bears have conveniently “forgot†the last part of this advice and concentrated solely on the first part. My post is for sensible purchasers who can buy now for a discount, not the stupid people who pay crazy money for properties which are obviously not worth it (2.5 million guy above). I can’t legislate for that. I also make the point abundantly clear that property ownership is long term, yet bears are fixated with the current temporary market down side. You must expand your horizons if you are to see the opportunities which are out there today. So as to make it easy for you bears to understand, let’s take an example: Question "should a FTB who sees the house of his dreams (at 40% discount to 2007 prices) purchase in today’s market". His finance is secure and his LTV is 70% and his total loan is 3.5 times salary. In addition he managed a 10% discount on the property price, as there were no other takers in the market "scarred off by the “profits of doom†(BB and the like). The answer is obviously YES, FTB should buy. They can secure the house of their dreams, with the added bonus of a low fixed interest repayment for a number of years. They will reap the financial and emotional benefits enormously over the next 10 to 20 years (following my advice). Or, on the other hand should they wait and try to get another 5%-10% property price drop (bears advice). If they wait till the market bottoms out (as suggested on this site many times) they will as they say “miss the boatâ€, as no-one can be really sure when the bottom is reached till we are actually past that point. In addition (if they wait) there is a very good chance that their dream property will be lost to another bidder while they “wait in the wings†for a price drop. They (FTB) will then wait still further (as they are pissed off their dream property is sold) and end up bidding (post bottom of market) on another property which may or may not be as good as their original dream place. However by that stage, other people will be back in the market too (remember the Sheeple effect). FTB will be outbid on a few properties and then will eventually succeed in purchasing a property. However due to the fact that other people are now bidding, the agreed sale price will be pretty much up at the asking price, which means FTB will get NO discount whatsoever. They will probably, have bought a property somewhere close to the price they were going to pay for their original dream property. Subconsciously FTB will always feel their purchased property is inferior to the one he originally wanted (human nature I’m afraid). In twelve years time (or whatever) when property prices have doubled, FTB will kick themselves that they waited for a 5K-10K price drop, when their dream property was practically in their grasp. There will of course be a select few who do manage to buy on the day the market bottoms out, but most punters will be shaf--d as usual, because they did not follow my advice above. I predict that in six years time there will be thousands of people who discuss at dinner parties and on web sites; their dream house that got away because they were waiting for a measly few grand price drop. Is it only me who sees the irony of the current situation? Bears current greed is every bit as bad as the greed of people who bought in 2007. In 2007 people bought expecting the market to rise 10% in a year, yet in 2009 bears are not buying for the sake of a 10% price drop in the next year. It’s actually the same greed in reverse order. If you are a FTB with reasonably secure finance and you see the house of your dreams ………….then buy the fecking thing.
  4. It’s been a while since I contributed anything to the site, so I thought I would give my view on the current Northern Ireland housing market. As some of you may be aware I am an investment (BTL property) bull and would recommend you buy in the current market provided your cash flow stacks up. I would also recommend first time buyers dive right in, especially in the lower end of the market (see below), provided you get a good discount on the current asking price. A good discount in today’s market is certainly possible, if you have the nuts to go for it. First things first, property does rise in value and will eventually double in price over time. The most important term here being “over timeâ€. ANYTIME is therefore a good time to buy provided you follow simple rules discussed many times in this particular web site, the most important two, being, house price versus wage and also loan to value. Based upon my own calculations I would recommend a Maximum of 4 times your wage to loan amount. Other people recommend 3 to 3.5 times, but taking into account various factors 4 times seems a reasonable maximum to me. With loan to value obviously the higher deposit you can get (hence lower LTV) the better. With a high percentage deposit you can still have a range of mortgage providers to choose from and you also get the best interest rate deals. Another important aspect to appreciate is that any property investment (BTL or to live in) HAS to be viewed as long term. Effectively this negates any future drops in house prices over the next year, because we are holding for at least ten years (my goal). I estimate it will take 12 years for most property to return to 2007 prices, but that still give me 100% increase in property value, on the prices I am currently paying for property, i.e. asking price minus discount. You will now see WHY any 5-15% drop over the next year or so is insignificant when compared to the end long term result. Now that I have irritated most bears on this site, let me further annoy you by actually agreeing with you on a specific point: The price rise Q2 was indeed a blip, further price falls are inevitable. I have kept a list of the number of houses for sale within certain price ranges (from propertynews.com). The price ranges are ₤30,000 to ₤80,000, ₤30,000 to ₤90,000 and ₤30,000 to ₤100,000. I started my review on the 24/09/08 and have reviewed it, usually, once per week. I can confirm that of the 82 reviews I carried out, all but three of these showed an increase in the number of property in that group for sale. On the 24/09/08 there were 223 properties for sale in the 30k-90K group; by the 21/8/09 this had reached 1040 properties. In the 30k-100k group; on the 24/09/08 there were 560 properties, yet by the 21/08/09 there were 1,864. In the 30K-80K group; on the 13/11/08 there were 139 properties, but by the 21/08/09 there were 508. This means that houses are continuing to drop in price moving the complete property market down. Further house price drops (based on actual sales) are inevitable. You will not see the market stabilizing until the number of properties in these groups stops increasing and begins to reduce. This has NOT occurred to date. I also believe we have an odd situation regarding the University of Ulster (UoU) average house price as calculated for Q2 2009. The increase in the average NI house price does not sit easy with the figures I provided in the paragraph above. So I carried out a wee bit of further investigation. If you look at the prices for homes “sale agreed†on the TDGITS website it is interesting to note that the majority of houses purchased are in the mid price range bracket (100-200k) and not at the lower end of the market (as I had expected). This is backed up by the fact that the UoU survey states that only 19% of house sales were in the low price bracket (under 100K). This leads me to believe that (proper) working class families, low income singles and even BTLers are mostly absent in today’s property market. It is this fact which is currently pushing UP the average house price, yet at the same time we are seeing asking prices fall in ALL lower house price brackets. However as the number of properties continues to increase in the lower price brackets (as is occurring now) and as mortgage restrictions ease (even slightly), then sooner or later working class people will enter this market (under 100k properties), on mass thus having a crushing impact on the UoU average house price calculation. My own estimate is that the average house price will drop a further 10% -15%. So we currently have the very surreal situation where we have an average price rise, yet falling asking prices. You can already get some real bargains in the (below) 100K market, and it is for this reason that I state that now is a good time to buy. If you get a decent ex-council house for say 70-90K (hundredths available) then any future UoU average house price drops will have no relevance, as their figure has to be rebased as lower end buyers enter the market. Thus by autumn 2010 we will have another surreal situation where houses in the lower price brackets will not actually drop in value (sale agreed price) even though the average NI house price will decline. Another amusing scenario would be, where the actual values of all property, i.e. the sale price (from say Q3 to Q4 2010) could stay exactly the same, yet the average house price (as calculated by UoU) would drop substantially; entirely due to the effect I discussed above. We could even go one step further, whereby Q4 2010, the actual price people pay for their new house could rise slightly, yet this would be reported by a fall in the UoU average house price. Imagine that, house prices rising and falling at the same time - oh dear BB’s head just exploded. Obviously the above is entirely dependant upon the rate at which working class families return to the market in proper numbers. Working class families make up the majority of the market in Northern Ireland and therefore have considerable impact on house prices. All of this will definitely lead to even more confusion on the great NI housing debate. Always remember nothing is impossible with Northern Ireland property.
  5. This is without doubt the stupidest govenment thinking for quite some time. Limiting borrowing to 3 x salary will definately lead to complete market collaspe. The FSA are so stupid they do not appreciate how the housing market actually works. Currently there are few first time buyers. Most current purchasers are investors looking to strengthen their portfolio whilst prices are low. However they will also leave the market if this 3 x salary became law as the chances of any capital gains would be greatly reduced. That would leave no-one to pick up the pieces. The FSA are really stupid to be even considering this.
  6. This article is absolute rubbish - the charts (excluding the first) are of no relevance whatsoever. He may as well have prepared a chart comparing the improving quality of computer aminations (over time)against rising hosue prices and stated there is a direct coralation. He's forgotton about the prime mover for house price growth - human needs. People do not NEED gold, nor silver, and the FSTE gives many people terrible wind - but they (people) do need somewhere to live. A place to live is right up there with food and clothing in human needs. House prices will never drop to 1990's levels (in Northern Ireland anyway), because I'd be selling my granny and putting my mammy into prostitution to get the deposit money to buy them all, long before they reached that level.
  7. I get paid in USD equivalent, so as you outlined above I am a very happy man when bringing my cash back home. All the more reason to be purchasing investment property now.
  8. I must agree with weeboby on this one, your remarks are well out of line. The auction results are invaluable to me as an investor as they give me a ball park figure of the complete and utter bottom of the market. This is one of my favorite bits of the site AND I DON'T LIKE PEOPLE ATTACKING IT, NOR ON QUESTIONING THE POSTERS MOTIVES FOR THAT MATTER. One question could be "who cares what his motives are"? He does a good job, so why does it matter? PS, only use capitals for effect, not for the whole piece.
  9. The economic conditions we now encounter have NEVER been experienced before, therefore historical references cannot be given, nor can they be inferred with certainty. Some of the economic conditions are the same as previous recessions, but not all. If you can show me a case with record low interest rates and yet record low mortgage approvals, then I will take another look. I do think however, we both agree that the falls will continue for most of next year. As I've stated previously the number of reposessions will be significantly less than previous recessions, due to the current government action and the low interest rate environment which we will have for at least the next two years. This week there is every change the BOE rate will drop to 2%, with an associated drop in the LIBOR rates.These rates are not linked, but will move in roughly the same direction. Low interest rates will enable people to stay in their homes - they may not prosper, but they will not be turfed out unto the street. The number of forced sales will be low (comparitively) which will act as a stabiliser to the market. We have also had massive price falls over a small period of time, although there is more to come. But this rate of fall is unsustainable over, say, a four year period. This leads me to believe that the falls will be fast and furious. My view is 45% fall, your view is 60%. It will probably be between these two sets of figures, but the time frame for the complete fall will be approx 2 years (Q3 2007) to end Q3 2009, with some slight gains Q4 2009. The credit crunch is difficult to interprite. Caused obviously by financial greed, but where does it stop? How many more bail outs are there going to be and over what time period? I suspect the majority of (bank) bad news to have filtered through by end Q1 2009, maybe Q2 2009. Bearing this in mind and the current/future government action (guaranteeing housing loans, etc.) then it is entirely likely that mortgage lending will have risen by Q2/Q3 2009. After all we are at record lows, so it would be realitively easy to see a rise in lending. Unemployment is key to this whole discussion, but there are too many known/unknown variables for me to discuss, however I am in broad agreement that unemployment will rise by a substantial amount. So my view is that the correction will be brutal, but short. Many more records will be broken before the end of this process. One of the most interesting aspects of the current housing crash, is the twin market that has/will develop. There will be a market for investors and a market for everyone else. The investor market (at 80k and less) is basically entirely independent of the average NI house price debate, as the top price an investor will pay (80K) is currently 60% less than the current average NI house price. Even today on propertynews.com there are 157 properties for sale at 80K and less, and a massive 400 at 90k or less. Investors will continue buying over the next year (as the purchases are cash flow positive and can be cherry picked at will), whereas the FTB (as an example) will not, as he sees the average house price dropping over time. In effect this will give us an unusual situation where both the argument for buying property (as investment) and not buying property (FTB's) will BOTH be technically correct. This process with both parties being in the right has caused much confusion with you bears, so I hope the above explains it OK. Many sellers have adjusted there prices to the new NI reality, so its time (over the next year) to take advantage of this for personnel long term wealth creation. As you're interested in historical data, check out the long term trend on the Nationwide average house price graph on this very site for proof of long term property gain. The long term trend only goes in one direction my friend. PS, Just so there is no misunderstandings at a later date, even if the average NI house price rises by as little as £1 in Q4 2009; this still technically constitutes a rise. This is a silly comment I know, but it will help avoid any confusion for you bears at a later date.
  10. Thanks for the decent responses to my last post. A few points: My figures do not allow for separate management. I do not use an agent at this moment in time, as it is not economic for me to do so. I only have a couple of investment props and can manage by myself. To further the discussion I would say all my posts are aimed at small investors, and the ones just starting out. To give them encouragement and help. At this level, management agents will not usually be required. Plus you should actually enjoy dealing with your tenants and the rest. I don't really see the point of this type of investment if you can't be bothered looking after it yourself, at least until the business builds up a certain crital mass and you can briing on an agent for youself. Now there are various comments about void periods, bad tennants, etc. and these are 100% correct. There are no cheary answers if you have a crappy tenant. You could lose money IF you have a single property. BUT, moving on from my original No.1 I would recommend you aim for at least 5 BTL properties. Spread the risk and you will minimise every single propblem you could have. Four properties will usually cover the fifth. You can afford 20% of your portfolio to be in a loss, yet still maintain positive cash flow overall. There were additional reasonable points about solicitores fees, etc. These should be added to the deposit and will not effect your returns much. Mortgage fees should be added to the loan, this is NOT included in my figures and will make the return a few pounds lighter.
  11. The web site title is getting a bit stale don’t you think …….I KNOW………….why don’t we change it to HOUSEPRICERISE.CO.UK Brilliant idea, don't you think.
  12. Good response. The reason why I joined this site in the first place was because you and your other regular posters were ahead of the game (that's a compliment to you and the others by the way). While everyone else was talking "rise" this site were giving the truth. Now however that stage has passed and we are roughly in the middle of the fall period. So this site is not ahead of the game, it is simply discussing what people already know - agreed. The only thing you have to offer therefore is the EXTENT of the falls. Now by Q3 2009 the falls will be practically over and you will be caught with your trousers round your ankles, as you will have nothing more to discuss. Mark my words this whole web site will be dead and buried if you do not stay ahead of the game. Simply talking about the extent of the falls is completely relevant, extremely important but somewhat boring. Surely you MUST realise that it cannot be the ONLY thing to discuss. Sogy has made a joke about it being a 59.9% drop instead of your 60% estimate …………that IS a joke, right Sogy? But it does in a way summerise what you will be left with if you take away other peoples views on the next phase of the property cycle. If you remove the positive contributions investment property can make to this section of the site, then you will be diluting the value of the product substantially. I like this NI section of the site and really don't want to move anywhere else …………… sniff, sniff, I've nowhere else to go! ! By simply DISCUSSING investment when we are in an extremely negative market, you ARE staying ahead of the game. In 2010 when the market is rising (very slightly by the way) then people trawling this site will say - WOW, in 2006 these guy's were discussing massive falls and were right, and back in 2008 they started discussing price rises ahead of anyone else – these guy's really DO know what they are talking about. And you will be part of that my friend, and so will I. Since 14th November the "Property Investment" section has had 4164 hits, it's the most actively searched part of the NI forum. It's had more hits that practically all new topics added together, less than two weeks after first post. By contrast "EA Closures Etc" has had 5174 hits in seven and a half months – that's OVER 16 times longer. People DO want to discuss this stuff, by some margin. Believe me if you cut out positive thought and don't move on then you will, as they say, be cutting your own throat. BB read the above in an honest fashion. Now I'm going to put the future of this web site into your very own hands. I'm going to let you decide if I should keep on making positive contributions to this site. That right, you and you alone. You are the one who posted the topic and I feel it is only right and proper you should answer. The question I am asking you personally is - do you want ME to withdraw from this website, thus lowering the overall standard, minimising the discussion content, dismissing the opportunities for an honest debate, making the NI section solely to discuss price drops and therefore seriously reducing the lifespan of this particular site, whilst at the same time admitting you haven't got the +++++ (answers on a postcard) to tackle this situation head on, by using constructive arguments against my points of view, but would rather use sneaky attempts to get us (bulls) to move out, on the fly. If you answer Yes to the above then I give you my word I will no longer contribute to this site. If you answer No then may the jousting continue and be assured of the health of the site in general. Of course there are other ways to answer this, if you can think of them. PS, I especially liked the sentence about being verbally 'attacked', you have some nerve saying that, after your posts. PPS, to help you make up your mind, I have an absolutely cracker post coming up on Property investors HELPING those in need, you will love it, now do you want to hear about it or not? PPPS (is there such a thing?), to help BB make up his mind, why don't you other regular posters give your firm views based on what I have said above. Try and concentrate on the main point of this post rather than the slanderous remarks I used at the end, by the way.
  13. Thought you bears would enjoy this. A few months ago, through a private sale, I got a two bedroom apartment 'sale agreed' at 42K, believe it or not. Average area but really nice apartment. Anyway my usual lender (BMS) said they would not lend on that particular apartment as they had too many in that particular block, and could I pick SOMETHING ELSE. I got my mortgage broker to search through the entire UK market and they came back saying there were no other lenders. Puzzled I asked them why, as this apartment was well below market value and the 'sums' were excellent. He told me it was TOO CHEAP. It was below the other lenders minimum loan values (by the time you took the deposit off). Apparently they were perfectly happy to lend me the money IF I could persude the owner to sell it to me for 60K instead of 42K. I lost the property. .............. I know, its a shame. Any other property funnies.
  14. Honestly, I though this was hilarious, really funny. Very good original post.
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