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roblpm

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  1. Just to clarify as the OP - when we bought our first flat at £94k I think we just about had a joint income of £94k. When we bought the second flat at about £320k we only needed a £200k mortgage, actually I think my wife had stopped working but I was earning about £75k. So not exactly nutty multiples. My original point in this thread was that is it obviously easy to be overleveraged, but in a low interest, cheap money, asset inflation bubble if you want to keep up with the jones's you need a bit of leverage. We sold up, and are now completely debt free (actually I owe £320 on my amex credit card which I pay off every month, just use it to get airmiles!). We will never be able to move back to London. Luckily I dont particularly want to. My wife might want to though. Just saying that hpc (and myself) called it completely wrong on London over the last 10 years.
  2. No train noise at all where we live in Edinburgh now. Every train in and out of London Bridge went past our flat, 900 in, 900 out!!
  3. As you say the London boom has been going for about 18 years. I agree that the government has propped up the prices. The problem for London is the additional demand from abroad. I have lived in zone 2 myself and havent seen any oligarchs. But if there werent any I wouldnt have been living in Brixton I would have been living in Marylebone. Actually we used to have 1800 trains go past our back window when we lived just off Tower Bridge Road. I quite liked it!! Christmas Day was weird!
  4. I am sure I agree whatever way you put it! Where I disagree is that the government printing money ZIRP etc stopped a massive crash in the rest of the country. London didnt need it and therefore boomed. I suppose what I am saying the rest of the country reacts to UK economics. London reacts to world economics.
  5. Couldn't agree more. My wife who is from Camden Town originally thinks I am crazy to want to spend my time sailing, travelling, doing adventurous stuff with the kids, sport etc. Its only about work and buying property! Maybe a little light relief of going to a museum and and overpriced and overcrowded posh cafe!
  6. Well it seems like its 10 years that I have been a member on here. Haven't posted much for the last 5 years though................... I lived in Central London, and was convinced of a forthcoming crash well before I "found" hpc in 2005. We bought a flat in Brixton for £97k in 1997, (joint income about 80k!), then kept that and bought a flat in Bermondsey for about £320k in 2000, in what we thought was stretching ourselves to the limit kind of a way! Current values probably £300k and £800k conservatively. So we wanted a family home which we couldnt afford in London in 2005 so moved to Edinburgh and now own a perfectly nice house in a great area, good schools etc. I have a successful business and my wife is doing a PHD at Edinburgh Uni. So all good and miles better than if we had stayed in London. However from a financial perspective we lost out on about £500k of growth in property values. So we would have made more money just sitting tight and eeking out a crap existence in London. Now I can understand a lack of sympathy from anyone on here who cant afford a house. Its a disaster having high house prices for anyone. And to be honest the kids are better off out of it as London prices skew what you think you will do with your life. A mate of mine is bemoaning the fact that if he sells his small 2 bed zone 1 flat for 1.2m by the time he has paid off his mortgage he wont be able to get anything inside zone 3!! Bonkers! But my point is that London IS different. I was watching the Jaques Peretti program on the TV last week and it is clear to me that in London you are not competing with the UK for houses but the whole world. So the economic rules go out the window. So my advice (which I am sure people dont need) is dont think about the London market the same way as the rest of the country. Ie inflation up - interest rates up - prices down etc etc etc as there will be a Russian oligarch standing behind you happy to park his money out of his country. I imagine that a Russian oligarch wouldnt even care if the values went down by 20% as his money in property in london is not taxed and is safe. The non dom rules are a joke. We are one of the biggest tax havens in the world. But I cant see a Russian Oligarch wanting to park his money in Aberystwyth. London is what they want. Cheers Rob
  7. If the rent covers the mortgages etc I would keep them. I think in the long term London will outperform everywhere else. We sold in london 8 years ago. Bad mistake! SO what if it goes down 20%? I think most of the sell pressure on here comes from people who are not in the market. I would stay in it if you can.
  8. OK maybe Islington was a bad example. A nice area of London 50 years ago was probably quite expensive!
  9. I have been a bear since 1997 when we first bought in london. I was an IT contractor and my other half was a trainee doctor and we bought a plce of 94k, didnt want to stretch to 137k. All I mean is that we are not going to go back to those sort of prices. I think it was around 1997 when Buy to Let mortgages came in. The yield where we bought in Brixton would have been 10-15%. That's one reason why prices went up so fast. I then got cold feet around 2005, sold up and moved to edinburgh. Was convinced it was going to be armageddon. Since then the last place we sold has gone on to double in price. I think there are many things, not least governrment policy that prop up London prices. So by all means plan for a crash. But it may never come. I truly think it is different now, in that at this meeting I asked the guy what the natural base rate should be. 5% he said. Cue indrawn breath from everyone else in the meeting. The population at large think interest rates being low is a good thing. Aint going to change soon. I can see London going up another 20% and then crashing 30? Whats your best estimate. All the estimates on this site for the last 10 years as far as London is concerned have been way out.
  10. I was at a meeting with a regional agent from the bank of england last week. Hell will freeze over before they raise rates significantly. 0.25 % a time if you are lucky. So I have bought an off plan place in London!! Only logical thing to do! If prices go up by 50% I am ok. If prices go down 50% I will sell at a loss and buy a better place at 50% off. London is never going to crash in a big way. I think people forget that it has always been expensive? I am not sure a teacher could have afforded a nice house in Islington 50 years ago?? If we had kept 2 flats we owned in the mid 2000s and not sold and moved out I would be retired by now at 45 (and bored you might say!)!
  11. If no annuity I read 4% safe withdrawal rate as someone mentioned already. In the USA they seem to understand these things much better. Great calculator at: http://www.firecalc.com/
  12. Well we sold 2 places in London in 2005 and 2007, moved to Edinburgh and on paper are now about 500k worse off than if we had stayed. Problem is that i cant see how we could have done any different. I used the profit from the move to set up a business that now supports our family. Also my mate who stayed might now live in a flat which he bought for 400k and is now worth 700k but he is still trapped! Who cares how much the house you live in is worth??!! Why does it matter! Just enables people to get more debt! We now don't have a mortgage and can save money. Though of course what i am going to do is buy a flat in London!!!! Its a curse as even after all the above i wish we hadn't sold in London!! For some reason unearned income seems so much better to everyone than being productive!!
  13. OK but say the bubble bursts, there is so much demand that people would start buying even if prices were falling I think. As not everone is in it to make money, some people just want a place to live. The other main piece on the news was on south east airport expansion, seems the government has no interest in the regions and the south east will just keep getting more congested and more expensive. Crazy really when the rest of the country (bar maybe birmingham and manchester) is empty!
  14. Well I am off work sick and there was just an item on the London news about the Walthamstow bubble!! Prices up 50% in a year! The only thing about London is that I have been waiting for the crash since 2004 and dont see it coming any time soon. There are so many people waiting to buy that even if the prices dropped there would be massive demand. Luckily I now live in Edinburgh. Wont ever own a million pound house but then again I have a great house, can go sailing after work and dont have to go on the tube or sit on the M25!!
  15. Pros and cons? Pros: Cheap Doesn't look rough Nice by the dock Cable car! Crossrail in 5 years at custom house Cons Nothing there Under flightpath Anyone know any more????
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