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House Price Crash Forum

UNSHURE

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About UNSHURE

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  1. 10 year mortgage - because I am nearly 51. I also have a SIPP with quite a lot of funds in which I can draw 25% of (tax free) when I am 55. I figured that if I continue to save a bit more and/or overpay a bit, by the time I get to the end of the five year fixed interest period, I may be in a position to pay off the rest - or at least pay off the bulk of the mortgage. Wage rises at my firm are not guaranteed. They have been around the 1.5% level over the last two years. This followed a pay freeze year in 2008. Why worry about a £1.5k tax - because it's £1.5k. The deposit will be hard enough to get together. I will have to sell strategic investments to put that in place! The point is - the government is trying to get first time buyers into the market but is now going to start penalising them with a hefty tax for the privilege.
  2. If the government re-introduce stamp duty for first time buyers of houses under £250K, will this put them off buying? I am a first time buyer and seriously thinking of buying next year. I have a big deposit, steady job etc. I nearly bought an house earlier this year. I viewed it three times. When I went to the bank to ask about a mortgage, the mortgage advisor said that I just the type of customer that they were loking for and gave me a 'loan in principle' no problem. However, in the end I came to my senses, The house was not cheap and needed a lot of work doing on it. I came to the conclusion that it was 'poor value for money' and would be 'buying a load of trouble'. I have seen a very good place that might fit the bill. It is a property that doesn't look like it needs much work doing on it and I can see the value in it (big garden, modern garage, very nice inside etc.). To buy this, I would need to put a fair chunk of my savings into the deposit. Following that, the mortgage payments would take around 55% onf my income (based on a fixed term over 10 years), I still think that the price is high. One of the other things that might put me off is the costs of all the other things associated with moving house - survey legal fees etc and the general costs of moving. If the government re-introduce stamp duty, it will be the' straw that breaks the camels back'. It's hard enough getting together the deposit and other cost of moving. If the government are going to heap another grand and a half on the top of that, I think that I'll stay renting for a year or two more (or longer).
  3. It's a question that is on my mind too. I had to queue at the petrol station for about ten minutes this morning. There seems to be more cars than ever - many of them SUV's. I think that 0% credit deals on credit cards has a lot to do with it. The punter just moves at the end of the 0% term. I can't see why banks would take on a customer who wants to transfer from another 0% deal. What are the banks making out of it? Nearly everyone in front me in the supermarket queue pays with a credit card. I wonder how many of them settle the balance at the end of the month?
  4. Thanks. I thought that there might be some sort of difficulty in purchasing a property that is unfit to move into. This doesn't look like the place for me then. I don't want the hassle. I don't think that there is anything untoward. The property is an estate. The elderley man who lived in it went into a home over a year ago. I think that the property had just got run down. The relatives have taken all the carpets up, and the two bedrooms and main room are now just empty rooms. They would be easy to decorate. The problem is that it needs re-wiring. There is no cooker circuit and few sockets. Also, the owner informed me that the old man used to try to fix things and that there could be some dodgy electric work. The sockets ar e also sticking out of the wall and look dodgy. I think that the owners will need to get a lot of work done before they can sell it. The may have difficulty in selling it to someone who is buying with a mortgage.
  5. I have had three viewings on a small two bed bungalow. It looks to be structurally sound; has well maintained gardens; is in a rural location and has a terrific view, The price looks to be well below the price of similar properties that are on sale in the location. I also have a big deposit and an offer of a 'mortgage in principle' from the bank. The snag is that inside, the property is not currently fit to move into. It needs a lot of work doing to it. It needs re-wiring; a new kitchen, a new bathroom; every room needs re-carpeting and re-decorating; a new fire in the living room; a TV ariel; a new outside door to the kitchen and numerous other jobs. The kitchen space is also tiny and it would be very difficiult to fit a kitchen. I was thinking of buying the property and then continuing to live in rented accommodation for a month whilst I worked on it to get it in a fit state to move into. I would also take some time off work during this month. I could fit the kitchen and bathroom myself and also do the decorating. However, I wouldn't be able to start doing much until it had been rewired and I would need to hire an electrician for that. I am thinking of putting a very low offer in since several people have viewed the property but no one has yet made an offer. My question is, what would the Banks valuers make of the situation? Would they insist on jobs being carried out before contracts are exchanged? Would they provide a mortgage for a house that is not currently fit to live in as long as it meets their valuation? Does anyone know what sort of things happen when a valuation is done? Do the bank then come back to you with a list of conditions?
  6. I was interested in a house that I saw for sale on an Estate Agents Website. I went and had a look around the area and the house seems to be a decent buy. A few days later, the 'For Sale' sign came down. However, the house remained For Sale on the agents website. Still for sale a few weeks later, I rang the Estate Agents who informed me that it had been sold (no sold sign ourside though). They then asked if I had a house to sell to which I replied no. They then asked for my contact details. Two weeks later, the house is still for sale on the agents website. Does this seem like some sort of trick that the state Agent is trying to pull or will it just be a case of them not bothering to update their website?
  7. I would like to have a go at answering that. Sadly, sooner or later the public sector will have to be cut back dramatically. We need a strong 'wealth creating' 'tax paying' private sector in order to sustain the public sector. Public sector debt is unsustainable in the long run unless we create the wealth to fund it.. Increasingly printing money and borrowing will eventually impoverish almost everyone. Things that I would cut back on now: 1. Bring troops back from Afgahnistan and Iraq. 2. Stop the bank bailouts (but continue to guarantee depositors). 3. Stop quantitative easing. 4. Stop schemes that are targetted at keeping the housing market artificially inflated. 5. Restrict the NHS to treating illness and injury. Let other things(e.g. 'tattoo removal'; and a host of other things) be provided by the Private Sector. 6. Reduce or eliminate unnecessary form filling to free up essential public sector workers. Police, nurses etc. should spend very little of their time as office workers. 7. Completely re-vamp all unfunded public sector pension schemes. The current situation is that there will be hundreds of thousands of public sector workers retiring on unfunded final salary pensions in the coming years. This is a public finance timebomb. 8, Curb public sector pay increases to be in line with comparible positions in the Private sector. 9. Stop waisting money on expensive computer projects. 10. Stop waisting money on expensive new Health Centres and other public buildings. 11. Stop trying to manipulate the economy with schemes such as 'cash for clunkers'. 12. Cutback on council services that are toothless and useless (e.g. environmental health). 13. Legislate to make it more difficult to sue public authorities over every little thing. I'm sure that there are many other things that could be added to the list.
  8. What concerns me is Public Sector Final Salary schemes. As far as I know, there is no big pension pot to fund these, just the tax payer and government borrowing. In addition, the number of public sector employees reaching pension age will rise substantially over the next few years. To renage on these pensions would probably be political suicide. However, if we have significantly high inflation over the next decade, perhaps the value of these pensions will be inflated away. Especially if the index linking does not reflect the true inflation rate.
  9. "What we want is irrelevant. The price will be determined by long term issues of supply and demand. The UN forecasts a population increase for the UK of 12 million people by 2050. There is no way we will build the additional houses required in time to avert massive HPI. No way at all. " 1. The year 2050 is 41 years off. The housing crash will occur over the next five years or so. 2. The forecast of the UN is not a fact. The UK has a rapidly ageing population with the huge 'Baby boomer generation' on the verge of retirement. The effects on the UK economy of this, over the next ten year, are likely to be profound. Japan had a similar ageing population when they went into their 'double decade slump'. House prices were savaged and depressed for years. Consider this also. Japan had savings. We don't. Japan were world leaders in manufacturing, we arn't. 3. Demand needs to be effective. We need to have an economy that invests and earns it's way to affording higher house prices otherwise the prices will have to continue falling for decades.
  10. When interst rates do rise the Banks will be more likely to lend. Also there will be more homeowners wanting (or having) to sell. At the same time, higher interest rates will discourage buyers. It is likely that this will be the time that there will be 'For Sale signs' up all over the place with hardly any buyers.
  11. There are too many props at the moment for people to bother about the 'state of their finances'. Credit cards is one of those props. People can just put their weekly food bill etc on the credit card. As long as they can pay off the monthly payments, no problem. They don't have to worry about money. Another prop is state benefit. Many families figure out that living on state benefits will give them a better standard of living than their capabilities could achieve in the world of work. Whole companies and corporations (and their employees) are also benefiting from state finance. No need to be efficient and profitable if the state will bail you out. The question is, what happens when all those props are removed one by one? And they will be.
  12. Could be. The point that I was making is that the belief in 'house prices always go up' is still well intact in a lot of sheeple mindsets. I still hear phrases such as 'my house is my pension'; 'there is a shortage of supply'; 'there is pent up demand'; i'me saving for a deposit and intend to buy next year etc. They tend to give examples of how much there house is worth now compared with a few years ago. They also give examples of people who have become very rich through btl. If somehow, a way could be found to put money into these peoples hands, at the present time, it is most likely that the boom would recommence because many people still think that housing is a solid investment opportunity. The mindset is still intact. However, there will come a time when the majority of sheeple realise that this market is a dead duck. The banks are reluctant to lend because they know that house prices are too high and therefore risky. The government and BOE should put interest rates back to a reasonable rate (say 5%). They should withdraw any schemes to increase prices and then let the whole thing collapse. We can then get to the bottom quicker. With a reasonable interest rate and reasonable prices, banks would then start lending again.
  13. There is probably a few reasons why prices aren't coming down rapidly. 1. Prices have fallen around 15% in the last 18 months. Thats not bad going since house prices do tend to rise and fall slower than other markets. So the crash is on course and will probably last for a another three years or more (in real terms). 2. There doesn't appear to be a lot of housing for sale on the market yet (at least where I live in Halifax). As I drive around, there are not many 'For Sale signs' on display and I have seen a number of 'sold signs'. At some point, the number of houses for sale is likely to increase. Forced selling through unemployment and debt difficulties is likely. There could also be a BTL exit panic before long. Once there are 'For Sale' boards up all over the place, people will be forced to lower the price to sell. 3. A lot of people think that recovery is just around the corner. Some of the people where I work are of this opinion, They think that House prices will start going up again and the boom will recommence. This illusion is likely to be shattered at some stage. People will then have to start pricing realistically. 4. Government interference and government belief that permanently escalationg housing prices is a 'good thing'. This manifests itself in low interest rates and schemes to encourage home ownership. Eventually, low interest rates and quantitative easing will cause problems of their own. Interest rates will then have to rise.
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