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About fuzzy_bear

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  1. It wasn't money "flushed down the toilet" as it provided a roof over your head and in the circumstances, was the best option. However, you're right of course, it wasn't your roof and was never going to be. Was in a similar situation for a long time (moved a lot with work) but eventually bought in my late 20's. An apartment didn't appeal as you're at the mercy of what sort of "neighbours" you get. Started with a small semi in S.Belfast. Bought for 190k. Never looked back.
  2. I'm not sure what 40 years ago has to do with anything. Interest rates were 14% and Mars bars were cheaper too. Different times. We can live stuck in the 1970s or accept that while some things were better then, many were worse. If you are talking about mortgages, then the money has always been "magicked". That's how the financial world (i.e debt/loans work). Personally we moved out of London/SE a long time ago - we made a choice regarding quality of life, housing & school costs, disposable income etc. Where I live now (N.Ireland) average house prices are £125k i.e. 4.7x median single salary (2.3 times joint). Ratio is similar for large parts of Scotland, Wales and NE England. With interest rates near zero, a mortgage is considerably cheaper than renting. Money saved can be invested elsewhere or used to overpay the mortgage. It's up to an individual. Maybe someone living in 1977 could get a bigger house for the same inflation adjusted figures. If that is what "thinking it through" means I'm not sure that really makes a difference to my life and the lives of my family now so I won't bother doing the math.
  3. Bit of a lurker on here - rarely post but there was an interesting article by Kate Allen in the FT and she also featured in the FT podcast. "Think you know what your house is worth? Think again" Low transaction volumes creates considerable uncertainty and wide confidence intervals with regards to actual valuations https://www.ft.com/content/86fa173c-01fe-11e8-9650-9c0ad2d7c5b5 Thought it would be of interest to the HPC community. (*Disclaimer I'm not crashist in the strictest sense - I believe the market is overpriced (speculative even) in a number of places but affordable in large parts of the country and an uncontrolled nationwide crash a disaster for the wider economy but value debate.)
  4. Haven't digested the whole document but taking the graphs as is, it is so hard to disentangle all the various factors at play. For example, the decreasing numbers buying with a mortgage likely to reflect decreased affordability and conversely an increase in cash buyers. Top graph doesn't convey much if it is absolute numbers; Number of home owners increasing and more people renting could simply reflect an increasing population. Slope of the lines between owning outright and rentals is the same implying little change in the two groups and so likely reflects the population boom over the last decade. Will digest it all later. Thanks for link.
  5. It's all relative - depends on UK & US factors. Although there are a few positive vibes re Brexit trade agreements & low UK unemployment level, most of the shift seems down to devaluation of USD. - Political turmoil of Trump, worse than expected jobs figures, falling bond yields all seem have the effect of weakening the USD. Of course a lower USD benefits Trumps protectionist policies through making exports more competitive so may be part of his grand plan.
  6. An interest rate rise seems likely - most analysts predicting 0.25-0.5% rise in 2018. Unemployment levels are at their lowest in 40 years. 1.44mil unemployed is almost critical mass and will likely lead to competition in the jobs market. Firms will have to raise wages to attract/retain workers offsetting any small increase in mortgage repayments.
  7. So in summary: With the exception of London & the SE, house prices are cheaper in real terms than 10 years ago In a number of areas house prices are cheaper in absolute terms than they were 10 years ago More people are buying homes to live in rather than an investment. Almost resembles a normal housing market. Just a pity wages haven't kept up with inflation.
  8. I don't pay a subscription so don't have access to the whole article but could view enough to catch: "As a result, many people are selling and then renting instead of buying in the hope prices will fall even lower." Isn' that utter madness though - Why gamble your family's future in that way? Have those "many people" calculated how far would prices need to fall to even break even after incurring all the costs of selling and rental costs for 2-5 years?!
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