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Orbital

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Everything posted by Orbital

  1. Why do we need an alternative. You can just as easily re-write the above to say something like - we can buy a house by borrowing an amount of money we plan to repay by working hard for a living and aiming high. We will pay off the place by the time we are 50, we are fit and healthy sensible people and will lead active lives into our 70s. As we wind down we will make use of the pensions we built up from the day we left education (starting that early makes all the difference!), we'll be surrounded by friends, family and loved ones. An who knows, parachuting out of the sky! I plan to do everything to make sure my life is like my version. I realise that maybe it will end up like the depressing version, life is hard and we've all had our fair share of blows I'm sure. But I think my chances are good and for no special reason. I wasn't born into a live of privilege, I don't have an awesome job or a Fred sized pension to look forward to. Just a normal guy. But so far so good as I head into my 3rd decade There are societies that do not allow mortgages. This is thought to hold them back. Lending can be a good thing . The farmer can borrow £10 against his land to buy a plough to grow more food to pay back the debt and provide for his village. In our world, maybe that means buying a car so we can get to work to earn money to... etc. The next guy gets it... Couldn't agree more. As someone who resolved to buy as soon as I could after completing my education I see the total sense of this. I'll be debt free before I'm 50. Nothing wrong with working - I enjoy it and most of us here are pro working for a living (aren't we?). But I'd rather get that over and done with when I'm young. So yeah I wasn't able to drink through Uni, I don't go to the gigs my mates do and *gasp* I dont have a mobile phone contract! But actually I can now start to afford these things whilst some of my peers are taking stock and realise they have 10 years of saving before they are where I am. Who's fault is that though? Even small overpayments can knock years and years off that figure of 25 years. Sorry to OP, but getting a mortgage does not mean signing your life away. Unless you get a stupid one. But we are the bright ones on this forum so no danger there !
  2. I know this wasn't really the point, but in this new paradigm of cognitive science the connection between lateral eye movement and brain activity is long since debunked. Unfortunately a large number of us are stuck in the age of American 1970's couch psychology. Or maybe you believe this stuff. Thanks to Google we can learn for ourselves http://scholar.google.co.uk/scholar?num=10...amp;btnG=Search Anyway, just popped into my head. Carry on
  3. I would say you are in a good position, although I don't see your age in this 1st post. I came out of uni, began saving 1000s a year, each year that goes past you should earn a bit more, save a bit more, invest it watch it grow (ok growth is hard atm but it's always cyclical!). I was always a natural saver so it was easy for me. After getting kicked out of a rented place (on a LLs whim) I resolved to buy. It wasn't easy, it took years. But lets say you can save 10k this year, and the same or more next year etc. Well soon you will have 50k in the bank. Try and earn a secondary income, I earn a couple of extra K every year through Internet sites - takes very little time and the taxman takes a fair share but it can make all the difference. My grand parents saved for 10 years before they bought so don't think this is a new hardship!! My own parents moved to their family home at the age of 34. Our "have it now society" has forgotten how to save and wait - so don't give up! It's all very normal! A graduate round my way (London) should be earning about 30k after 5-10 years, assuming you are a hard worker and go for promotion. Its not unreasonable to aim higher? So a 4x mortgage should be affordable with current interest rates, 120k plus 50k - a 170k pot. In my road, suburban leafy surrey/london boarder that will get you a small terrace house. Prob all you need to begin with! Lets be realistic at the start. The modernised semis in my road go for about 250k so even they come into reach if you are an achiever. So then you meet someone, get married, want a family. Well now you have 2 incomes and a pooled deposit. It's all achievable. I am a recent grad, I didn't earn all that much, I bought a house (2005). I over pay my mortgage, I contribute to a pension, it's all good. The key thing is - start now! You have a choice - cross your fingers and hope prices move in your favour whilst posting here and watching the rest of the world get on with their lives, or take control and steer your own destiny. If prices do plummet whilst you are saving - you win twice ! I know some of my mates who came out of Uni and splashed their cash for a few years "life is for living" and all that. So here we are heading to the wrong side of 30 and they now have 10 years of saving to do and are moaning about how unfair it all is. I'm not all that sympathetic. Well I've done my 10 years of saving and can chill without having to worry any further. If prices come down it will help me make that jump to my ideal house. If not well I still can offer my kids their own room and a garden. It's great when you make an overpayment on your mortgage, you can chose to see the loan length drop away or I prefer to see the payments come down each month. Imagine your rent dropping a fiver each month - all adds up after a few years ! Banks aren't so bad LLs!
  4. It must be hard for readers here because they have had the same message for 5 years or so yet these massive drops still haven't happened. I think you can see them actually if you are looking for new built flats. If that's your dream house then you are sorted. An anecdotal tale I heard yesterday from a family friend, arguably typical of my parents friends - they had their place on for 450k, and their best offer was 350k. So that's what its worth blah blah. Well they just thought "why sell". They were looking to downsize and buy something smaller but if they can't get a good price then they are just going to say "fair enough we'll stick with our big garden and the space to have our kids and grand children over at Christmas". So now the house is off the market. Doesn't bother them. They bought the place in the 80's for virtually nothing and their mortgage is long paid off. They'll just sit in it until they die. As someone who is in a "starter" family home looking to move to a "forever" family home I have long suspected that the houses that we all ideally want (detached, driveway, 4 bed, garden - nothing ground breaking) are simply in short supply - they aren't coming up for sale. The global economy is irrelevant if none of these people are selling. If the banks start giving money out again we'll just be back to square one, a handful of people who are prepared to take the risk will chase the small number of properties available. Meantime our lives have passed by . On the plus side, it's Friday and I have a £4.99 bottle of wine in the fridge waiting for me
  5. Yep I do too. Although a fan of this site I noted that the original owner was onto a good thing and thought my time was better spent writing my ramblings on my own blog rather than engaging in arguments here. The irony is that rather than spending time on this forum I secured a second income that has paid off a proportion of my mortgage and saved 10000s in interest! I can't help wondering if other priced out people with rather large post counts could have done the same. 5yrs ago there were some great domains available and this topic was so easy to start up in. Tough to impossible now . Another missed boat for some maybe?! I think if you didn't already know the answer you want then you wouldnt ask that question here! The doom and gloomers will tell you the pound is worthless so you may as well hold. I'm more interested in cashing out now - but like you everything goes into an account to ensure I can pay the taxman. Bah! I guess the difference is for me it's just a bit of a bonus, I rely on my day job to survive. I also don't believe the world is going to end. A strong HPC message whilst waiting for the bust was "everything is cyclical", and I believe that is still true, so the pound is weak now but for how long? Could be a good time to cash out? Who knows for sure! Still, I'd definitely recommend site building and adsense to anyone here who needs some extra cash for a deposit. If you post regularly here then you are kind of already doing it except the money goes to the owners of this site. Nice for them - free content written by us! Sign up to blogger.com, read problogger.net from start to finish (stay away from rich quick schemes!), get your own site going, with some hard work you can pay your way through uni, get out of debt, buy a house thanks to your work and not just circumstance - get back in control . Or you can keep posting to other people's sites and watch funny cat videos on YouTube ! There is always a choice. To the OP - good luck with your sites
  6. I think the massive flaw in this thread is the failure to recognise that borrowing money can be a good thing. Debt is a dirty word on HPC and it just shows how low the level of debate has now sunk . Lets make it clear: there is not anything necessarily wrong with being in debt. The ability to borrow against ones house is very important and actually a reason that certain communities struggle to progress. For example in certain areas they have no concept of ownership, land is communal. Great - I imagine some of the less forward thinkers here will be thinking. But no. This means the farmer can't use the land to secure a £50 loan which they use to buy a plough and some goats which they use to produce more food than they need so that they can sell it to others who can then make a living by performing other tasks and not having to scrape the land. This means people can become authors, artists, doctors etc. I learnt this in Geography class at the age of 11! It's not that hard is it?! So there is nothing wrong with extracting money from your house to fund a new venture, there is nothing wrong with borrowing money to put a roof over your head and keep your family sheltered. If you need a car to get to work so you can earn money then there is nothing wrong with a car loan! Ever heard of the chicken and the egg? Debt gets round that problem. Borrowing can be good I would argue that the problem is when people rack up 1000s on their credit cards, spending it on beer and holidays with no long term ability to pay it back. This is very different to sensible people who borrow within their means and know they can service the loan either by selling the asset or working. Of course readers here will go on to say that the whole of the UK is made up of the irresponsible borrowers. More considered people will know that actually it only makes up a small percentage. It's certainly not me, and it's probably not you either? So yes, there is good and bad debt in the sense that we use those terms to describe how likely the debt will be paid off. But there is also good and bad in the sense that borrowing to better ones life and invest in human capital, education, etc is totally right and important for sophisticated economies. And there is the bad debt in the sense that taking out a loan to fund your gambling habit when unemployed is not healthy for anyone. So maybe OP's friends are just making this distinction. Their debt is controlled and sensible. Move on, nothing to worry about
  7. Given that no new homes are being built, our birth rate is the highest in recent history, people are living longer, immigration is still happening, etc. We need all the places we can get. Anyone converting empty property into habitable homes should be applauded. If people thought about it for 2 seconds they'd realise this actually helps the cause
  8. I do agree but I also think that actually this is an effect not a cause. Double income couples are able to spend a lot on housing. Single income couples can't compete. Both partners in a couple didn't start working so that they can spend more on a house, they started working because women wanted a career (and why not of course). They then found they had more money and as is normal in the housing market people spend whatever they can. A couple on say 25k each are bringing home £3k a month. Once both over 30k they are bringing home 4k a month! Given that living costs are reasonably fixed for us all that means their disposable income is rocketing each time one gets a promotion. A couple that pools its funds is going to be able to fund a big mortgage and they will go and get the best house they possibly can! So imagine one parent at work, lets say the couple has £1000 spare each month. The other one just needs to bring in £1000 a month (not hard with min wage these days) to double their disposable income! That's 100% more than the other couple with one bread winner! I think this is why it is so hard for a couple to stay economically competitive if just one parent works. This is the difference between our time and our parents'.
  9. Reminds me of me at Uni, I spent very little as I knew it would be tough when I came out and had set myself the goal of clearing debts and buying a house (which all worked out well so it was worth the sacrifice imo - set the foundations and security for the rest of my life but that's another story!). But once or twice a month Id treat myself to a Chinese. I remember it being about £5 (which always felt like a massive amount of money when I was used to super cheap, yet healthy and tasty, rice/pasta/fresh farm produce, etc) and that was coming up to 10 years ago now (yikes!). So to be fair I think we've done well to avoid inflation in this sector until now. Enjoy the curry!
  10. I agree in the sense that those in a good position can still rock up to a bank and get a mortgage. However it's not just mortgages. Small businesses are turning away orders because they can't get the money to buy materials up front. Companies know that they can turn 50k into 60k but what's the point if they have to pay 11k interest or maybe they can't get the cash at all. Why 3x? When I got my mortgage in 2005 it was 5x. I spend so little on myself that I was able to over pay and here in 2009 I am glad I went for it. Each overpayment brings down my monthly "rent" (its come down literally hundreds in the last 4 years!), reduces that multiplier, and builds up a period of payment holiday. So I don't get where the bank went wrong in my case? Surely everyone is an individual? A person with a car loan, gym membership, sky and a phone contract probably has 30% less to spend on rent than I do. I thought this site was in favour of giving hard working savers, like me, a break? Why should I be punished because others can't manage their money! Maybe that's where I am going wrong - perhaps I should just spend all my cash and expect the world to adjust to fit me. I dunno. Anyways, good luck all - hope you get what you are after
  11. Why is the start date relevant? Doesn't that make it worse, at a time when many were feeling positive and enjoying the good times there were a core that were miserable already. If they are miserable when times are good then heaven help them when times are bad lol! I think the quote is a fair point. As a genuine optimist I have always felt out of place on the board and it is undeniable that the majority of users here are a certain, how shall we put it, "type". It often doesn't suprise me that the overwhelming feeling here is that house purchase is impossible. It's not, and never was but some people are just pre destined to gloom there way through life. I learnt a long time ago just to accept that, but it does fascinate me as to what the difference is. Probably hormones.
  12. http://www.metro.co.uk/news/article.html?T...p;in_page_id=34 Scary time to be renting. It happened to me actually. Being forced to move your life at the drop of a hat is not all that much fun. One of the reasons I would gladly pay more to buy. I just think it's a better deal and therefore worth more money - but we all have a different outlook so ho hum How safe is your place? Yeah yeah I know YOUR landlord is fine - no probs with their finances. Well as the OP points out, what exactly do you expect them to say ?!
  13. And then they'll just show you a copy of this: http://www.metro.co.uk/news/article.html?T...p;in_page_id=34 Glad I'm not renting tbh. But each to their own You could try one out each week perhaps? Just as well there is not any other factor to consider when moving house other than the amount of rent or anything.
  14. I think its just a sign of what many have predicted. Sellers aren't interested in selling at a loss, and they don't need to sell. I look at my folk's and their peers, they are the ones with the nice 5 bed town houses that im interested in but they are all pretty fit in their 60s, and love having the space for the grand kids. And of course we all have to go to them as they are the only ones with a house big enough to get the family together in. They love it! With low interest rates and low mortgages they are under no pressure. I have to agree with the article in the respect that where I am the nice houses that we all seem to want just aren't on the market Sure I can grab a cheap flat. But that's kind of a backward step. Fortunately my place is big enough for a small family but some of my friends are stuck in flats now. Just had their first kids, can't afford to sell, no one wants to buy as they are waiting for cheaper house, but houses aren't changing hands. I realise this is just where I am in S.London/Surrey. Anyone else having better luck?
  15. Yeah exactly. Surely having 250k in cash is the worst place to be in a high inflationary environment? It is surely a nonsense to think that house prices are going to fall nicely down to a hoped for amount. Doesn't everyone want a 500k house for 250k? I do! Is there one available for each of us? I'm guessing no. Plenty of luxury flats around though if you want one of them? No, me neither! But why are we all stuffed? Having gone against the HPC advise when I first starting reading this board about 4 years ago I went and bought. Have enjoyed low interest rates and over paid nicely. I even grow my own potatoes in the garden! Sure it took hard work, a bit of a risk, some sacrifice etc but now heading into the next phase of my life, the dreaded 30s, I am not even slightly worried by all this. I think the people who are in trouble are those that never committed to anything - and Id argue that is their problem But best of luck. Perhaps the OP can invest in building his human capital. In that way he will be in a good position to earn some more cash. I have taken to earning dollars over the web myself.
  16. A recession is defined as negative growth in a certain period. This has happened. Therefore by definition we are in a recession. You can't just go changing established definitions! He must be saying it's something else we aren't in. Or perhaps his mind is going, it happens to us all eventually
  17. I know this won't go down well. But the truth is I have two colleagues who are BTL amateurs. Both are now paying a pittance on their mortgages. Literally a couple of hundred on massive mortgages on multiple properties. They are both bringing in big yields. I wouldnt want to do it myself, I'd be worried (neigh, not worried, more like s***ing myself) about IRs going up again. But right now the bubble is far from bursting for them. Where did it go so wrong?
  18. see, always look on the bright side. I knew it would be fine
  19. Erm... You pointed out the answer in your opening line! There are more people in London. Hence more crime. But there are also more fantastic free cultural events, more concerts, more music, more pubs, more choice etc etc. It's not for everyone, some people are happy to sit at home and watch the telly every night or just arent interested in all the amazing things going on. Some people are happy to do the same job for their entire lives. Who are we to judge! As I get older my outlook is changing too. Between 20 and 30 its a great place to live as you feel at the centre of everything. But I wonder as I get older whether my priorities will change. But why not have the best of both worlds. My Surrey town is 20mins away from the centre of London, affordable and statistically one of the safest wards in the country. 20mins on my bike and I'm on the Surrey downs. I too don't understand why people cram into a £400k flat that is still a 40min tube journey away from where it is really happening when that amount can buy you my dream house in the suburbs. And it takes you less time to get to the centre! But like I said above, each to their own. If everyone else agreed with me then the houses I prefer would be much more expensive and I don't want that lol!
  20. So if he was less restrictive he'd have got the £700 he was after. Or maybe the place was only worth £650 pcm? Who knows.
  21. I feel like the kid in "the emperors new clothes". That graph seems to be going up right at the end! Woss that all about !
  22. You could end up wasting your own time. There may be some time to go before what you think a fair offer is and what the vendor thinks a fair offer is come into line!
  23. Tell me about it. I started following the forum back then too but ignored the advice and bought anyway. I've enjoyed low fixed payments, a great house, been able to add value, concentrate on my career and putting down routes. 5 worry free years. Obviously some people didn't have the choice because they weren't in the right place in their lives. But some people were and actively chose to wait. And wait. It's them I am sad for. Still at the end of it hopefully they will be better off. Hopefully. All that for a few extra bob in the bank - if things work out - I'm not sure its worth it but then of course those people probably value money more than I. Best of luck.
  24. This is ooooold news. Try reading "They F*** You Up" by Olly James. I still find it hard to believe all this isn't obvious to every one of us. Sorry, but I also felt this was a very odd thing to say. If 5 bed country houses in Surrey were really accessible to all then why didn't everyone live in one in the 60s?! I might be wrong, but I think a fair few people lived in flats and terraced accommodation back then? That said, my folks eventually managed that. They were both employed full time and eventually bought after moving 4(?) times up the property ladder, each time buying a wreck, doing it up and making a sideways move to another wreck. Years of hard saving, hard work and some risks with the mortgages. They actually bought their "forever family home" thinking they'd never pay it all off, but that was OK because it would mean me and my siblings would each get a room and a garden to play in ! But thanks to inflation their mortgage is now pretty meaningless. Imagine getting an I/O mortgage in 1980 (http://www.wwwk.co.uk/culture/housing/index.htm) - I'm pretty sure my dad was earning more than the average price a year by his retirement a few years ago! Read around this forum and you'll see this is exactly what people are not prepared to do. And maybe that's why they can't see their way from a 2 bed flat? You don't have to overstretch, you don't have to be stupid, just save and buy smart. I'm not even 30, I don't earn that much and I am now looking to buy a 4/5 bed house because I was prepared to play the game. If people can't make their move in the current climate then maybe it's just not for them.
  25. orly? Try putting in something erroneous then. You'll find that major topics are watched my an army of moderators who will check and validate the changes. But like any documents used for research you should investigate the source. If a wikipedia article isn't backed up with sources that you can check then discount it. Most are well sourced. It's a shame research techniques aren't taught at schools, although Id argue it is common sense. In fact I'd say wikipedia is a great starting point for research as usually the key authorities in the topic will be referenced. Which is more than you get from a newspaper or TV program. I suppose the difficulty is you have to do some thinking for yourself which is more than some might want to do (or are even capable of?).
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