Control Freak

It was trading at around 1.94 a week or two ago.

I am working over in the US at the moment (as an engineer), and can say from my experience that the UK/Europeans are better overall. Is this because most of the 'Bright' americans go to law/medical school to earn millions, leaving the other areas lean? I also think that the UK/Europeans have had to be adaptive, and change working practices to become more competitive. They are now ahead of the Americans, who generally get by, by throwing bodies at problems. Americans are very resistant to change (which surprised me greatly), much as the UK was in the bad old days. This is just my experiences. CF

Agreed. It does not prove anything (how can it?). It was a rather ambiguous title anyway. I did, however give a personal example of exactly what the article was referring. Please refer to my earlier post. I am sure that I am not the only person who has done this. I would imagine that this practice is widespread - get 5 - 10 years into a 25 year mortgage, the repayments are now lower (as a % of earnings), so remortgage and pay it off earlier (especially as trading up is too expensive at the moment). Not everyone is on a credit binge, I am sure that there is still some sensible people left out there. If this article encourages people to pay off mortgages early then that is a good thing. You have eloquently proved my point. The subsequent points made are generalisations (of which I agree with), but do not invalidate what the original article said. Too subtle for me. CF

I think they have considered re-introducing it, but not for 2 years, by which stage where will HPI be?

Yes, but that is not what the article was referring to. This is good advice, and is true irrespective of high/low earners.

What has this to do with a crash/no crash?? My girlfriend (taking my advice) restructured (at a fixed rate) her mortgage to increase the payments so as to pay it off early (down to 6 years from 15). When I eventually buy a new house, I will be paying it off as fast as possible, with the likelihood of taking a mortgage on for 15 years instead of 25 (Yes, even if I bought at these stupid prices - I would just have to buy a smaller/grottier place - something that I am not prepared to do - so I am waiting like the majority of people on this board). This article seems pretty sensible to me. I think you are getting 'House Price Crash' paranoia. Control Freak.

Yes, but for the prime posting forums, the demand can only ever go upwards. Aah, but you are not savvy enough to realise that the real Pro's wait to pick up on a weak thread, getting a strong return. You have to take risks with the postings to realise a good return. The moderators are just jealous because they missed out getting in early on the choicest posts.

You mean another Labour Landslide

I was wondering the same thing for all other people logged on. I am over in the US, so it is 8.45 over here

Not necessarily. The Universe is expanding. What is fuelling this expansion?? Where did the initial energy/mass come from?? Nothing?? They only appear to be true at the macro level. It is when you take things to the quantum/sub quantum level that these 'Fundamentals' break down. If we do not understand how the fundamental building blocks of matter work, how can we say that (newtons etc) fundamentals are true (perfect)?? The 'Fundamentals' that you take as gospel today, may well be redundant as our science and evolution advances.

Yes, it was a uni thing. Very Mathsy. Can be summed up by a famous mis-quote: "God DOES play dice"

What about Quantum Mechanics?? Physics has moved on from Newton.

It most definately NOT STUPID to transfer the CC debt to their mortgage - the interest rate differences speak for themselves. Just did some maths: 10K put on repayment mortgage works out at 59gbp per month over 25 years @ 5% interest. Total of 17,770gbp extra for lifetime of loan. Not too bad, and definately better than keeping the debt on a CC. To rack up the CC debt in the first place though.......... That IS stupid.

You are just proving my point here. You dislike him more for being a LL, than for having Bullish views?? Perhaps you are just "Tired and Emotional" Funny story though

Yes, but that is the weird thing - I do not agree with your Bullish views - I have bearish views!! I do however give merit to your posts on the BTL game, and how to succeed doing it - i.e. Yields etc. I can believe you when you say that a downturn/crash in house prices will not have a significant effect on your business - if it is as you say, based on rental yield rather than HPI. People on this board have a tendancy to treat you as a pariah more for being a LL rather than having Bullish views. Strange.

Huh?? Shurely shome mishtake??

Ta

I read the linked thread on SP before Yielmans' (aka BBB) posts were deleted, and found them quite entertaining. I did not interpret them as offensive in any way, so I do not get why people are saying so. What I do find offensive is for people on the one hand to slag off BBB for being abusive, and then post "P*ss Off" etc. in their own messages. Are you people that dumb? Double standards? As other posters have said, this board is becoming boring ("same old pap"). CF

............But you would be buying at the bottom!!!!!

It would be nice if it showed the next release date. CF

The house prices over here in the US are also overvalued (not to the same degree as the UK though). Estimates range from 30 to 50%. So, to buy can be cheap (on current/future exchange rates), but what will you get back after a few years should you decide to sell (if/when there is a correction)?. As other posters have said (DrBubb etc), the US economy has a similar credit bubble that we have in the UK - and the consensus is that it will all end in tears. That said, where I am currently on assignment (South Carolina), you can get 4/5 bedroomed detatched houses with all the extras etc for between $300k to $500k (depending on the area). This equates to roughly 160K to 270K GBP!!!!!. And they are OVERPRICED!!!!!! Good place/time to buy - probably not, if you are looking to minimise any risk of negative equity. But for what you can get for the money, it sure is tempting. Anyway, I am back in the UK early next year, so will have to wait for 2-3 years before purchasing there. CF

What part do the banks have to play in all this. It has seemed (in the past, certainly) that they have been reluctant to back entrepeneurs in this country. Take the case of Dyson, for example. We have some of the most innovative and creative people, yet this does not seem to get transferred into wealth creation for this country - these ideas get used elsewhere (America, for example), where they are prepared to take a risk on success. We are a country that excels in 'Innovation, design and research', yet is awful in following through the fruits of these labours. The banks seem to be biased towards lending ridiculous amounts of money (multiples of income) towards property, which they see as a safer bet than lending towards business. CF

-17.87% Well, I can dream!

Thanks for the reply BBB, I suppose I was putting you on the spot somewhat - as you say there are endless Q's. I was thinking that the investment yield should be 'nett' more than I would get in a 'risk free' environment - this would take into account any changes in IR's (what risk factor do you assume for IR increases - say them going to 10%??), Empty periods, repairs etc. Reading between the lines - 10% yield should be an absolute minimum (subject to change in 2/3 years) Current thinking on property/timescales/goals: 1. Property type: 2 bed flats/terraced < 100K (I would rather have a number of lower priced properties than 1 or 2 higher priced - spread the risk) I appreciate that there are no properties for these prices (or crap ones) in these locations for this price at the moment, but I will not be looking to purchase unless the prices drop (significantly, in some cases). UK regions: Cheshire(Wirral)/Hampshire(Portsmouth) 2. Timescales: I will not be looking to buy for at least 2-3 years (bottoming out of the bear market). If prices do not drop sufficiently, then I will not buy. I should have about 80K to invest at this point. Start off with 2 or 3 properties for the first year - get the hang of it etc - If it goes tits up, then I shouldn't be too badly burned - if all goes well, then expand. I will be looking for long term investment (>10years) 3. Goals: Purely long term - develop a property portfolio that will generate income for expansion if prudent to do so, invest in other (safer) environments if not. By buying at the near bottom of the bear market I should also have a 'Paper' profit wrt increased house equity (long term). I know all this is somewhat dependant on timing the market correctly (and the market doing what I hope!!), but you asked for more info. Please be aware that these are just my initial thoughts/ramblings on this, and as I have stated previously I will do extensive research (2-3 years to do it!!) before taking the plunge. Any comments BBB - am I being a bit too 'Pie in the Sky' CF

Hi BBB, Thanks for the response - cleared up my question on gearing - looks like I was 'way off beam' . wrt 'buy prop for 200k spend 35k on it (extension) worth 300k 12 months later.' - you are a fan of property ladder then!! . I guess it comes down to my initial question of what is the 'critical' point at which the BTL investment becomes worthwhile (even in a falling market & negative equity - scenario 1). This is what is of interest to me - what are the key criteria that I should be looking for/ways of minimising any risks. I am a bear at heart (hence I am posting on this site), and will thus probably try and wait for scenario 1, but I would like to know (in a falling market, again, humour me on this - all hypothetical here) what this 'critical' point is, so as to judge how 'good/improved' the investment prospects are in a falling market. Would you recommend waiting till the bottoming out of the current market before investing - that is my current thinking?? Cheers, CF