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Wannabebear

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Everything posted by Wannabebear

  1. Hi, just wanted some advice from people on whether to buy a property that is in good order vs one that needs doing up. A rough outline of my situation is below: 1. Im married with 2 children under 4 years old 2. We are searching in the Wokingham-Berkshire area 3. Our house criteria is 3 bed, decent garden with car parking under 250k. [This is rare, only 2/150 properties in our search meet this at this price point] 4. We are FTB's. 2 house meet our requirements, they are about 1/2 mile apart: 1. Victorian - 100ft+ garden, extended and extremely well finished inside. I have scoured the inside of the house and found a broken floor tile, that was it. The 3 bedrooms are a decent size for a Victorian house. We could move in and not have to do a thing. Built in dishwasher and halogen hob in a huge kitchen won me over... 2. 1950's - 50ft garden, backs onto school playing fields, which we don't mind. Needs modernisation, but not renovating. Could move in and live in it fine, would need to buy fridge, washing machine, etc. In time we would need to redo the bathroom and kitchen and knock 2 walls through. Needs a new laminate floor and the doors of the conservatory need replacing. Its been rented for 15 years and not maintained to a high standard so it is a bit tatty. We would do it up ourselves. Both houses are very equal in floor space. We can get the Victorian for 250k and the 1950's house for 231k. So 20k difference, or about 36k over the lifetime of the mortgage. A lot of people I ask tell me to buy the one that needs work. But the difference in payments every month is only £100. It seems to me like we could easily throw 5k at the house that needs doing up over a few years, it just does not seem worth it, plus all the time spent on it. What could be an issue for us is re mortgaging in 2 years time. If the value has dropped then we will struggle to get a decent rate as the LTV will have increased. I dont know if making the right choice in property can protect against this, vs the market situation as a whole. Of course we could rent (currently living with my mum which is not ideal) but that would be stuffing 10k+ away per year into a landlords pension fund. thoughts please? Nick
  2. Screw it, lets do it. If anyone has a better idea to show off the collective power of the people then please interject. To be honest, I'm getting pissed off with the whole thing, it cant get worse by doing this, can it? This deserves a facebook page to gather some momentum
  3. Just to clarify my take on paranoia; I am able to believe that the government does not want house price falls, as it would be politically unpopular. Besides, it is true that most MP's are also BTL landlords. I draw the line at the BBC removing posts mentioning high prices on its comments though.... Or that news stories are somehow created out of thin air to support high house prices. House prices vary massively from region to region. Please forgive this massive understatement. I live and work in the SE in electronic engineering. Any country neighbouring London is hugely skewed because its commuter belt. Its basically got to the point where I cannot really afford a house in my region of work. Its true Swindon and Bristol has small pockets in what I do, maybe i should uproot the family and move there. I don't see house prices falling in Berkshire as i do the same search every Monday, the labour market is too strong. Maybe I will be proved wrong in time...
  4. There was a thread on here a while back, pointing out the massive paranoia exhibited by some members on here. Wish I could find it again. There are many interesting comments on economics here but to suggest these people are being paid off by the CML? That the BBC moderate comments on high house prices? Please.... We should be happy that the BBC actually showed this at all. Its called raising awareness and its a good thing. The main blockage at the moment for FTB's IS the huge deposit requirements. After that, we have the issue of high prices in general. Now we could explore the argument that high house prices have inadvertently led to the deposit requirements but we are where we are. There is no way the government/banks/vi's will let house prices fall. Low IRs, extra support for BTLs - whatever it takes to support it. I have said it before about inflation, we will have to suck it up. Sad but true, so we may as well forget about it and get on with life. The banks invest speculatively with OUR money. They should be providing a socially useful function in return, as opposed to the ruthless pursuit of ever increasing wealth creation for themselves.
  5. I guess it depends on how many people are actually at the tipping point. We will all suffer from VAT, NI, inflation and base rate (i dont personally see them lifting IRs much at all). I did see a stat on mortgage arrears once. Maybe there should be a repo + arrears tracker on this site, unless there is one already!
  6. Really? Take my mother, bought at 25, paid off mortgage, now 65. Don't see her ready for a care home just yet...
  7. catmandu: This is kind of my point - who really needs to sell? When houses were more affordable and we had a fully functional ladder, people could progress upwards. So settle down, have a kid, get a 2 bed. Have another kid, get a 3 bed. Once the kids are out of childcare etc maybe they have some more money available, move up and get a 4 bed until retirement with a view to downsize at some point. All this is because they had the option to do so. Cant do that now so people will make do. Have 1 or 2 kids and put them in the same bedroom. My Job is now 2 hours away but so what, commute. None of this will kill people, it just makes everything a little harder. Of course, everyone dies and those properties need to sell. And those type of properties (bungalow, old peoples homes) will be bought by people who have owned for like 40 years and have tonnes of equity. Alright, you can make a case out of separations I suppose. Anyone have any stats on divorce rates? Just what is going to cause a flood of properties onto the market - only forced sellers as I see it. These would be people who bought at 0.5% base rate (last 2 years?) and wont cope with small IR increases and high general inflation. Last I saw repo rates were dropping due to low IRs. I think we were running at 10,000 in the 3 months prior to October in 2010. Maybe we will start to see these pick up again in 2011?
  8. Fellow: Well i do recognise this - "This may come about slowly through the effect of inflation effecting luxury purchases of course, but this is going to take time". Maybe I was not as explicit as I could have been. But when they bought at record prices as you put it, IRs were not at 0.5. So now all mortgages are cheaper than they ever have been for existing home owners. So they already have a big cushion. My belief is IRs will be sub 1% for quite some time. Inflation will be through the roof, but I think this is all part of the grand plan.
  9. Was just wondering what mechanism will actually cause falls in house prices. Like any market, once sellers exceed buyers I guess. Well FTB's are priced out of the picture and transactions are through the floor. So not that many buyers about. But what would actually make someone sell? The way I see it, no one is going to sell their house for less than they bought it for [neg equity], or indeed what they believe it should be worth now [uK property owner mindset]. So they would need to be forced sellers, with no alternative left, i.e - they cannot afford the mortgage any more and have to move to a cheaper place or downsize. If some one loses their job and gets another one and has to commute 3 hours a day instead of 1, they will do it. If they have another baby and it has to share a room with a sibling, they will do that. Anything but sell for less. Unemployment vs IR vs Inflation I think people can cope with inflation. They will adjust, shop in Asda and not Sainsburies any more, no foreign holiday, maybe negotiate a day working from home per week, no more take outs or eating out. You get the picture. It will hurt but people will cope. IR - I really dont see these increasing much. They have been far too low for too long so we know inflation is not the target any more, its protecting home owners that counts. And although I hate to admit it I can kind of see why. People can handle inflation but as long as they can pay the mortgage, that's all that counts to keep the whole game going. If IRs raise back anywhere near 4% or 5% that's going to hurt everyone's mortgage payment and they don't want to risk too many mortgage defaults and repo's. Anyway, they want inflation to erode the debt we have. Unemployment is the only solid mechanism I see for price falls. This may come about slowly through the effect of inflation effecting luxury purchases of course, but this is going to take time. Of course there are more public sector cuts to come. I know the last unemployment measure was 7.9% back in December 2010. Do we know what the forecasts this year for further cuts? Surely the govt know how much they can push it before it starts to effect house prices. I really don't see huge house price falls coming, just because people adapt and can survive just where they are. They will stick it out until the last. I can see a steady downward pressure on house prices though, maybe 5% a year for the next 5 years or something. That will be the return to the mean. Houses are not like stocks and shares that can be sold in an instant, they are peoples homes that people want to hold onto. Unfortunately this is the reality that I have come to understand. Us FTB's are going to be kicking around for a while yet, trying to save a huge deposit in a high inflation, low IR environment. Maybe i will be buying in 2015. thoughts please
  10. I don't know why the government don't just nationalize the housing losses on a personal basis. So starting with the 2007 peak, and then adding 10% a year to that, just to keep the dream alive. They can pay for that by introducing a rental tax. So we HPC'ers can never afford a home, and the BTL lot and property owning class can sit back and reap the rewards. After all, it was an American problem that came blowing this way. Without that, house prices would have never stopped rising!
  11. Anyone know anything more about them than has been in the general press? Apparently you have to have an appointment with them, which i don't really disagree with ti be honest. I might do it and find out what they have available for FTB's. Will I be able to get 90% at a decent rate being an FTB?
  12. What i should clarify is that I meant 'life on hold' with regards planning for a family. Life goes on renting or owning as many of you have said. Plus you can be happy renting too! Its just that lately I have been feeling in a total minority amongst my peer group, they all settled down and bought years ago. I was kind of late settling down but now I have my own little family. I was wondering if there is or is going to be some sort of social change - ppl having families later, etc. I would still like to hear the opinions of more women, as maybe they have a different outlook when it comes to having kids. Maybe we need to wait 10 years to know the answer
  13. The people who claim that renting is ok must be earning enough to pay the rent + enough to save for buying or continuing to rent after they have retired. If you are renting and are unable to save I would say your going backwards - putting off the start of paying off your house. That's gotta be 50K single salary at the very least in the South East.
  14. Funny, when I say I am renting, all i get is why don't you buy? Then I have to go down the whole house price thing, with 25% deposit, etc. Why dont you do shared equity, etc etc. I don't really believe owning your own house is that bad is it, as some people like to make out. Yes i know the banks technically own it, but your not getting chucked out if you keep up the payments right? Also, home is somewhere you can make your own, decorate it and do stuff in the garden. You know the nesting thing women do, well that's limited in rental.
  15. Well traditionally you move in with someone, then buy a house then have kids right? The situation is different now. I am sure a women has a different mindset when it comes to having children too - stability. I find a lot of renters of family homes are off working in the East or the US on short term contracts. We have been on the end of this twice now. I am not saying your life is over because you don't have a house, far from it. Just wondering about the social change - if any.
  16. uh - that's bad. Should have read because of my kids...
  17. Just out of interest, how many couples are there on here that are renting (or staying with parents) and waiting to buy a house? Does your rental situation put you off having children? In our situation we just did it anyway. I don't see why we should wait when either of use are getting any younger. But i do feel bad inside of my kids that we dont own a home. I always have a slight sense of shame when I tell people I am renting still. I know its stupid, but its just how I feel. I wonder what the social consequences of long term nation wide property investment will be?
  18. I think my overall reasons for leaving would be: 1. House prices 2. Work/life balance 3. Weather Mainly the bit that upsets me is that I cant afford a home for my family. It was ok when I was single and even living with a partner, but now its starting to grate now I have children. I have been waiting the last 4 years and people say just wait a bit longer. But i don't see much of a fall in the Berkshire area, maybe 10% or so, but i need another 20% off where they are at currently. Berkshire is skewed because of the income from London commuters. The only thing I see helping is a big rise in unemployment and forced sales. Neither of which I would wish on anyone. I dont think the UK is that bad generally. We have our bad points like everywhere else. I just want a more affordable home, thats not a rabbit hutch in a sink estate.
  19. Peter, that's pretty much the answer that I loved reading, everything that I imagined a life abroad would be! Some one with a positive experience of moving away. Anything you would suggest to some one who is interested? Job fairs, local estate agents etc.? What area do you live in, what job do you have? Maybe I should start French classes...
  20. Smog - i think you said you moved to France 4 years ago. Is the housing situation that we have in the UK mirrored around Europe? I mean can you buy a house on an average salary in France? I would not want to move out of Europe as we have 2 kids (under 2) and want to be close - ish to the relatives in the UK. The thing that appeals (this may be a romantic notion of the French lifestyle) is the work/life balance. I am pretty sick with working just to stay still, I am paying some one else's mortgage for them and I am 31yrs old. At this rate I cannot see us getting a house in the UK until my late 30's. So then that's me working until I am 65 before the mortgage is gone. Plus engineering is a 2nd class occupation here. If your not in finance or marketing your a moron Jaded - i am
  21. I live in Berkshire, which is expensive. I studied engineering at university so I am in telecomms. Most of that work (the stuff that is left) is either in Cambridge or M4 centric. So I am competing with all the London fincance lot who hop on the train to collect their 100K of tax payers monery per yr. If I move, that means longer commute = less time with family. Maybe I need to adjust my expectations. If I want a house, live in the sticks, drive for 3 hours round trip per day to work. Regarding France, silly question, but how much is the language a barrier for getting a job? I mean I did GSCE, but if you are willing to learn and do courses maybe they would have you if you have the right skills for the job?
  22. Hi everyone, I have read quite a few posts on here with people getting hacked off with the UK and are ready to leave. I sympathise with a lot of the comments and am getting fed up with the house prices in my area. The only way we could afford a tiny house (spend 65% of my income) is to live in a sink estate in a town and I don't want to bring my kids up there. So where would you go? I have not done any research myself yet, although I am aware that sometimes the grass is greener and that perhaps the UK does have things going for it. I always think of somewhere ridiculously picturesque, like the south of France. But then you need a job, right. So I bet living near a major town there is probably outlandishly expensive for the common man as well. And getting a job there is hard too due to there employment laws. Plus I only speak English. Thoughts please?
  23. Having touched a few nerves in my time on house prices in my office, i have resisted commenting on the current situation and was happy for events to unfold and for me to be proven right (that prices will come down). That was until the guy i work with bought it up the other day, he was saying that house prices were still up 'year on year'. I was trying to point to the graph on the bbc and said what do you think is gonna happen when growth hits 0%, things dont flatten out very often, they are iether going up or going down. Anyway, he kept saying that i was not right about the market, it was still going up, just more slowly. We got on to the subject of credit and we both agree that FTB's are screwed, just as your city bonus man who buys up million pound properties, due to 1000's losing their jobs. But he steadfastly maintains that the middle of the market will remain competitve, and will hold it price. This is due to the fact that most of these ppl have equity, decent jobs and there is a shortage of 2-3 bed family homes due to loads of them being converted into flats. I can kind of see where he is coming from, but surely for prices to hold steady you need a healthy market, ppl trading up and down, which is just not going to happen. No FTB will be trading up will they? These ppl will hold on to the bitter end!
  24. in my office, there are two that are pretty vocal on the subject. But you simply cant have a debate or a reasoned argument with someone who has an unbending HPI faith. Its a belief system and it cannot be shattered. One guy has one house which he bought cheap and rennovated it himself, not a bad thing to do, but he has faith that he will get more out than he has put in. The other guy ownes two houses, so to believe reality would be painful. I overheard a conversation the other day they were having about the price losses. The conclusion was that although they have come down, they are still like 9% up over the year. At that point it was like a warm feeling came over them both as if they had set things right in their heads. I was on the verge of saying yeah but thats like throwing a ball in the air and from the moment it starts coming down you trying to argue that the ball may not fall back to earth as its still x distance up in the air. I avoided this as they can get quite patronising and it creates a bad atmosphere. They were telling me last year that i should buy, as the housing shortage was going to push prices more out of reach. It got quite difficult then. In fact i ended up feeling quite stupid and it took me a few moments to affirm my own beliefs once more. The other thing that really gets me while i am at it, although i know this has been discussed on another thread, is the talking oursleves into recession and the sensational way in which losses are reported. I just cant take the double standards of these people. I mean yeah, the media will sensationalise any news, good or bad, its their job to sell papers. But you cant just complain one way or the other. My retort is usually that if there had not been sensationalism on the way up (mindless speculation, national obsession) we would not be in this mess for them to start coming down. Although views are changing slowly, i still think that the truth is hard to swallow for ppl with a lot invested.
  25. Sometimes i do feel like this HPC thing has become bit of an obsession for the members of this site. I now read the business pages on the internet daily, buy the sunday broadsheets and read the business section front to back. I am now a bit of an armchair economist in most areas! I myself find it hard to remain objective and end up reading all the bad bits and skipping over the good. But its hard to deny that sentiment is changing within the press, with the BBC and the papers actually talking about a 'correction'. But it amazes me how the people i work with and my friends, most of whom are home owners, are oblivious to any negative news on HPI. We are just about to be kicked out of our rented accomodation, the LL is coming back to the UK to live. I have had three ppl now say that the best thing i should do now is buy. When i tell them the basic sums and that about 70% of my wage will be on the mortage, they are like, yeah so what, you young ppl today want everything. Your just gonna have to rough it for a while. I tell them that including ctax, bills, food etc i will be about 95% and they say the same. Just do it, get on the ladder. So then i go on to expain that the whole house boom is coming to an end due to lack of credit and affordability and they look at me as if i am mad! I just get the whole low unemployment low interest rate rant. I have said look at the US and they are say, ah thats different they have so much land there. We have not got the land here and there is too many ppl. I say what about Japan and they say, ah thats different there economy is not growing there. So then i go on to say, look, our economy is heavily built upon house prices, our debt is close to our GDP, the world economy is slowing generally and they are falling off their chairs at this point. I honestly sometimes feel like i am office idiot who knows nothing. The conversations i have had become quite heated as they just wont have it, i am not prediciting the massive crash that some are on this site, all i want is for them to say, yeah this house market is cooling off, maybe you should stay renting and save up a big deposit. In fact, one of the guys said, look what you sould really be doing is borrowing enough to buy some land and build some flats, (i earn 35k a yr) and then make it all back when you sell it. I said who the hell is going to lend me 500K then? They reckon i can do it easy. I said no thanks and then they started saying well your never going to get anywhere if you dont take risks. I finished by saying as soon as anyone like me contemplates jumping on the bandwagon then its all too late. They think i am mad to rent. Then i get a mate of mine trying to convince me to buy with him. I go through the same thing again and say look, im no expert in economic cycles but you have to admit now is the wrong time. Again, he thinks i am mad or stupid or both. We are completely in the minority. I think its the same for them as it is us, we tend to skip over the bullish bits to get our 'bear food'. Well they are doing the same and ignoring all the market stuff at the moment. Its gonna take a while for consumer sentiment to change, all those house survey slowdowns will be just a blip before christmas. The boom has lasted for 15 yrs appox and peoples mindset is hard to change. They only see what they wanna see. Has anyone else experienced this?
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