How Much Money Has Hpc Saved You?

[Mikhail Liebenstein]

This is like saying my neighbour blew 500K gambling. So now my social standing has improved 500K relative to him. What kind of world do you live in?

Well yes indeed it is, but the point with property that far too many were at it. Too many people telling us about their portfolios, how it was their pension, how they could retire because their property was busy making them money. And then laughing at those who couldn't afford a house.

This didn't affect me directly as I was lucky enough to have a well paying job and had my own house back in 2000.

But I knew it was wrong and unjust. And now I am taking the chance to gloat over those speculators. Perhaps like the bankers they thought they had special and unique talent and deserved their riches.

Well guess what - it turns out property investment is for suckers!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

The really funny bit is that all that happens with speculation is a transfer of wealth. For most normal people who just have a house as a home don't lose out as usually they are in their home for sometime and when they trade up or down the ups and downs don't matter too much as what matters is the relative cost.

So where has my gain, and the gain of the other STRers come from? Its come from the pockets of property speculators, the buy to lose set.

[Mikhail Liebenstein]

Where I live, asking prices are at or close to 2007 level according to rightmove.

Anyone who whould have STR in 2007 in my area, would just about breakeven today (or lose money) when stamp duty, solicitor fees, moving fees, and renting costs are taken into accounts.

Not sure STR is the gravy train most posters are trying to portray here...

I suggest you look at asking prices versus sale prices. You'll get a nasty shock.

STR is the biggest gravy train there's been throughout the credit crunch, other than perhaps gold.

[Tricksy]

When many miss your point it's usually a sign that you're wrong, or at best haven't made your point very well.....! In this case I suspect the latter. Your original post obscures an assumption that the present value of the interest on £200k over term would amount to £200k. Not sure about that.

Edited September 20, 2009 by Tricksy

[christhpc]

To be fair, if HPC.co.uk hadn't existed I'd have hit on Motley Fool Property Markets and Trends forum. If that wasn't around? I'd have talked to my mates that were of a similar mindset (FTBers / 2TBers) on housing and found reassurance there instead.

And if all else failed? I wouldn't have bought anything anyway as I'm a fookin' tightwad. And despite being a bit young during the last housing bubble - this housing bubble has been the most obvious thing - it never ceases to amaze me about peoples' denial over the very fundamentals of economics - what goes up must come down. Debt must be repaid. End of.

[cockrobin]

I sold Feb 2007, making a profit of about 45k. On the advise of a few HPCers decided to rent, and have been now for just over 2 years. Having saved another 10k(ish) I have just bought a 4 bed detached having an offer of 10% under asking price accept, the property had already dropped about 20% from peak so done alright I reckon. My mortgage payments will work out to be about the same as what I am paying in rent now so I'm quite pleased about that.

I know property will fall more in the long term but I just couldn't wait any more, I hate renting!

[Mikhail Liebenstein]

When many miss your point it's usually a sign that you're wrong, or at best haven't made your point very well.....! In this case I suspect the latter. Your original post obscures assumption that the present value of the interest on £200k over term would amount to £200k. Not sure about that.

Actually you are wrong and as wrong as can be.

If I had to borrow £200k extra, then when paying it off it is fair to say that £200k is the last £200k that would be paid off and so would be accruing interest for most of the mortgage, lets says its takes 15 years before the balance gets down to £200k, then I have been paying interest on £200k for 15 years, at what, 5%. Well guess what, that £200k, actually becomes £415k over 15 years.

[LowestoftBoy]

Around August 08, there was a lot of talk on here that interest rates would probably rise. At that time I was on Nationwide's SVR. I saw they had an offer of fixing at 5.98% for 3 years with no fee. I took it.

In the following months, interest rates and Nationwide's SVR plummeted.

Last time I looked, my clever financial decision was costing me around £40 a month.

I chuckle to myself about it.

[Tricksy]

Actually you are wrong and as wrong as can be.

If I had to borrow £200k extra, then when paying it off it is fair to say that £200k is the last £200k that would be paid off and so would be accruing interest for most of the mortgage, lets says its takes 15 years before the balance gets down to £200k, then I have been paying interest on £200k for 15 years, at what, 5%. Well guess what, that £200k, actually becomes £415k over 15 years.

So you've really saved £350k + £415k = £765k then?

Keep digging!

You're not separating properly the capital outlays, the costs of financing and the opportunity costs. You've sort of got all three mixed in together. Never mind.....

[Guest P-Diddly]

Around August 08, there was a lot of talk on here that interest rates would probably rise. At that time I was on Nationwide's SVR. I saw they had an offer of fixing at 5.98% for 3 years with no fee. I took it.

In the following months, interest rates and Nationwide's SVR plummeted.

Last time I looked, my clever financial decision was costing me around £40 a month.

I chuckle to myself about it.

That's about a fiver more than my basic household running costs including unlimited mobile internet which accounts for 50% of that.

[christhpc]

Around August 08, there was a lot of talk on here that interest rates would probably rise. At that time I was on Nationwide's SVR. I saw they had an offer of fixing at 5.98% for 3 years with no fee. I took it.

In the following months, interest rates and Nationwide's SVR plummeted.

Last time I looked, my clever financial decision was costing me around £40 a month.

I chuckle to myself about it.

Yeah there's been plenty of dud info on HPC over the years but hey par for the course tbh. Pretty much anyone getting into Silver / gold juniors tipped on the forum before the economic crash has probably taken a haircut. That said those that bought the real / paper stuff are laughing. For now.

[BrickandMortar]

I suggest you look at asking prices versus sale prices. You'll get a nasty shock.

STR is the biggest gravy train there's been throughout the credit crunch, other than perhaps gold.

Just checked a few postcodes (in Berkshire) using mypropertyspy.com

Good properties are selling around 8-10% cheaper than 2007.

I am pretty sure this saving is largely offset by the stamp duty, solicitors fees, and rental costs etc....

So my point stands. STR is quite a risky strategy in some areas.

Edited September 20, 2009 by BrickandMortar

[Sour Mash]

Remember that if you are taking on a mortgage then any money saved on the purchase price is more than doubled when calculating saved repayments over the lifetime of the mortgage.

Because I read HPC and didn't buy in early/mid 2007 I'd estimate that I've saved over 80k on the purchase price of the sort of property I'm interested in so far, therefore in excess of 160k in terms of saved mortgage repayments.

Unless of course prices shoot back up before I buy ....

[Guest P-Diddly]

Oh, in answer to Mikey's question . . . about £9.99. Piece of Paper and Rolf saved me from buying a Remote Desktop software thing yesterday.

I've just been banned from an expat forum!!!! Celebrations!!!

Edited September 20, 2009 by P-Diddly

[LowestoftBoy]

That's about a fiver more than my basic household running costs including unlimited mobile internet which accounts for 50% of that.

That's quite impressive.

Do you grow your own?

[Guest P-Diddly]

That's quite impressive.

Do you grow your own?

Yes. Although the cost there is for electric, gas, sewerage, water, internet, no council tax here.

Rice is free. Must get on and plant more veg. The quality in the market here is not good.

Grocery is now about £120 a month. Bulk buy everything, costs down about 30%.

[Guest Daddy Bear]

I reckon thanks to HPC.co.uk I am immediately £300k better off relative to your average reluctant land lord.

My rationale is that in selling at the top of the market I avoided losing £100-150k.

Secondly, when I buy relatively soon, the type of house I want is now at least £200k cheaper.

So by exiting the property market, I am £300-£350k better off than someone who let to move.

However,in the long term the gains are even more, as I avoid paying 25 years interest on the top £200k.

So perhaps relative your property obssessed let to buyer, I am now £550k better off.

Thanks to HPI (97-07) and then HPC (07-08) and then another bout of HPI which started in Feb 2009...........

about £500,000 or therabouts

timimg gentlemen...timimg....

DB

[Mikhail Liebenstein]

So you've really saved £350k + £415k = £765k then?

Keep digging!

You're not separating properly the capital outlays, the costs of financing and the opportunity costs. You've sort of got all three mixed in together. Never mind.....

I do understand the difference which was why I painted 3 scenarios. Point is that my net worth has increased relative to that of your typical property speculator.

[jackalope]

I reckon thanks to HPC.co.uk I am immediately £300k better off relative to your average reluctant land lord.

You're assuming that, if you hadn't found HPC, then you (or anyone else be it 'sheeple' or investors) would have sold and bought at exactly the worst times.

If your Enron career doesn't pan out for you I'm sure Darling has an opening for someone with your level of analytical skillz at the Treasury.

[Guest P-Diddly]

Thanks to HPI (97-07) and then HPC (07-08) and then another bout of HPI which started in Feb 2009...........

about £500,000 or therabouts

timimg gentlemen...timimg....

DB

Just shows how mental it all was. £500,000 just a few years before would have been the financing of a moderately sized firm.

Pound = Bog paper.

[Mikhail Liebenstein]

Just shows how mental it all was. £500,000 just a few years before would have been the financing of a moderately sized firm.

Pound = Bog paper.

P-Diddly formerly known as Mr Parry, indeed you are correct.

When the Pound eventually reaches parity with Baht, then you'll be able to come back and buy most of the homeland.

[papag]

I sold my home for 285K now worth 200k tops also I got out of shares saved around 5K on todays value ,not all good news though got a L & G bond thats lost around 7K also losing on interest rates secured 2 years ago at nearly 7% lucky to get 3 now.

[Guest happy?]

Remember that if you are taking on a mortgage then any money saved on the purchase price is more than doubled when calculating saved repayments over the lifetime of the mortgage.

Because I read HPC and didn't buy in early/mid 2007 I'd estimate that I've saved over 80k on the purchase price of the sort of property I'm interested in so far, therefore in excess of 160k in terms of saved mortgage repayments.

Unless of course prices shoot back up before I buy ....

You'd need an average rate of about 6.4% over the life of a 25 year mortgage for interest charges to equal capital repayments.

[Mikhail Liebenstein]

You're assuming that, if you hadn't found HPC, then you (or anyone else be it 'sheeple' or investors) would have sold and bought at exactly the worst times.

If your Enron career doesn't pan out for you I'm sure Darling has an opening for someone with your level of analytical skillz at the Treasury.

Why are the bulls so bitter?

I'm having fun enjoying the crash. Must be the bestest crash ever!!!!!!!!!!!

[Grime- skint wouldbe ftb]

I reckon thanks to HPC.co.uk I am immediately £300k better off relative to your average reluctant land lord.

[Mikhail Liebenstein]

Yes, perfect. That's exactly the annoying image I have wanted to burn into the bull's minds. Except that it was achieved by houses falling rather than rising. The more people that do this, the less chance there will be of future HPI.

So all you bulls, "shut your mouth and look at my wad!"