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Big_Al

No Theories, Just Actuality

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I've mainly been lurking on this site since the tail end of last year when I decided to take a new job which involved relocation.

I have found this forum at times interesting and thought provoking and at other times I have found some of the comments both childish and ignorant!

Anyway, i thought I'd share my actual experience and decisions made in the hope of generating some interesting comments.

First off, as we were looking to buy a more expensive property, I was hoping for a house price crash/reduction. I know my eventual equity would have been lower but if prices reduceed across the board then my next mortgage would have been correspondingly lower.

The relocation involved selling the house and I had the usual 3 EAs around for valuations:

1. £300k

2. £280k

3. £265k

The house went on the market mid Oct for £280k. We had a total of 27 viewings which average 3 a month (seems low to me!). Price reduced £265k (eventually) and we have finally sold at £250k.

During this time we were looking around for a new house to buy. There didn't seem to be that many nice ones in the location we were looking at and the ones staying on the market were either not appropriate (for us anyway) or overpriced (and not reducing).

We eventually found a nice place which was originally priced at £390k and had been reduced to £365k by the time we viewed it. We put in an offer for £340k which was rejected. Agent told us they were looking for £365k ish!

We couldn't sell our place at the time so we lost it. I found out that it eventually sold for £347,500.

Since selling our place, much to my surprise we have decided to rent. We've found a place that was on the market for sale or rent (couple emigrating and were looking at both options). Sale price £500k (overpriced I think), rent negotiated down to £1400pm.

The rent's still steep but we'll stretch ourselves and use income from equity on house sale to cover some of the rent.

There's no way I could have obtained a mortgage for a £500k house let alone make the repayments. In fact they would have been £2400pm.

So, we've ended up renting a place worth £500k paying a bit more than if we had bought somewhere for £350k (interest payments £1100pm month). Sounds like a good deal to me.

We will buy eventually but the current situation gives us time to get a feel for the local area without committing us to buying - stamp duty is a real bummer once you go over £250k!!

I know there is a risk that property prices will go up and we'll have "missed the boat" but like others on this forum I have my own opinion and think prices will reduce over the next few years.

Only time will tell who is right, however, on a final note, I seem to recall many fund managers back in the mid to late nineties saying that the US stockmarket market was overpriced. It took the dot.com bubble to burst and 9/11 to bring this prediction to fruition but they were right in the end. I wonder if something similar will be true of HPCers predictions and the current UK housing market??

Cheers

Big Al

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Apologies, but did I read it right? You are using some of the equity from your house sale to subsidise renting a house that by your own figures is way out of your range? Why do you give a shit that you are living in a house worth 500k when you are using some of your savings?

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The house went on the market mid Oct for £280k. We had a total of 27 viewings which average 3 a month (seems low to me!). Price reduced £265k (eventually) and we have finally sold at £250k. [big_Al]

This appears to be a good illustration of Stamp Duty Threshold Chasm Effect:

http://www.housepricecrash.co.uk/forum/ind...showtopic=13099

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Apologies, but did I read it right? You are using some of the equity from your house sale to subsidise renting a house that by your own figures is way out of your range? Why do you give a shit that you are living in a house worth 500k when you are using some of your savings?

No, not using the equity but the interest that it generates. Ignoring today's rate drop I can get about 5% gross. Putting it in my wife's name (non earner) means that most of this is tax free. We've a fair amount of equity so the interest generated is quite high.

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The house went on the market mid Oct for £280k. We had a total of 27 viewings which average 3 a month (seems low to me!). Price reduced £265k (eventually) and we have finally sold at £250k. [big_Al]

This appears to be a good illustration of Stamp Duty Threshold Chasm Effect:

http://www.housepricecrash.co.uk/forum/ind...showtopic=13099

Good article. When we originally put the property on the market I thought that the £250k threshold would give us problems so always had in my mind to accept offers at £250k.

Although demand in my area has been slow I think this has been a factor in low amount of viewings.

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  • 338 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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