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andrew_uk

House I Want Has Fallen 20k So Bought A Sports Car

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Since so many people spend there equity (e.g. money they haven't actually got unless they sell up)

I've done the opposite and spent the money the house i'm planning to buy has fallen by.

My logic is simple:

Have a house worth 100K, it goes up to 120K. So release this equity with a loan for the 20K. This is the 'my house is a piggy bank' mentality that's so common.

I did the opposite:

House I wanted to buy (Area + size) were going for around 160K Sept last year. Now when i look I can buy one for 140K ignoring any money I can negotiate off.

So I made 20K and spent it on a high performance sports car (no not a Audi TT more performance and negotiated a fantastic price)

I STR last Sept so bought it cash, even if a recession/depression comes (I think it probably will) I don't really care as the car is so much fun and life is for living.

I just thought it might be interesting to show that, at least in my area, I've seen prices falling and used it to my advantage. I also like the reverse MEWing aspect of it.

I must admit it is a bit cheeky when I explain the logic to people at work who own houses. Especially when i add that it only costs me money I own not a bigger debt that later I might not be able to afford.

The way things are going around me (I check the property pages in the smoke room at work). I expect to buy the house I want for 100K in around 2 years time. Through due to demographics (people buy here as the local cities are too expensive) and the massive amount of new builds (I'd guess at 20% increase in total housing in the last 3 years - additional 10K above current 50K in area) it could potentially fall much further.

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Since so many people spend there equity (e.g. money they haven't actually got unless they sell up)

I've done the opposite and spent the money the house i'm planning to buy has fallen by.

My logic is simple:

Have a house worth 100K, it goes up to 120K. So release this equity with a loan for the 20K. This is the 'my house is a piggy bank' mentality that's so common.

I did the opposite:

House I wanted to buy (Area + size) were going for around 160K Sept last year. Now when i look I can buy one for 140K ignoring any money I can negotiate off.

So I made 20K and spent it on a high performance sports car (no not a Audi TT more performance and negotiated a fantastic price)

I STR last Sept so bought it cash, even if a recession/depression comes (I think it probably will) I don't really care as the car is so much fun and life is for living.

I just thought it might be interesting to show that, at least in my area, I've seen prices falling and used it to my advantage. I also like the reverse MEWing aspect of it.

I must admit it is a bit cheeky when I explain the logic to people at work who own houses. Especially when i add that it only costs me money I own not a bigger debt that later I might not be able to afford.

The way things are going around me (I check the property pages in the smoke room at work). I expect to buy the house I want for 100K in around 2 years time. Through due to demographics (people buy here as the local cities are too expensive) and the massive amount of new builds (I'd guess at 20% increase in total housing in the last 3 years - additional 10K above current 50K in area) it could potentially fall much further.

Good for you, its your money, spend it how you like. Your logic is infinately more logical than the "my house has gone up in value, I must borrow more quick!"

I think TTRTR will jump onto this and say its an example of STR's wasting their cash, but he seems to think that if you don't buy property you will sort of wither away to nothing, and dissapear into the cosmos like a piece of space debris.

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andy uk,

PLEASE put that on singing pig! (without the justification)

It's just a masterstroke in unmasking the thinking behind spending your unrealised home equity on consumables.

The difference is of course, you are wholly aware of the financial transaction you are making.

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I must admit it is a bit cheeky when I explain the logic to people at work who own houses. Especially when i add that it only costs me money I own not a bigger debt that later I might not be able to afford.

Thats the best bit, fantastic would love to see you explain that to your work mates--what did they say????

I have got to admit a car is the last thing i would have got, but we all love different toys. I would have got a push bike (and kept the rest as I am a tight git)

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Thats the best bit, fantastic would love to see you explain that to your work mates--what did they say????

I have got to admit a car is the last thing i would have got, but we all love different toys. I would have got a push bike (and kept the rest as I am a tight git)

Ian, did you write posh bike, and did the nazi's change the spelling to push bike?

I can't believe you would do the opposite of MEW and not at least buy a posh bike.

By the way what is the opposite of MEW?

SMW - spend my winnings? (that ones for Bruno)

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I must admit it is a bit cheeky when I explain the logic

logic?

the first problem is that the (assume) 20k you just have spent will be shortfall on the house you buy. So you'll have to borrow that 20k again later on... assuming a typical mortgage of 25 years that car has just cost you 40k

how manyhours of work would it take to bring about 40k of savings? and how many hours of driving pleasure would you get in return

sorry... don't want to spoil your commute but buying a sports car without owning a house is a mug's game...

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I agree.(Unless you are 45,bald and think this will make you attractive to the opposite sex)

Nah 31, full head of hair and i'm already attractive. I bought the car as I love to drive not as a pussy magnet, I'll admit the ego stroking I got from others was not expected but like anyone else I found myself enjoying it.

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Yes, I have the same logic. I get toilet paper from the ATM around the corner! It feels so good wipping my ass with the queens head!

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I have gotten into gambling. Not seriously though. Just £100 quid here and there. I bet £100 that the first test match would be a draw :(

But then I bet that England would win the next test match at 5-1 :lol:

Outstanding bet - Series Draw at 9-1 (I would still rather that England won though)

(Just like people think house prices always go up I figured people had got it into their heads that Australia would always beat England- they still might but those odds had England oversold).

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I would have got a push bike (and kept the rest as I am a tight git)

Same here... in fact I just spent just under a grand on a new push bike and associated bits and bobs :D

Some people may say thats a lot to spend... well I treated myself... after doing the sums B)

By spending a couple of hours a day cycling out and about.. and the only cost of a ride is for a pint in a country pub in the middle of nowhere.. it's actually saving me money and pays for itself after about a year B)

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Guest Charlie The Tramp
the first problem is that the (assume) 20k you just have spent will be shortfall on the house you buy. So you'll have to borrow that 20k again later on... assuming a typical mortgage of 25 years that car has just cost you 40k

When the time comes to buy and IRs are higher could be more like 50k.

Best a smaller mortgage or going for early redemption anytime running an old banger. <_<

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logic?

the first problem is that the (assume) 20k you just have spent will be shortfall on the house you buy. So you'll have to borrow that 20k again later on... assuming a typical mortgage of 25 years that car has just cost you 40k

how manyhours of work would it take to bring about 40k of savings? and how many hours  of driving pleasure would you get in return

sorry... don't want to spoil your commute but buying a sports car without owning a house is a mug's game...

Hmm. When I was young I told others that I would rather buy a Ferrari and live in laybys than buy a house.

Of course, house it is, no Ferrari, but a fast car is in the garage.

You have to feel the blood in your veins sometimes.

That means different strokes for different folks.

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Hmmm, I don't think this logic will go down too well when I tell the wife I've bought a Gibson 335 because I saw a suitable house fall £1,500.

Ahh, a guitarist. I recently bought a Musicman Stingray Fretless on eBay. I love it. I can't really justify what I spent on it, but there is more to life than looking at your bank balance. Money is there to be spent, just keep a little in reserve.

BTW, all you chaps creaming your pants over driving a car quickly, I really don't understand. If you want real exhilaration get a motorcycle, now that's real speed. My number one toy, my GSXR750, will kill any Porsche dead. Great fun on track days too.

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When the time comes to buy and IRs are higher could be more like 50k.

Best a smaller mortgage or going for early redemption anytime running an old banger.  <_<

I see where you are coming from but I admire the guy, I really do.

I have wanted to buy an MX-5 for about 2 years now but am just plain chicken sh!t.

I am too scared about future job prospects - software :(

I am too scared about petrol prices. I think we on the edge of one very, very rude awakening indeed.

Just too damned scared about just about everything. I wish I had a crystal ball.

I say again, I admire the guy.

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logic?

the first problem is that the (assume) 20k you just have spent will be shortfall on the house you buy. So you'll have to borrow that 20k again later on... assuming a typical mortgage of 25 years that car has just cost you 40k

how manyhours of work would it take to bring about 40k of savings? and how many hours  of driving pleasure would you get in return

sorry... don't want to spoil your commute but buying a sports car without owning a house is a mug's game...

Actually I expect the shortfall to be much more than 20K when i eventuly buy.

I could've bought a house last Sept on a normal mortgage (3.5x salary) using quite a bit of my deposit. Since then the price has fallen and since i'd stick to 3.5x at max my deposit required has fallen by 20K, so i spent it.

Buying and trading up of houses is an important part of pension planning over the long term (age 25-60) but not in the current short term climate. I'm just timing my entry into the market. Shares go up 7% on average a year but pick the wrong point to dive in and after 5 years you'll have lost 40% of your cash.

As for some logic behind my purchase:

If I bought a new car for 14K it'll lose on average 50% of it's value after 3 years e.g. 7K. I compared my car (including my v. good deal) to those of the same model 3 years older and the price difference was 3K. Even comparing 3 years warrenty to 1 years it's still cheaper than a new car. Even factoring in £400/yr extra in insurance and £500/year in fun juice (petrol).

I could of course buy a cheap run around instead but I've done that for the last 5 years in order to save some cash. The sales staff actually laughed at my trade in.

As for the hours I'll spent to earn 20K, the car is worth it. I love it. Just need to sort out a track day.

I do agree that owning a sport car without owning a house is a mugs game in a normal part of the housing cycle but at the moment housing is devaluing faster than a sports car.

Edited by andrew_uk

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Ahh, a guitarist. I recently bought a Musicman Stingray Fretless on eBay. I love it. I can't really justify what I spent on it, but there is more to life than looking at your bank balance. Money is there to be spent, just keep a little in reserve.

BTW, all you chaps creaming your pants over driving a car quickly, I really don't understand. If you want real exhilaration get a motorcycle, now that's real speed. My number one toy, my GSXR750, will kill any Porsche dead. Great fun on track days too.

Boys eh, guitars and speed machines!

Yes, you're right 'bikes are it.

Me, I keep thinking about a 'bike again before I'm too old.

Btw, iirc, aren't you in medicine. I thought many in that field had a dim view of motorcycling. "Donorbikes" and all that.

:)

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Actually I expect the shortfall to be much more than 20K when i eventuly buy.

I could've bought a house last Sept on a normal mortgage (3.5x salary) using quite a bit of my deposit. Since then the price has fallen and since i'd stick to 3.5x at max my deposit required has fallen by 20K, so i spent it.

Buying and trading up of houses is an important part of pension planning over the long term (age 25-60) but not in the current short term climate. I'm just timing my entry into the market. Shares go up 7% on average a year but pick the wrong point to dive in and after 5 years you'll have lost 40% of your cash.

As for some logic behind my purchase:

If I bought a new car for 14K it'll lose on average 50% of it's value after 3 years e.g. 7K. I compared my car (including my v. good deal) to those of the same model 3 years older and the price difference was 3K. Even comparing 3 years warrenty to 1 years it's still cheaper than a new car. Even factoring in £400/yr extra in insurance and £500/year in fun juice (petrol).

I could of course buy a cheap run around instead but I've done that for the last 5 years in order to save some cash. The sales staff actually laughed at my trade in.

I considered being a hoarder (I'm naturally careful with money) I could easilly invest and save, invest and save and at age 40 own a nice house without a mortgage but life is for living. It's too easy when you get a big lump sum to fixate on growing it. But it ain't healthy.

On a side note so you don't think me a fool with money:

Before this I kept a cheap and cheerful run about for 5 years after my previous car was stolen and insurance rocketed.

It's 4 years old and convertible so depreciation over 3 years will be less than buying a new car

As for the hours I'll spent to earn 20K, the car is worth it. I love it. Just need to sort out a track day.

I do agree that owning a sport car without owning a house is a mugs game in a normal part of the housing cycle but at the moment housing is devaluing faster than a sports car.

Enjoy your car mate. And the summer.

You said twice now, you love the car. That's what matters.

Good on ya!

Track day! Jesus, what did you buy?

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I agree about watching your bank balance grow and how unhealthy it is.

I have a mate who has paid off his mortgage, and has over 100k in the bank. His wife earns a lot of money.

He has been off work with a bad back and had to decide whether to go back to work, a job that he detests!

He said he just wants to get to having 300k in the bank as he thinks that will be "enough".

We have spoken about this a lot and he admits, that as he has more money, he just keeps upping the amount he wants, even though he can't tell me why 300k is the magic (current) figure.

He is really stressed out about going back to work. I have told him to do something he wants to do.

He agrees but admits he can't stop thinking about how much he will need in the future.

Its odd, because 10 years ago, he used to drive a white van and had absolutely nothing! Has had a very good 10 years!

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Boys eh, guitars and speed machines!

Yes, you're right 'bikes are it.

Me, I keep thinking about a 'bike again before I'm too old.

Btw, iirc, aren't you in medicine. I thought many in that field had a dim view of motorcycling. "Donorbikes" and all that.

:)

hmm interesting. Most of the surgeons I know (they keep me as companny to show they can still slum it) drink outrageous amounts, so one can only assume that they do have something of a blind spot regarding their own health

re: guitars, I still use my very first one which cost £140 in 1989. Still does the business... like anything else, it's not what it is but what you do with it.

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Ahh, a guitarist. I recently bought a Musicman Stingray Fretless on eBay. I love it. I can't really justify what I spent on it, but there is more to life than looking at your bank balance. Money is there to be spent, just keep a little in reserve.

BTW, all you chaps creaming your pants over driving a car quickly, I really don't understand. If you want real exhilaration get a motorcycle, now that's real speed. My number one toy, my GSXR750, will kill any Porsche dead. Great fun on track days too.

GSXR 750 More likely to kill YOU dead !! Nearly did me, and did one of my friends.

Fun while it lasted though !!

Stick to off road bikes these days, and four wheels on the road.

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Boys eh, guitars and speed machines!

Btw, iirc, aren't you in medicine. I thought many in that field had a dim view of motorcycling. "Donorbikes" and all that.

:)

Yes, I am and I love my job, but I'm still a human being. If you met me you wouldn't believe I was a Doctor. ;)

Bikes are amazing. Just booked my next track day at Croft, 16th Sept, can't wait. BTW, if I don't post after 16th Sept then it's cos I've carked it. :(

Nearly had 2 100mph offs the last TD I did. :blink::(

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  • 301 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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