Ftb - Good Location - What Do I Do?

[richardfoster]

Hi,

I have been studying this forum, web site and linked articles thoroughly. I am a first time buyer, I put a deposit down on a one bed apartment (off plan) in Market Harborough, Leics, Midlands seven months ago. The cost £116k and I am due to exchange contracts in the next month, due to be built by November. Generally people say when buying from plan you always gain something.

I have taken into account everything people say and the graphs / information on www.firsttimebuyer.co.uk and it is cause for my concern, judging also historical bubble graphs.

The fact is Market Harborough is a good location (http://www.bigfern.btinternet.co.uk/harborough.htm), it is a very desirable market town, under constant redevelopment and generally more expensive than all surrounding towns. It is 1 hour from London on the train, so commuters have pushed up prices.

Some people in this forum say house prices could go fall 50%, whereas the large news organisations and media seem a lot less pessimistic. I would hate to pull out of my dream, to find UK house prices fall 10% and MH prices don't fall at all because of the location.

I was going to risk it, based on the fact I shouldn't lose to much (buying from plan, plus location), but forums and sites such as this have thrown everything up in the air. Is there a chance that prices will level out, or do I just pull out and rent?

Thanks for your help...

Richard

[libitina]

I suppose it depends on whether you bought it to make a profit or to live in for several years to come.

Would you prefer to lose your deposit or perhaps upto 50% of the price you paid?

If you're not sure, keep researching, until you feel comfortable with your decision. There are plenty of intelligent people on here (not me by a long shot), listen to their views, but don't let them talk you into anything.

Edit: That goes for friends and family too.

Edited August 21, 2005 by libitina

[Once in a lifetime]

I was going to risk it, based on the fact I shouldn't lose to much (buying from plan, plus location), but forums and sites such as this have thrown everything up in the air.  Is there a chance that prices will level out, or do I just pull out and rent?

Thanks for your help...

Richard

<{POST_SNAPBACK}>

As long as you can afford the mortgage at possibility 8%+ and you intend to live

There for some time. (and like the area!)

good luck.

Edited August 21, 2005 by burnt before

[leefam83]

"Generally people say when buying from plan you always gain something."

ONLY in a Bull market.

The reality is... a new flat is like a car, as soon as you drive it out of the showroom, it loses value.  New Flats lose value too.

Here's why:

+ The best price will be achieved when everything is in perfect new order, any wear and tear will reduce the value,

+ Do you really think, as a seller in 1-2 years, that you can compete with a showflat, brochures, and full time sales people?

<{POST_SNAPBACK}>

Hey Doc,

on another thread you gave a bit of advice for beginners buying gold shares. Merryl Lynch fund ? Could you advise please ?

[halebop]

i posted a similar question about buying last week

and have since pulled out of buying a house at the moment

im going to save as much as i can then buy with a smaller mortgage

in a year or two?

the fact that your asking on this forum shows you already have doubts

as to waether your doing the right thing

i ask you this would you kick yourself if prices came down in this time

given that you could have saved more money hence having a smaller mortgage?

[Portent]

Hi,

I have been studying this forum, web site and linked articles thoroughly.  I am a first time buyer, I put a deposit down on a one bed apartment (off plan) in Market Harborough, Leics, Midlands seven months ago.  The cost £116k and I am due to exchange contracts in the next month, due to be built by November.  Generally people say when buying from plan you always gain something.

I have taken into account everything people say and the graphs / information on www.firsttimebuyer.co.uk and it is cause for my concern, judging also historical bubble graphs.

The fact is Market Harborough is a good location (http://www.bigfern.btinternet.co.uk/harborough.htm), it is a very desirable market town, under constant redevelopment and generally more expensive than all surrounding towns.  It is 1 hour from London on the train, so commuters have pushed up prices.

Some people in this forum say house prices could go fall 50%, whereas the large news organisations and media seem a lot less pessimistic.  I would hate to pull out of my dream, to find UK house prices fall 10% and MH prices don't fall at all because of the location.

I was going to risk it, based on the fact I shouldn't lose to much (buying from plan, plus location), but forums and sites such as this have thrown everything up in the air.  Is there a chance that prices will level out, or do I just pull out and rent?

Thanks for your help...

Richard

<{POST_SNAPBACK}>

Ultimately only you can decide whether the risk is worth it or not. I don't know the area so can't comment on whether or to what extent it may be affected by falls. Perhaps you could ask friends or relatives what happened in the ares in the early 90's?

However, as a general piece of advice, if significant falls do occur:

1) New builds will be one of the sectors worst hit for reasons Dr Bubb has already outlined.

2) One bed flats will probably be hit hard too. The problem with a one bed is that if prices doo fall then potential FTB's will look to buy 2 bed flats instead because they are "only a little bit more".

3) What if your circumstances change and you meet a partner - is there room in a on bed for two of you. What if you decide to have kids? WOuld you be in negative equity and if so how could you move to a larger property?

4) One beds are generally less desirable to BTL buyers and so your future market will be less than that of a two bed.

Based on that I'd suggest that a new build one bed off plan is possibly the worst thing to own if large falls occur. So it depends on whether you feel there are going to be continued and sustained falls in your area?

[MrB]

I put a deposit down on a one bed apartment (off plan) in Market Harborough

<{POST_SNAPBACK}>

How much deposit did you put down and would you lose it?

I'd expect to see falls over the next 12 months of between 0 and 1% per month, punctuated with a few rises.

Don't expect falls of 50% in a year.

You need to work out the opportunity cost of buying. Could you save significantly in the meantime? Steady fallls plus rampant saving would probably be your best bet.

The fact that you're asking an internet forum suggest you aren't sure. Making the biggest purchase of your life at the top of the biggest property boom in history when you are very unsure is a bit stupid.

[Bucephalus]

The fact is Market Harborough is a good location (http://www.bigfern.btinternet.co.uk/harborough.htm), it is a very desirable market town, under constant redevelopment and generally more expensive than all surrounding towns.  It is 1 hour from London on the train, so commuters have pushed up prices.

Some people in this forum say house prices could go fall 50%, whereas the large news organisations and media seem a lot less pessimistic.  I would hate to pull out of my dream, to find UK house prices fall 10% and MH prices don't fall at all because of the location.

<{POST_SNAPBACK}>

People always think that their area is not going to be hit by any falls for some reaon specific to its own circumstances.

In some cases it really is true but in many others it's just wishful thinking. I don't kow which category MH falls into, but I would point out that many towns are one hour from London (not exactly a short commute incidently) and they are unlikeley all to be spared price falls.

Good luck in coming to a decision.

B.

[BuyingBear]

I am a first time buyer, I put a deposit down on a one bed apartment (off plan) in Market Harborough, Leics, Midlands seven months ago.  The cost £116k and I am due to exchange contracts in the next month, due to be built by November.  Generally people say when buying from plan you always gain something.

<{POST_SNAPBACK}>

I think you've picked the most inflated part of the market and the tip of the bubble, there is a huge over supply of these apartments all over the UK, loads of units are being completed and newly constructed in nearly every town, most were built for speculators off-plan than for acutal residents.

Round here they simply aren't shifting and they're throwing incentives at people, BTL'ers who have bought off-plan 18 months ago are dumping them on the market, problem is that the builder are undercutting them with yet more units.

If you like the place and you're happy to proceed I would ask yourself deep down whether you have got the best deal out of them, remember it's a buyers market and in this case the oversupply of 'luxury apartments' will be the epicenter of the crash.

Remember if you pull out there are tons of these units available, if the builder mentions anything about a shortage or limited deals you can laugh at them without fear of contradiction.

[BandWagon]

Hi,

I have been studying this forum, web site and linked articles thoroughly.  I am a first time buyer, I put a deposit down on a one bed apartment (off plan) in Market Harborough, Leics, Midlands seven months ago.  The cost £116k and I am due to exchange contracts in the next month, due to be built by November.  Generally people say when buying from plan you always gain something.

<{POST_SNAPBACK}>

Who says this? The developers? Estate Agents?

When people make predictions, look at their motives (goes for people on this site too)

Personally I think you will pay a premium for a new build, and this "new" premium will disappear as soon as you move in.

You can't count on rising prices to bail you out anymore.

Remember also the land appreciates in value, while the buildings depreciate.

So I hope it's in a very good location. Too many new builds have been sold as "luxury" because they have a posh carpet or Ikea lookalike kitchen.

I judge quality by the location, room size, storage, build quality.

Most new flats fall badly short. They won't stand the test of time.

Are you going to lose your deposit? How highlygeared are you, is it easily affordable? Could you haggle with the developer for a discount?

Maybe get a friend to call them, and try knock a discount out of them.

Would be very interesting...

Edited August 21, 2005 by BandWagon

[richardfoster]

How much deposit did you put down and would you lose it? 

I'd expect to see falls over the next 12 months of between 0 and 1% per month, punctuated with a few rises.

Don't expect falls of 50% in a year. 

You need to work out the opportunity cost of buying.  Could you save significantly in the meantime? Steady fallls plus rampant saving would probably be your best bet.

The fact that you're asking an internet forum suggest you aren't sure.  Making the biggest purchase of your life at the top of the biggest property boom in history when you are very unsure is a bit stupid.

<{POST_SNAPBACK}>

Hi, the deposit was £1k, and I should get it back. I could have £10k saved by the end of the year, and I guess banking / investing makes sense. The cost of renting may not allow me to save that much though. I'll have to get a girl and make her pay half I supppose!

How long is the fall likely to go on for in your opinion? based on historical information how long do I have to wait to buy?

Thanks for your advise, I am going to pull out tomorrow, just trying to justify it as much as possible.

[Jason]

Hi, the deposit was £1k, and I should get it back.  I could have £10k saved by the end of the year, and I guess banking / investing makes sense.  The cost of renting may not allow me to save that much though.  I'll have to get a girl and make her pay half I supppose!

How long is the fall likely to go on for in your opinion? based on historical information how long do I have to wait to buy?

Thanks for your advise, I am going to pull out tomorrow, just trying to justify it as much as possible.

<{POST_SNAPBACK}>

Let me get this straight, you are going to buy a £116k flat and have so far put down £1k? If you pull out you will get back the £1k deposit?

I thought you lost deposits??!?!?!? If not, what's the point in the deposit?

[Culpability Brown]

Good decision - buying a 1 bed is a disaster in the making - wait until you can afford a 2 bed at least.

Harborough was cheap a few years ago and is really no graet shakes even now.

The East Midlands will be hit hard £116K for a 1 bed in Harborough is well overpriced IMO. Before long this will get you a 3 bed semi in Kibworth.

[NotDavidIcke]

It is 1 hour from London on the train, so commuters have pushed up prices.

<{POST_SNAPBACK}>

1. Using the maxim trust but verify I checked this claim out on nationalrail.co.uk.

Most journeys are actually 1 hour 15 minutes and from experience that'll average out as a 2 hour door-to-door journey, i.e. a 4 hour daily commute

2. The Midlands is flouridated, you couldn't pay me to live there again.

http://www.housepricecrash.co.uk/forum/ind...39entry165339

[richardfoster]

Let me get this straight, you are going to buy a £116k flat and have so far put down £1k? If you pull out you will get back the £1k deposit?

I thought you lost deposits??!?!?!? If not, what's the point in the deposit?

<{POST_SNAPBACK}>

It was, but when I signed the document I made the estate agent put 'refundable deposit' and sign it, because at the time they hadn't agreed a final price.

[BandWagon]

It was, but when I signed the document I made the estate agent put 'refundable deposit' and sign it, because at the time they hadn't agreed a final price.

<{POST_SNAPBACK}>

So see if you can haggle 20% off.

They might just bite your arm off!

Then pull out anyway, unless they give you 30% off, in which case it might make a bit of sense...

[richardfoster]

1. Using the maxim trust but verify I checked this claim out on nationalrail.co.uk.

Most journeys are actually 1 hour 15 minutes and from experience that'll average out as a 2 hour door-to-door journey, i.e. a 4 hour daily commute 

2. The Midlands is flouridated, you couldn't pay me to live there again.

http://www.housepricecrash.co.uk/forum/ind...39entry165339

<{POST_SNAPBACK}>

It's actually 1hour 7mins since they introduced the new trains.

You could awlays dirnk mlineral water, although thewater water hrer has done nothing to me.

[BuyingBear]

You could awlays dirnk mlineral water, although thewater water hrer has done nothing to me.

<{POST_SNAPBACK}>

It made you buy the flat See if you can get a two-bedder at least.

[NotDavidIcke]

although thewater water hrer has done nothing to me.

<{POST_SNAPBACK}>

How would you know? Fluoride dumbs you down slowly so you wouldn't realise it anyway.

The information is there, makes no difference to me if you believe it or not.

The Midlands is dogpoo. I lived there for long enough... you don't realise how bad it is until you move somewhere else and think 'why did I put up with that dump for so long?'

[NotDavidIcke]

I believe he was kidding, NotDavidIcke. BTW are you sure you are not David Icke?  (If that 'not' makes sense.)

<{POST_SNAPBACK}>

LOL! Yep...was reading too quickly to spot the piss take.

Not used to fighting the New WORD Order...

'Aoccdrnig to a rscheearch at an Elingsh uinervtisy, it deosn't mttaer in waht oredr the ltteers in a wrod are, the olny iprmoetnt tihng is taht frist and lsat ltteer is at the rghit pclae. The rset can be a toatl mses and you can sitll raed it wouthit porbelm. Tihs is bcuseae we do not raed ervey lteter by it slef but the wrod as a wlohe.

Yes I'm sure I'm Not David Icke... hence the name!! 2nd time been asked that in the last couple of days....

[iamconfusedagain]

It's just that you look like him. 

<{POST_SNAPBACK}>

and you look like its past your bed time

[richardfoster]

How would you know? Fluoride dumbs you down slowly so you wouldn't realise  it anyway.

The information is there, makes no difference to me if you believe it or not.

The Midlands is dogpoo. I lived there for long enough... you don't realise how bad it is until you move somewhere else and think 'why did I put up with that dump for so long?'

<{POST_SNAPBACK}>

Thanks for that, I lived in Southern California for a year, I also spend a lot of time socialising London, there are some lovely villages and nice country side arround me and there are a lot worse, dogpoo dumps in the UK.

Would you speak to me like that if I was talking to you in a pub, problably not....

[NotDavidIcke]

Thanks for that, I lived in Southern California for a year

The U.S. water supplies are also massively fluoridated

Would you speak to me like that if I was talking to you in a pub, problably not....

This is the INTERNET you numpty and I don't kiss peoples nuts on forums or anywhere else. I don't go to pubs but if we were chatting soewehere else YES I would tell you that the Midlands is a cesspit, because it is... if you want to spend 900 quid a month + bills living there in a 1 bed new build not my problem.

Edited August 21, 2005 by NotDavidIcke

[Merryn]

The U.S. water supplies are also massively fluoridated

This is the INTERNET you numpty and I don't kiss peoples nuts on forums or anywhere else. I don't go to pubs but if we were chatting soewehere else YES I would tell you that the Midlands is a cesspit, because it is... if you want to spend 900 quid a month + bills living there in a 1 bed new build not my problem.

<{POST_SNAPBACK}>

Whoa - that's a bit OTT. The poor guy is a newbie who

came here looking for a bit of advice. Do we really want the

reputation of being a load of mad rottweilers on here?

[richardfoster]

The U.S. water supplies are also massively fluoridated

This is the INTERNET you numpty and I don't kiss peoples nuts on forums or anywhere else. I don't go to pubs but if we were chatting soewehere else YES I would tell you that the Midlands is a cesspit, because it is... if you want to spend 900 quid a month + bills living there in a 1 bed new build not my problem.

<{POST_SNAPBACK}>

Ok, you've obviously got insecurities, thanks anyway!