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Speak&Spell

Potential Buyers, What Are Your Plans Now?

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Hi All,

Here's the lowdown. Come August me and my partner will have been renting for 2 years. We both want to buy a family home, in the hopes of starting a family in about 3 to 4 years time.

I've started looking on rightmove.co.uk and I've found a bunch of places I'd love to view, but my funds are tied up for another 6 months. This has made me reluctant to view, in case I happen to fall in love with one of the properties we see. Naturally I won't let the seller know this, as it's a sure fire way of NOT getting a discounted price.

My question is, do you think January going to be a better time to buy?

Here are my pro's for waiting until January......

VAT increase to 20%

January generally isn't a time you find a lot of buyers, due to xmas spending and cold winter months. Therefore potentially less offers.

We will see whether prices go down in the next 6 months, stay the same or rise. If they do rise, I doubt they will rise my much.

We will have a better idea of interest rates.

Now here come the plus signs of looking to buy now:-

More properties on the market than ever before in the last year or so, therefore plenty of choice.

Uncertain market, so you could bag a good deal, especially with the amount of properties competing for ones cash.

Mortgage rates are better than they were a few months ago. For example 85% LTV fixed for 2 years at a rate of 4%.

Even if the market stays the same up until January, I'm concerned we won't get a decent interest rate in January, so prices may dip, but rates will rise.

My second question is, do you think we'll still see fixed 2 year deals that are available now in 6 months time? In your opinion will they be better or worse?

I just need some reassurance that waiting until January is a good thing.......

Also, please let me know your own plans, so we can get a feel of what's going on....

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Hi All,

Here's the lowdown. Come August me and my partner will have been renting for 2 years. We both want to buy a family home, in the hopes of starting a family in about 3 to 4 years time.

<snip>

Sorry, but didn't even get past the second sentence. Whats wrong with renting a family home?

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Hi All,

Here's the lowdown. Come August me and my partner will have been renting for 2 years. We both want to buy a family home, in the hopes of starting a family in about 3 to 4 years time.

I've started looking on rightmove.co.uk and I've found a bunch of places I'd love to view, but my funds are tied up for another 6 months. This has made me reluctant to view, in case I happen to fall in love with one of the properties we see. Naturally I won't let the seller know this, as it's a sure fire way of NOT getting a discounted price.

My question is, do you think January going to be a better time to buy?

Here are my pro's for waiting until January......

VAT increase to 20%

January generally isn't a time you find a lot of buyers, due to xmas spending and cold winter months. Therefore potentially less offers.

We will see whether prices go down in the next 6 months, stay the same or rise. If they do rise, I doubt they will rise my much.

We will have a better idea of interest rates.

Now here come the plus signs of looking to buy now:-

More properties on the market than ever before in the last year or so, therefore plenty of choice.

Uncertain market, so you could bag a good deal, especially with the amount of properties competing for ones cash.

Mortgage rates are better than they were a few months ago. For example 85% LTV fixed for 2 years at a rate of 4%.

Even if the market stays the same up until January, I'm concerned we won't get a decent interest rate in January, so prices may dip, but rates will rise.

My second question is, do you think we'll still see fixed 2 year deals that are available now in 6 months time? In your opinion will they be better or worse?

I just need some reassurance that waiting until January is a good thing.......

Also, please let me know your own plans, so we can get a feel of what's going on....

Depending on who you get your mortgage with, they normally offer them for 6 months from the date of issue, so you could potentially wait untill August and then get one?

If I was a betting man, I would suggest they would be better in the next few months, but this is dependant on the base rate

So if the base rate stays the same, then I think you'll see an improvement by the end of the year.

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Hi All,

Here's the lowdown. Come August me and my partner will have been renting for 2 years. We both want to buy a family home, in the hopes of starting a family in about 3 to 4 years time.

I

My question is, do you think January going to be a better time to buy?

Also, please let me know your own plans, so we can get a feel of what's going on....

I am starting to look now with a view to buying late this year or early next (provided we don't go into a massive freefall and then I will ride it for as long as seems prudent). My situation is that I sold 20% short of the top in California* (still doubled my money) and have been renting ever since (late 2003). My wife and me (not I) are renting a house we would buy at the right price. We have made about 20% on the exchange rate if we swap our $ to pounds today, and locally houses are off 20% from peak. I think they will go down locally another 20% at least and possibly by about 10% before winter sets in. If this is the case I will offer on our rental at around £210 (peak was around 270-80) and start posting less on HPC.

But it depends where you are. I live in a suburb of Brighton and prices are a little more stable here due to a lot of retired folks.

But I would not buy until all the press have gone negative. We need just a few more months of drops to lower seller expectations and then go for it when morale has sunk enough that low offers are accepted. That is my plan.

Mine will be a cash purchase so IR are NOt a factor. In fact, higher IR will be a plus.

_________________

Bought in 1998 for $289k and sold in 2003 for $520k. It is now worth around $375k so still above 1998 levels.

Edited by Realistbear

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Depending on who you get your mortgage with, they normally offer them for 6 months from the date of issue, so you could potentially wait untill August and then get one?

If I was a betting man, I would suggest they would be better in the next few months, but this is dependant on the base rate

So if the base rate stays the same, then I think you'll see an improvement by the end of the year.

Thanks Bam for a useful reply. Definitely worth looking in to.

To everyone else, just my choice that I don't want to raise kids in rented accomodation. There's absolutely nothing wrong with renting a family home, but in my experience I don't want the uncertainty of being thrown out because the landlord wants to sell. We've also had landlords not bother to do repairs and a bunch of other headaches. Add children into that equation and it equals stress. I now want to buy a home.

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My question is, do you think January going to be a better time to buy?

Yes.

As you say everything is pointing to drops and we should be in full on crash mode by then. I remain bearish and expect to see clear signs of this by the autumn. If not, I turn bull and look to buy as soon as. In any event I wish to buy within 1 or 2 years because I am sick of renting.

My second question is, do you think we'll still see fixed 2 year deals that are available now in 6 months time? In your opinion will they be better or worse?

Dunno. For me this is not an issue as I have enough savings so that what is key is the price and what percentage of the price my deposit will be. I would suspect that deals will be worse, because I would imagine interest rates may be going up by then. You have to balance the mortgage cost going up versus the house price drop. To my mind, the savings from the house price drop should easily offset interest rate rises. I could well be wrong however. I think the key to your decision here is your LTV.

Best of luck

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Thanks Bam for a useful reply. Definitely worth looking in to.

To everyone else, just my choice that I don't want to raise kids in rented accomodation. There's absolutely nothing wrong with renting a family home, but in my experience I don't want the uncertainty of being thrown out because the landlord wants to sell. We've also had landlords not bother to do repairs and a bunch of other headaches. Add children into that equation and it equals stress. I now want to buy a home.

2 things:

(1) where are you in the country so we can compare rent vs buy prices

(2) ever considered a long tenanncy - 3 years say?

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Thanks Bam for a useful reply. Definitely worth looking in to.

To everyone else, just my choice that I don't want to raise kids in rented accomodation. There's absolutely nothing wrong with renting a family home, but in my experience I don't want the uncertainty of being thrown out because the landlord wants to sell. We've also had landlords not bother to do repairs and a bunch of other headaches. Add children into that equation and it equals stress. I now want to buy a home.

Or find yourself a professional landlord that's in it for the long term, carries out repairs promptly and values good tenants that respects the home and pays the rent on time. It cut's both ways remember.

However, me thinks your mind is already made up. Good luck whichever way you decide to go.

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I wouldn't have kids in a rented property. I have been renting for nearly 20 years and many times I've had to move home at 2 months notice when I didn't really want to. There's no way I'd raise kids like that.

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Or find yourself a professional landlord that's in it for the long term, carries out repairs promptly and values good tenants

A rare breed. And how do you know the LL is like this until you move in? I'd happily rent if it was like the European system and I had security of tenure and could fix problems myself. But it isn't like that, so I hate it

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I wouldn't have kids in a rented property. I have been renting for nearly 20 years and many times I've had to move home at 2 months notice when I didn't really want to. There's no way I'd raise kids like that.

which part of the country are you in then? I find renting in the North excellent if you know what you are doing

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I wouldn't have kids in a rented property. I have been renting for nearly 20 years and many times I've had to move home at 2 months notice when I didn't really want to. There's no way I'd raise kids like that.

That was my childhood, we moved house so many times I lost count of the schools I went to. I wouldn't consider my mother a bad parent for it (not suggesting you are) and it never did me any harm. You forget how resilient kids can be.

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Or find yourself a professional landlord that's in it for the long term, carries out repairs promptly and values good tenants that respects the home and pays the rent on time. It cut's both ways remember.

However, me thinks your mind is already made up. Good luck whichever way you decide to go.

Professional landlord? You're having a laugh!

The landlords get to do checks on tenants, but it doesn't work the other way around! You really don't know what your landlord is like, until you need them to do something.

If we had more rights, like in countries like Germany I may consider it.

Anyway, this thread wasn't supposed to be about renting or buying family homes. It was supposed to be about whether buying now was better than waiting until the new year!

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Professional landlord? You're having a laugh!

The landlords get to do checks on tenants, but it doesn't work the other way around! You really don't know what your landlord is like, until you need them to do something.

If we had more rights, like in countries like Germany I may consider it.

Anyway, this thread wasn't supposed to be about renting or buying family homes. It was supposed to be about whether buying now was better than waiting until the new year!

Yes, I know it's rare but they do still exist and it's hard work to locate one, but a bit of hard work and investigation can pay dividends.

Well in that case, I stand by my long standing predictions from 2006 in that buying in 2013/2014 is going to be the better time to buy, or maybe even later (hence why I reckoned you should continue to rent for 3 or 4 years).

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Yes, I know it's rare but they do still exist and it's hard work to locate one, but a bit of hard work and investigation can pay dividends.

Well in that case, I stand by my long standing predictions from 2006 in that buying in 2013/2014 is going to be the better time to buy, or maybe even later (hence why I reckoned you should continue to rent for 3 or 4 years).

Not many people here can even give me a proper answer as to what they think will happen in the next 6 months, with regards to rates and prices. With all due respect I don't think anyone has a proper clue what's going to happen in 3 to 4 years time, and that's just too long for us to wait. I'd rather buy within the next year. Thank you for your input though.

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Professional landlord? You're having a laugh!

The landlords get to do checks on tenants, but it doesn't work the other way around! You really don't know what your landlord is like, until you need them to do something.

If we had more rights, like in countries like Germany I may consider it.

Anyway, this thread wasn't supposed to be about renting or buying family homes. It was supposed to be about whether buying now was better than waiting until the new year!

Hi guys! Been lurking on HPC for years and this is my first post..

I'm in very much the same place as the OP so anyone's views on buying over the next six months much appreciated (and I'm sure by others who will look at the thread). We seem to now be in a critical phase, and yes I know one could, and many did, say the same thing at many points over the last few years, but in my view the crash is slowly happening already. However, I think it will be a long drawn out process, i.e. in non inflationary terms it may not be steep, so there may not be such a great windfall for HPCers soon. Now or Jan may not make much difference. I may want to go abroad to work next year, and if it is a choice between waiting and renting a place out, I may be better off to buy late in the year/Jan even if there is a gradual crash over the coming months/years. One can't wait for ever - and it has already been three years (longer than I would have liked).

Also just to second the above - the question was about buying, clearly the OP has personal reasons, like me, why he wants to, and whether those reasons are good or not, that was his question and the purpose of the thread. And let no one even try and pretend there are not solid reasons for wanting to buy, if there were not we would not all be on this forum!

Cheers

S

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Sorry, but didn't even get past the second sentence. Whats wrong with renting a family home?

I have friends who have raised children in a rented home. They seem unaffected by such "lowly" beginnings.

Hell, I was raised in rented accommodation and I turned out OK.

(Well, opinion is divided on that last point.)

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Yes.

As you say everything is pointing to drops and we should be in full on crash mode by then. I remain bearish and expect to see clear signs of this by the autumn. If not, I turn bull and look to buy as soon as. In any event I wish to buy within 1 or 2 years because I am sick of renting.

Dunno. For me this is not an issue as I have enough savings so that what is key is the price and what percentage of the price my deposit will be. I would suspect that deals will be worse, because I would imagine interest rates may be going up by then. You have to balance the mortgage cost going up versus the house price drop. To my mind, the savings from the house price drop should easily offset interest rate rises. I could well be wrong however. I think the key to your decision here is your LTV.

Best of luck

Very valid points here Shylock.

If the properties we were looking at fall to the 250K mark, then we would have saved about 6k in stamp duty, which could be used to increase our deposit. Therefore lowering our LTV. It's swings and roundabouts really. We are saving between now and January as much as possible.

I personally can't see rates shooting up that high in January, in comparison to what they are now.

Even if the base rate rises, will fixed rates rise too? I'm sure people on trackers will start to worry, but how will it affect fixed rate mortgages?

One other thing to consider is, just because the government didn't mention quantitive easing in their emergency budget, doesn't mean it might not happen again. If prices decline in the next 4 to 5 months they might print more money at the end of the year, to try and prop up lending again.

If prices stay stagnant now and quantitive easing doesn't take place, then it will be up to the banks to lend and then what will happen? Rates will rocket. This feels like catch 22. Prices may fall, but rates will rise, so where does that leave your average person wanting to buy property?

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I rent with kids and the disadvantages outweigh the advantages. There's nothing wrong with renting with kids, but I can see why the OP would rather buy.

I keep thinking fixed-rate mortgage rates will go up, and then they go down even further. I can't see them going up much by January. The chances of house prices rising significantly by January seem very close to nil, whereas the chances of pricing falling significantly seem, well, certainly higher than nil. However, there are advantages to buying in a falling market, and even when prices are at their peak, you can still grab a bargain. Historically, supply falls in January, but we're not in a normal market, so supply might increase. Who knows?

As far as my plans, if I see that dream house I'll go for it, but until them I'm happy to bide my time and put up with renting for another few months.

Edited by pablopatito

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We will see whether prices go down in the next 6 months, stay the same or rise. If they do rise, I doubt they will rise my much.

Quite.

2 year fixed rate deals may not be as good in 6 months time, but frankly is the first 2 years of a 25 deal a deal-breaker??

Now or Jan may not make much difference. I may want to go abroad to work next year, and if it is a choice between waiting and renting a place out, I may be better off to buy late in the year/Jan even if there is a gradual crash over the coming months/years.

Why on earth would you want to buy a UK house now if you're thinking of working abroad next year? Are you really after a home or just a buy-to-let investment?

Fine to rent out a house you already have, but I wouldn't consider buying a new house if there was a possibility I might not be in the same country next year.

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Even if the base rate rises, will fixed rates rise too?

Fixed rates will also go up I would assume. Why wouldn't they?

One other thing to consider is, just because the government didn't mention quantitive easing in their emergency budget, doesn't mean it might not happen again. If prices decline in the next 4 to 5 months they might print more money at the end of the year, to try and prop up lending again.

My understanding from the last BoE minutes is that there doesn't appear to be much appetite for QE. I'd be surprised.

If prices stay stagnant now and quantitive easing doesn't take place, then it will be up to the banks to lend and then what will happen? Rates will rocket. This feels like catch 22. Prices may fall, but rates will rise, so where does that leave your average person wanting to buy property?

If rates rise, property becomes more unaffordable leading to further drops.

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Quite.

2 year fixed rate deals may not be as good in 6 months time, but frankly is the first 2 years of a 25 deal a deal-breaker??

Well in the first 3 to 4 years we'd hope to overpay as much as we could on the mortgage, before kids come into the equation. I understand your point but a slight change in rate means we could be paying less in overpayments in those two years.

Edited by Speak&Spell

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  • 259 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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