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winkie

What Is Stopping You Buying

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Just thinking,

Why do you want to buy a property?

To live in Long term, or maybe moving sideways, or upwards in the future. ( a mortgage is portable ).

Do you have a deposit? 10%

Do you earn an income? Max 4 times sole 3.75 + 1 joint+1 bonus/overtime.

Does it matter if prices drop if you are in it for long term, and you take out a low rate say 5 year fixed at say 4.5%, , be quick these rates may not last.

I was in negative equity early 90's and lived through it.

If you can afford the monthly repayments, and purchase the right property, not forgeting to negotiate on price, as it is a buyers market, and can grab a good rate I can't see a problem.

House prices will fall, but thats not to say interest rates will rise. Was 12% in early 90's.

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Just thinking,

Why do you want to buy a property?

To live in Long term, or maybe moving sideways, or upwards in the future. ( a mortgage is portable ).

Do you have a deposit?  10%

Do you earn an income? Max 4 times sole 3.75 + 1 joint+1 bonus/overtime.

Does it matter if prices drop if you are in it for long term, and you take out a low rate say 5 year fixed at say 4.5%, , be quick these rates may not last.

I was in negative equity early 90's and lived through it.

If you can afford the monthly repayments, and purchase the right property, not forgeting to negotiate on price, as it is a buyers market, and can grab a good rate I can't see a problem.

House prices will fall, but thats not to say interest rates will rise. Was 12% in early 90's.

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Not quite sure what you want us to say! I don't want to buy a house cos I can't afford one I want (a small house in Worcestershire) and, well, I suppose I could with posh renting, but I think there's enough of a chance/risk that house prices will drop significantly for me to be able to afford one. It's pretty honest and straightforward I think.

I mean - houses are pretty pricy things and I don't want to pay over the odds and face repossession cos I don't earn that much.

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I have about a 20% deposit (if I bought now), and my salary is 3x the mortgage.

The problem is, the type of work I do is being outsourced to Asia, so my job is

not necessarily a safe one. Therefore I'm factoring in a 33% pay cut which would

then put the mortgage at over 5x - not something I want to be lumbered with!

I just want a reasonable sized and priced 2 bedroom end terrace or semi. Anything

bigger would be a bonus.

Edited by OzzMosiz

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Hi Winkie,

Of course it matters if I buy now and then prices drop. My mortgage would cost me substantially more if I bought now rather than in a couple of years - a 25 year mortgage is pretty long term ;)

Yes I have a good deposit and am extremely fortunate with my income. But why would I want to give it all away to some numpty to buy their overpriced ATM machine (I mean house...) which is dropping in value as we speak...

All in all it's a bit of gamble - interest rates could rocket. But unless I get a fixed 25 year deal, I'd be screwed even more as the debt would be huge...

I think I'll wait a bit!

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Just thinking,

Why do you want to buy a property?

To live in Long term, or maybe moving sideways, or upwards in the future. ( a mortgage is portable ).

Do you have a deposit?  10%

Do you earn an income? Max 4 times sole 3.75 + 1 joint+1 bonus/overtime.

Does it matter if prices drop if you are in it for long term, and you take out a low rate say 5 year fixed at say 4.5%, , be quick these rates may not last.

I was in negative equity early 90's and lived through it.

If you can afford the monthly repayments, and purchase the right property, not forgeting to negotiate on price, as it is a buyers market, and can grab a good rate I can't see a problem.

House prices will fall, but thats not to say interest rates will rise. Was 12% in early 90's.

I can just about afford to get a 'studio flat' ( which is basically a room someone has converted in an end terrace, bed in one corner of the living area). I earn above average for this area, i have a 10% deposit.

Now if i really really wanted to i could buy this place, I could lumber myself with a 100K mortgage and jump right in.

Im on a managers salary and all i could buy right now is this bedsit type mess, i would prefer not to have it and keep my £600 + other expenses.

I think i will wait a little while, and keep saving a decent amount a month, then maybe in 18 months / 2 years buy a semi.

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I am just waiting and hoping for a critical moment between a drop in houseprices and a rise in interest rates at which point I can lock in a rate for a cheaper house. Its a risk but I am prepared to take it, since the BOE appears willing to play with housing values. The reason it is so much faster and harder in Australia is because the Reserve Bank (the BOE equivalent) has one mandate only, and that is to manage inflation, so it doesn't get in the ring with managing house prices.

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Hi Winkie,

Of course it matters if I buy now and then prices drop.  My mortgage would cost me substantially more if I bought now rather than in a couple of years - a 25 year mortgage is pretty long term  ;)

Yes I have a good deposit and am extremely fortunate with my income.  But why would I want to give it all away to some numpty to buy their overpriced ATM machine (I mean house...) which is dropping in value as we speak...

All in all it's a bit of gamble - interest rates could rocket.  But unless I get a fixed 25 year deal, I'd be screwed even more as the debt would be huge...

I think I'll wait a bit!

Good for you, whatever you think best, but don't forget if your house drops so does everyone elses, and you can then buy a better property at a even cheaper price. By the way you can still get a 10 year fixed.

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For me it's a mixture of feeling ready to settle down and put down some roots plus the desire to have the security of knowing my home is my own and I can't be forced to move out by a landlord (it's happeded 3 times so far).

What's stopping me is the simple fact that I can't afford to buy ANYTHING. I'm in the low wage bracket, I take home around £13,000 a year, there's nothing out there I can afford.

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Good for you, whatever you think best, but don't forget if your house drops so does everyone elses, and you can then buy a better property at a even cheaper price. By the way you can still get a 10 year fixed.

Lets not forget that the differnt classes of houses will fall at differnt rates i.e

Flats may half, Detached may fall by a third.

Even if houses fell by the same percentage you would still be scrwed.

Lets say i bought the bedsit for 100K, 3 years later i want to move and its worth 70K that leaves me with 30K to find just so i can move. No chance of saving 30K when the mortgage costs are so high.

You could say i just need to live in the bedsit for 10 years and hope its worth more then but, i dont want to live in a bedsit for 10 years for a multitude of reasons.

Its just so much better to wait, economically and logically.

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Guest Time 2 raise Interest Rates

What's stopping me buying is the fact there's no money to be made by buying property for the next few years. Why buy something now when there's a good chance you can buy it for 30% less in a couple of years time or maybe even sooner. Anyone who thinks prices will stagnate are living in a dream world. Prices are on their way down and there's no stopping them. The party's over.

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don't forget if your house drops so does everyone elses, and you can then buy a better property at a even cheaper price

But my debt wouldn't fall would it!

If interest rates risen to high levels (compared to today), and I were to struggle with a mortgage on those higher rates, everyone else would struggle - and house prices would fall to compensate.

Also, I shouldn't ever struggle with a mortgage if I took only 3.5x (maybe 4x) my salary - i'd be a fool to take on much more!

So to sum it all up, house prices are too expensive! And I don't like being ripped off!!! :huh:

Edited by Jason

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But my debt wouldn't fall would it!

If interest rates risen to high levels (compared to today), and I were to struggle with a mortgage on those higher rates, everyone else would struggle - and house prices would fall to compensate.

Also, I shouldn't ever struggle with a mortgage if I took only 3.5x (maybe 4x) my salary - i'd be a fool to take on much more!

So to sum it all up, house prices are too expensive! And I don't like being ripped off!!!  :huh:

I think your right Jason, and I think the problem with this thinking is that once you are in the negative equity trap, you can't borrow more because you have already over borrowed. So where you once had a 280,000 house with a 250,000 morgage, you now have a 200,000 house with a 250,000 morgage. Who is going to lend you more?

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What's stopping me buying is the fact there's no money to be made by buying property for the next few years.  Why buy something now when there's a good chance you can buy it for 30% less in a couple of years time or maybe even sooner.  Anyone who thinks prices will stagnate are living in a dream world.  Prices are on their way down and there's no stopping them.  The party's over.

With all due respect, T2RTR I did not buy my property to MAKE money, I had no idea property would increase like it has. I brought it to house my family.

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Does it matter if prices drop if you are in it for long term, and you take out a low rate say 5 year fixed at say 4.5%, , be quick these rates may not last.

In parts of the country when people bought at the peak of the market in 1988, they didn't come out of negative equity almost ten years later.

My guess is that this time, should there be a full-scale property crash, that if you bought at the peak today you would not come out of negative equity perhaps for 15-20 years.

That is almost the lifetime of the entire mortgage. And I tell you why - that is because the bubble is a lot more pronounced and inflated than the last one was.

If you want to stand yourself in good stead over the long term then you do not buy at the peak of a cyclical market like the housing market, and it's as simple as that.

Edited by Warwickshire Lad

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all i can afford is a tiny shoebox studio flat (1 living/dinning/sleeping/kitchen space + shower/Pooh/piss room) for about £70K in a run down area.

Does anyone expect me to live in the same place for the next 25 years??? Or able to trade up?????? How is one able to raise a family?????

Edited by trev

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Guest Time 2 raise Interest Rates
With all due respect, T2RTR I did not buy my property to MAKE money, I had no idea property would increase like it has. I brought it to house my family.

With all due respect, buying property is how I make a living, and trying to make a living in the current property market is nigh on impossible. We've all got our different reasons for reading this web site, whether it be first time buyers, buy-to-letters, or people trading up, all I'm saying is that in my opinion if you don't need to buy in the next few years then don't. What have you got to lose?

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With all due respect, buying property is how I make a living, and trying to make a living in the current property market is nigh on impossible.  We've all got our different reasons for reading this web site, whether it be first time buyers, buy-to-letters, or people trading up, all I'm saying is that in my opinion if you don't need to buy in the next few years then don't.  What have you got to lose?

You have nothing to lose as long as you are happy in the situation you are in ;)

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Good for you, whatever you think best, but don't forget if your house drops so does everyone elses, and you can then buy a better property at a even cheaper price. By the way you can still get a 10 year fixed.

If my house drops in value, it really isn't my problem - but my landlord might start to sweat :lol:

Agreed I could get a 10 year fixed but I refuse to play this silly property game at the moment. I firmly believe that we are at the peak of the cycle and it makes no sense - financial or otherwise - to buy at the moment. As has been often said, "house prices are a matter of opinion: debt is real."

I'll take my chances that prices will drop and then buy. The debt will be less. If I am fortunate I will get the timing right before interest rates rocket. (fingers crossed!)

Out of interest Winkie - do you own your home now? Have you been tempted by doing an STR flit? I think I would be if I had been living in the UK and therefore bought when prices were affordable.

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Just thinking,

Why do you want to buy a property?

To live in Long term, or maybe moving sideways, or upwards in the future. ( a mortgage is portable ).

Do you have a deposit?  10%

Do you earn an income? Max 4 times sole 3.75 + 1 joint+1 bonus/overtime.

Does it matter if prices drop if you are in it for long term, and you take out a low rate say 5 year fixed at say 4.5%, , be quick these rates may not last.

I was in negative equity early 90's and lived through it.

If you can afford the monthly repayments, and purchase the right property, not forgeting to negotiate on price, as it is a buyers market, and can grab a good rate I can't see a problem.

House prices will fall, but thats not to say interest rates will rise. Was 12% in early 90's.

Hi Winkie (why does writing that feel so WRONG?!)

I had the same thought a few weeks ago, and ended up crunching some numbers along with a few others. Although some people disagreed, we came to the conclusion that it is a tough decision to make but comes down to how much you are prepared to pay for the certainty of knowing where you will be living (although there is an assumption that you will be able to continue paying the mortgage).

Assuming if prices fall they will fall by 30%, then rise at long run average 5%, versus prices not rising for next 5 years then resuming 5% upward trend.

If you believe that prices will fall over next 5 yrs, it makes more financial sense to wait. You will be tens of thousands worse off if you buy now.

If you believe that prices will remain stable there is probably little in it.

If you believe that prices will continue to rise, better to buy now.

The weight of opinion is now beginning to shift towards falls, hence better to wait unless you value having your own place in the tens of thousands of pounds. In doing this you also risk being stuck in the same house for a long time waiting to be freed from neg. equity.

Obviously, this argument has assumptions coming out of its ears. In my opinion, times are very uncertain by recent historical standards. Hence it makes sense to be overly cautious at the moment.

Q. If the internet had been around for the past 50 yrs, would our predecessors have spent as much time discussing the housing market? If we think the answer is no, then perhaps it points to much greater uncertainty at present. As such, we should seek higher risk premiums (to paraphrase Mr Greenspan). This translates to seeking more for your money if you choose to buy a property.

At present, we get less than ever before for our money. Sounds like the wrong time to buy.

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If my house drops in value, it really isn't my problem - but my landlord might start to sweat  :lol:

Agreed I could get a 10 year fixed but I refuse to play this silly property game at the moment.  I firmly believe that we are at the peak of the cycle and it makes no sense - financial or otherwise - to buy at the moment.  As has been often said, "house prices are a matter of opinion: debt is real."

I'll take my chances that prices will drop and then buy.  The debt will be less.  If I am fortunate I will get the timing right before interest rates rocket. (fingers crossed!)

Out of interest Winkie - do you own your home now?  Have you been tempted by doing an STR flit?  I think I would be if I had been living in the UK and therefore bought when prices were affordable.

No way would I sell to rent, I love living where I do and will always need a place to live. What the property is worth is irrelevent to me, as long as I am able to pay the bills I am happy.

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Guest Time 2 raise Interest Rates
You have nothing to lose as long as you are happy in the situation you are in ;)

Well if that's aimed at me i couldn't be happier. I'm lucky enough to be in the situation where as i can suffer a few quiet years on the workfront. Its the better

option than trying to make a living in a falling market. ;)

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Guest Bart of Darkness

Why do I want to buy: More space (especially as I work from home). More privacy (I live in a flat at the moment) and to live in a better area.

Why haven't I bought yet: Still saving for a deposit. I have 20% (at current prices), ideally I would like at least 33%. Houses are way overvalued at the moment and the past year has seen clear signs of a downturn in the making.

At present I don't have to buy, so I won't. I should have my 33% deposit by mid-2007, I'll see what prices are like then.

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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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