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Tragedy Of Trapped Homeowners

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Scottish Estate Agent Wants Support For 'Frustrated Middle Movers'

As a result of buying during the property bubble, an estimated two million homeowners across the UK are "trapped" and have no chance of trading up.

With the expectation of moving on quickly from their first home during the property boom, 59 per cent of young homeowners made compromises on their first purchase in order to get a foot on the property ladder - and many are now stuck in the "compromise" property.

One in three compromised on the location of their property, 30 per cent compromised on the size, and 18 per cent settled for fewer bedrooms than they would have liked.

A further 18 per cent bought their first property with less outdoor space than they would have liked and 5 per cent said they were forced to compromise on the style of the property.

Truly tear-jerking.

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As a result of buying during the property bubble, an estimated two million homeowners across the UK are "trapped" and have no chance of trading up.

As a result of not buying during the property boom a seriously large number of renters can move, trade up, trade down and generally do what they like.

:P

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As a result of not buying during the property boom a seriously large number of renters can move, trade up, trade down and generally do what they like.

:P

Yip - going for a job interview on Friday in a different part of the country. Hope to slip in the point that I'm renting so can begin as soon as possible.

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Millions bought houses they didn't want

Yep, I remember seeing it on the News, frog marched to the viewing, then held at gun point at the bank when signing the mortgage deal, then told their families would be shot if they didn't sign the contract.

Bless 'em.

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These will be motivated sellers. This will help keep prices lower for years by ensuring a steady supply of houses for sale.

Err, no. Chances are they don't have enough equity to move up (or back into renting) but they can still pay the mortgage each month. Where's the motivation for selling at a low price there? If they sell they'll only realise any losses they've made and they'll be in a worse position.

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Err, no. Chances are they don't have enough equity to move up (or back into renting) but they can still pay the mortgage each month. Where's the motivation for selling at a low price there? If they sell they'll only realise any losses they've made and they'll be in a worse position.

So they can buy a larger place at a lower price?

The problem with waiting for prices to recover is that then you will have to pay more for the property you want to live in.

Also to use a hackneyed bull argument phrase - why put your life on hold? If you want to move somewhere bigger, sell and buy at the prevailing market price.

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Seriously, what a tosh article. Every single house purchase is a compromise-

location

price

size

nobody gets what they want at the price they want, where they want. You prioritize on what is most important to you and compromise on the rest.

duh.

Edited by Van

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These will be motivated sellers. This will help keep prices lower for years by ensuring a steady supply of houses for sale.

a very long drip-drip time, mind you

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Millions bought houses they didn't want

Yep, I remember seeing it on the News, frog marched to the viewing, then held at gun point at the bank when signing the mortgage deal, then told their families would be shot if they didn't sign the contract.

Bless 'em.

:lol:

The survey is interesting, though, in that people actually felt that they were 'forced to buy' and 'forced to compromise'.

The incessant goading of the property porn programmes obviously worked. These people didn't buy a home at all, they bought into an idea . . . which turned out to be a ladder with one rung.

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Err, no. Chances are they don't have enough equity to move up (or back into renting) but they can still pay the mortgage each month. Where's the motivation for selling at a low price there? If they sell they'll only realise any losses they've made and they'll be in a worse position.

that's right and if they sell they'll expect never to be able to get another mortgage and their tracker mortgage is much less than rent would be.

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So they can buy a larger place at a lower price?

The problem with waiting for prices to recover is that then you will have to pay more for the property you want to live in.

Also to use a hackneyed bull argument phrase - why put your life on hold? If you want to move somewhere bigger, sell and buy at the prevailing market price.

how? they bought with no deposit or 110% IO mortgage so they'll have no equity so no deposit on the next house = no mortgage available. Can't just lier loan it these days you know

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So they can buy a larger place at a lower price?

The problem with waiting for prices to recover is that then you will have to pay more for the property you want to live in.

Also to use a hackneyed bull argument phrase - why put your life on hold? If you want to move somewhere bigger, sell and buy at the prevailing market price.

Because if you are in negative equity, or your equity isn't high enough for a mortgage on the new place, then you don't have the choice. The only thing you can do is keep paying the mortgage every month, and maybe use some spare cash to pay off a bit more.

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I can relate to this article.

I would much rather have bought an 18 bedroom gothic mansion with a couple of hundred acres, a trout lake and a bit of ancient woodland. If we had a proper socialist government everyone would have at least two gothic mansions.

Edited by pilchardthecat

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Because if you are in negative equity, or your equity isn't high enough for a mortgage on the new place, then you don't have the choice. The only thing you can do is keep paying the mortgage every month, and maybe use some spare cash to pay off a bit more.

Fair points both yours and athom.

I was more concerned with the use of the term "motivated" since they have no ability to sell, let alone motivation. And then I got carried away. :)

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I think this is an important sign -- that the "first rung" guys cannot afford the "second rung".

I have already noticed this in my area that the prices for the "second rung" have started to come down quicker than "first rung" houses (the £20K to £40K falls are on the 3-bed family homes with gardens and garages). I suspect this is because second rung houses tend to be £100K+ more than first rung homes and so many of these "first rungers" will already be in negative equity (indeed, even if they are not), so there is no way banks will extend those mortgages so people can trade up.

The fall of "second rung" prices will force "first rung" prices down. The whole thing is a house of cards that is just ready to collapse.

In my view is that only about 30 percent of income earners in Britain can afford a mortgage of above £100K in a climate of responsible borrowing with viable interest rates for both mortgagee and mortgager. The problem with moving from first rung to second rung, even if you have 100 percent equity in your home, is that you still need to find someone who will lend you that £100K+.

It is essentially the same problem as FTBs. Who is going to lend the seventy percent of people in Britain who earn less than £40K a year over 100 grand, unless the back stop is making money out of repo?

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As a result of not buying during the property boom a seriously large number of renters can move, trade up, trade down and generally do what they like.

:P

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Millions bought houses they didn't want

Yep, I remember seeing it on the News, frog marched to the viewing, then held at gun point at the bank when signing the mortgage deal, LIAR LOAN - then told their families they would be shot if they hadn't signed the contract.

Bless 'em.

:D:D

Corrected. [sorry Ut!].

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It is essentially the same problem as FTBs. Who is going to lend the seventy percent of people in Britain who earn less than £40K a year over 100 grand, unless the back stop is making money out of repo?

Most banks even now I would've thought. £100k is only 2.5 times £40k, I'd have thought that it would be easy enough to get that much even now unless you're mired in negative equity on an existing place, have a dreadful credit history etc.

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  • 312 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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