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tatty

Just Thrown £45k In The Bin Me Thinks...

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Circumstances have conspired to push me into buying just outside Southampton. The house is nice enough, 4 bed semi (3 doubles) for £172k. I'm hoping my deposit of £45k will absorb most of the falls that i'm sure are coming.

I'm trying to look on the positive side, hoping that when I come to try and trade up in a couple of years then the better house will be that much more affordable (relatively). Assuming i'm not in NE of course.

I can't work out whether a HPC now i've bought will be a disaster for me since I know i'll be buying better. Obviously waiting a couple of years would have put me in a much better position, but there you go.

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Circumstances have conspired to push me into buying just outside Southampton. The house is nice enough, 4 bed semi (3 doubles) for £172k. I'm hoping my deposit of £45k will absorb most of the falls that i'm sure are coming.

I'm trying to look on the positive side, hoping that when I come to try and trade up in a couple of years then the better house will be that much more affordable (relatively). Assuming i'm not in NE of course.

I can't work out whether a HPC now i've bought will be a disaster for me since I know i'll be buying better. Obviously waiting a couple of years would have put me in a much better position, but there you go.

The mind boggles. Are you sane? 'I'm hoping my deposit of 45k will absorb most of the falls that I'm sure are coming.'

Dear oh dear. Hope that 45k was easy come because it's sure going to be easy go.

Buying at the top of a bubble is excusable if you think it is going to keep going up. But buying just over the peak of a bubble - you are bonkers.

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Marina,

Don't be too hard, there are some strong forces at work.

Tatty, save like hell and do what ever you can to keep the house sellable at the drop of a hat. Good luck.

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I know it seems that way but at the moment i'm living in Southampton while my other half and son are in Plymouth. The plan was for me to rent and commute at weekends while prices drop over the next couple of years. Unfortunately, we're both getting really hacked off with it and I don't want to risk too much for money if you know what I mean.

I'm still doing it through clenched teeth though.

I suppose a suggestion to rent will come up but with a 5 year old and a labrador it isn't really feasible.

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I guess it depends, you need to play that off against the extra deposit you

would have by continuing to rent, versus the difference post-crash between

the rungs when you trade-up

.

The other risk is the attendant recession, which could cost any one of us our

jobs.

The short-term loss may turn out to be the better deal if your income

remains solid - but I can't be @rsed to try and do the maths :D

ABB

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I know it seems that way but at the moment i'm living in Southampton while my other half and son are in Plymouth. The plan was for me to rent and commute at weekends while prices drop over the next couple of years. Unfortunately, we're both getting really hacked off with it and I don't want to risk too much for money if you know what I mean.

I'm still doing it through clenched teeth though.

I suppose a suggestion to rent will come up but with a 5 year old and a labrador it isn't really feasible.

I rent - I've got a 16 year old, a 10 year old, two cats, a dog and a wife (mustn't forget the wife). We got booted out of our last place a while ago - found another (bigger) place easily enough. Bit of hassle - 3 brothers and a couple of mates - hire a van for the day and buy them all a take-away in the evening.

Okay, we've all got different agendas - but I am not risking my hard-earned in the property market any time soon.

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I rent - I've got a 16 year old, a 10 year old, two cats, a dog and a wife (mustn't forget the wife). We got booted out of our last place a while ago - found another (bigger) place easily enough. Bit of hassle - 3 brothers and a couple of mates - hire a van for the day and buy them all a take-away in the evening.

Okay, we've all got different agendas - but I am not risking my hard-earned in the property market any time soon.

That's fair enough mate, I don't doubt for a moment that you will be better placed than I will in 3 years time.

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Marina,

Having seen 2/3 of my family financially wiped out in the last bust I can only agree with your sentiments.

Unfortunately it didn't stop with the financial repurcussions. :(

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join the club.

im buying. i cant wait anymore. if i lose a few K - im beyond caring.

Me too, I almost bought earlier this year in Brough, East Yorkshire and have decided to buy a slightly better place for 5k more than the new build I was looking at. I know you will all hate me for it.

I can't say I am beyond caring but prices in this area are still going up, regardless of what all the stats are saying. The Brough area seemed to have lots of properties up and I was starting to get positive vibes about a price crash here but now its sale agreed and sold almost everywhere again, people are still buying new builds here in the droves and one 2-bed newbuild which came up for sale instantly sold when I had just viewed it and they are putting yet MORE new builds up.

Its depressing, but I want my own house, I have always wanted my own house and if the crash does come then hard luck for me. Its a 2 bed, very smart town house, doesn't need anything doing to it in a nice area with lovely gardens. £120,000 (it was up for £125,000). Putting 45k down on it, leaving some savings, and shares in reserve. Nethouse prices on my property from the last 10 years sickens me but its a bitter pill I have to swallow. I do love the house though. :)

I am not buying for an investment, I am buying because I want a home. I of course am shitting myself that it will be only worth 10p in 1 - 3 years. I will be here for a while anyway.

Anyway, ive rolled the dice. Lets hope for my sake its not snake eyes :)

So I can sympathise with you tatty, good luck anyway and to you RFD too.

Mike

Edited by stormy

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I spent years after the last bust advising people who were in negative equity. Basically helping them stall the lender or the lender's solicitors. I had literally loads of clients - many of whom really had no option but to go bankrupt. All types of people who for whatever reason had to give up their home. I have just about finished with the last one. However....I had my first new client the other day.

In my experience, negative equity is OK as long as you can aford the repayments and have no interntion of selling for a very long time. But anyone buying a house now should think very carefully about saving up enough money to pay the mortgage for at least 6 months in the event of a financial problem and having some form of payment protection insurance.

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For those of you that are buying ... if you're young ... for heaven's sake take a LONG fixed rate mortgage.

What stuffed many people last time was the sudden increases in their mortgages. And, with you youngsters taking on massive mortgages and IRs at historic lows, you really need to protect yourselves against the fact that in 5 years time IRs might be 10%. Who knows? Answer, no-one - but they have been there and much higher for long periods in recent history.

I have a brother who is still paying off the debt he incurred last time round when he handed the keys over to the building society. And he'll be paying it for the rest of his life. It's not a huge amount but it is going to follow him to his grave.

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tatty, right freds dead, et al

This artical from Evan Davis at the BBC last will go some way to cheering you up, I hope, especially the example he gives near the end of the artical.

http://news.bbc.co.uk/1/hi/business/3701070.stm

For those of you that are buying ... if you're young ... for heaven's sake take a LONG fixed rate mortgage.

Absolutely, do not be taken in buy the cheep start up deals, they WILL bite back later.

Good luck one and all.

Edited by FTBagain

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I think you guys are being a bit naive here...tatty so long as your buying the property to stay in for around 7-10 years, you should be fine. Otherwise any shorter term than that or if your buying it as an investment, then your going to have to think of negative equity.

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For those of you that are buying ... if you're young ... for heaven's sake take a LONG fixed rate mortgage.

What stuffed many people last time was the sudden increases in their mortgages. And, with you youngsters taking on massive mortgages and IRs at historic lows, you really need to protect yourselves against the fact that in 5 years time IRs might be 10%. Who knows? Answer, no-one - but they have been there and much higher for long periods in recent history.

I have a brother who is still paying off the debt he incurred last time round when he handed the keys over to the building society. And he'll be paying it for the rest of his life. It's not a huge amount but it is going to follow him to his grave.

I think Britannia have a 10 year fix at 4.7%

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Good luck with it, T.

It sounds like you can afford the debt service.

I hope the enjoyment you get from having your own home, will compensate

for any volatility you experience in your net worth. There are worse things in the world

than being underwater on an investment, if it is giving you day-to-day satisfaction

Thanks Dr B.

I'm fortunate in being employed in a secure job (no really) that is pretty well paid. If I wasn't or circumstances were a little different then I would be avoiding buying like i'll be dodging 'Bird Flu' when it starts wiping out thousands of us. lol.

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While I do expect a significant fall in prices to come, its worth bearing in mind that its not guaranteed! Some people on here would do well to remember that!

Nothing in life is guaranteed. Not a fall and not a rise.

How about a market that drifts sideways for 25 years?

Or a market that does fall say 50% and then, because the chickens have come home to roost, lots of our service industry jobs have moved abroad to join our manufacturing jobs etc etc i.e. our economy is buggered - how about a market that falls 50% and doesn't recover in our lifetimes because we truly are in a new paradigm? The poor in China and India etc start to enjoy gradually rising incomes and standards of living and we endure gradually falling incomes and standards of livings.

This seems to me where this is all heading.

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Just because you have a five year old and a labrador it doesn't mean you can't rent a home. We have 2 children and we are renting in Southampton. I know it is hard to find a landlord that will accept a pet, but it is not impossible.

Think outside the box!

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Why do people think of their deposit absorbing any drops???

I'm afraid I take a different view: It comes out of the lender's portion first, on the basis that any drop is money that I wouldn't have had to borrow!

Don't wish to patronise, just emphasize: Borrowed money is expensive.

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If you don't mind me asking, Tatty, what sort of discount did you negotiate below asking price? How does your price compare to what your recent sale prices of neighbouring houses on houseprices.co.uk?

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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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