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Skipton Crash

Last Bear Turning Bull?

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For a few years now (since 2005), I have fervently believed that UK housing is massively overvalued. I still feel that way, and I am pretty sure there will be a sharp correction in the future at some point. The longer it goes on, the worse it will end up being it seems...

However, I am now 35. I am a single dad, although my son is now 11. We are privately renting, and admittedly have had a slightly better experience than most with this - so far, decent landlords apart from one exception. I feel as though the government will do whatever it takes to stop house prices sliding and will throw as much taxpayers' money into it as they feel is necessary to stop a correction. In the long run, it feels like they will bankrupt the country rather than let the markets provide the necessary medicine. I am reluctant to make any kind of financial investment in our house (redecoration etc) as at any time the landlord can have a change of heart and just kick us out with 2 months notice, through no fault of our own. It really does not feel like a home at all.

I am running out of time to buy somewhere. Due to the new MMR rules, I will probably be unable to get a mortgage after I am 40. I realistically, have 4 and a bit years to buy...

I am seriously considering buying a house next year even though I will struggle to afford it (although not impossible). I hate the current situation. :-/

Does anybody have any positives? Can anybody offer any hope?

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For a few years now (since 2005), I have fervently believed that UK housing is massively overvalued. I still feel that way, and I am pretty sure there will be a sharp correction in the future at some point. The longer it goes on, the worse it will end up being it seems...

However, I am now 35. I am a single dad, although my son is now 11. We are privately renting, and admittedly have had a slightly better experience than most with this - so far, decent landlords apart from one exception. I feel as though the government will do whatever it takes to stop house prices sliding and will throw as much taxpayers' money into it as they feel is necessary to stop a correction. In the long run, it feels like they will bankrupt the country rather than let the markets provide the necessary medicine. I am reluctant to make any kind of financial investment in our house (redecoration etc) as at any time the landlord can have a change of heart and just kick us out with 2 months notice, through no fault of our own. It really does not feel like a home at all.

I am running out of time to buy somewhere. Due to the new MMR rules, I will probably be unable to get a mortgage after I am 40. I realistically, have 4 and a bit years to buy...

I am seriously considering buying a house next year even though I will struggle to afford it (although not impossible). I hate the current situation. :-/

Does anybody have any positives? Can anybody offer any hope?

With regard to the two months notice, I agree with you, which is why I negotiate a twelve month rental agreement and extend it for a further twelve months when it has six months to run, so that I have between six and eighteen months unexpired at all times (currently fourteen months).

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Only one comment - you say that you would struggle to qualify for a mortgage with the mmr regs after 40, presumably because you're thinking of a 25 year term. Mortgages can be significantly shorter than that.

If I was looking to buy now (i'm not because I morally object to this market), I would look at a 10 year fix and a 14 year term that also allows overpayments. You can get 10 year fixes at around 3-3.5% if you have a good deposit.

I sympathise with your situation - do what is best for your health and sanity.

There are also other alternatives given your situation (i,e, have children). So you could play them at their own game. Perhaps put all your salary above the personal allowance into a pension, and claim every tax credit, housing benefit under the sun. You'll be saving for your future, and probably be better off in the present too. Its ethically questionable, but no more so then what the system has created.

It's even recommended by those in government.

http://www.labourlords.org.uk/credit-where-its-due

Edited by Frugal Git

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A bit surprised by your pessimism as prices in Skipton have gone nowhere since 2006. On the first page the Chinthurst Cottage is sold at a loss after eight years. There is one that has doubled but is clearly a do me up flip (Tarn Moor). Possibly been gutted and doubled in size.

I'd be congratulating myself that I had stayed out of the Market and not had a money pit around my neck that had made nothing.

Since 2004 my balance sheet has grown on my investments only , the house has been a liability...because like Skipton the Midlands has gone nowhere.

http://www.rightmove.co.uk/house-prices/Skipton.html

Edited by crashmonitor

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Actually looked with a friend in that area not long ago.

Everything we looked at had dropped about 15-25% in real terms since about 2004.

I wouldn't buy there as it still seemed very overpriced to me.

You are in exactly the sort of area that'll contract horribly if (when) there's a crash and/or people start to bin off second homes.

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Actually looked with a friend in that area not long ago.

Everything we looked at had dropped about 15-25% in real terms since about 2004.

I wouldn't buy there as it still seemed very overpriced to me.

You are in exactly the sort of area that'll contract horribly if (when) there's a crash and/or people start to bin off second homes.

Even so why beat yourself up about not being in a Market that has gone nowhere. Cambridge, London...I could understand that.

At the end of the day the damage was done in the North between 1997-2004, nothing the OP could do back then. Done the right thing since and stayed out. Don't know going forward.

Edited by crashmonitor

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I appreciate that terms can be less than 25 years, but less than 20 years is going to significantly increase payments which I could already only just afford. I am going to see how things play out this year and make a decision possibly next winter. Prices here have definitely gone up since 2006 (back then, you could pick up an average 2-bed terrace for maybe 85k, but nowadays people are asking for 120k for the same houses. Even allowing for inflation, that's a pretty big increase. I appreciate that asking prices are not the same as sold though - maybe buyers are more open to negotiation these days? That rightmove link was very interesting though! It certainly looks like Skipton has been a very mixed bag! It looks like the figures are from land registry data, rather than asking prices. Maybe there is still hope? :-)

In the meantime, I have asked the local estate agents to keep me in mind if they have any distressed sellers who need a buyer fast. As a first time buyer, luckily enough to have a decentish deposit (very grateful to the BoMaD), I fully expect to be able to negotiate a significant discount (maybe 15-20% if I'm lucky?). I have also registered with local housing associations. There seems to be finally a decent drive to get the idea of "affordable housing" off the ground. There are a lot of new developments in the pipeline!

I am hoping that whoever wins the election will realise that they won't be able to keep all the plates spinning for 5 more years and decides to grasp the nettle so that there is time to recover the economy before the next election. It feels like this will be more likely if the tories win. Labour will be desparate to not look incompetent (again) with the economy...

Just hoping something works out! Thanks for the advice so far!

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Looking at that rightmove data again, it actually doesn't look like (sold) prices have gone up that much.... interesting.... I think it may just be asking prices that are inflated :-)

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I appreciate that terms can be less than 25 years, but less than 20 years is going to significantly increase payments which I could already only just afford. I am going to see how things play out this year and make a decision possibly next winter. Prices here have definitely gone up since 2006 (back then, you could pick up an average 2-bed terrace for maybe 85k, but nowadays people are asking for 120k for the same houses. Even allowing for inflation, that's a pretty big increase. I appreciate that asking prices are not the same as sold though - maybe buyers are more open to negotiation these days? That rightmove link was very interesting though! It certainly looks like Skipton has been a very mixed bag! It looks like the figures are from land registry data, rather than asking prices. Maybe there is still hope? :-)

In the meantime, I have asked the local estate agents to keep me in mind if they have any distressed sellers who need a buyer fast. As a first time buyer, luckily enough to have a decentish deposit (very grateful to the BoMaD), I fully expect to be able to negotiate a significant discount (maybe 15-20% if I'm lucky?). I have also registered with local housing associations. There seems to be finally a decent drive to get the idea of "affordable housing" off the ground. There are a lot of new developments in the pipeline!

I am hoping that whoever wins the election will realise that they won't be able to keep all the plates spinning for 5 more years and decides to grasp the nettle so that there is time to recover the economy before the next election. It feels like this will be more likely if the tories win. Labour will be desparate to not look incompetent (again) with the economy...

Just hoping something works out! Thanks for the advice so far!

194 Greatwood Avenue bought £85,000 in 2005 sold £70,000 2014. Often comparing houses and not taking into account improvements and the tens of thousands some vendors spend is where you are going wrong. Greatwood shows what happens when you don't keep up the spec.

You've won big time by staying clear.

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i would say just buy if you need to buy.

i'm intending to buy this year as, like you i believe the government will do absolutely anything it takes to keep it going.

i intend to get "on the ladder" (such a ridiculous term) before QE2 kicks in.

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194 Greatwood Avenue bought £85,000 in 2005 sold £70,000 2014. Often comparing houses and not taking into account improvements and the tens of thousands some vendors spend is where you are going wrong. Greatwood shows what happens when you don't keep up the spec.

You've won big time by staying clear.

There's no archive listing on RM or Zoopla. Perhaps it was a divorce buy out transaction.

Although there is some encouragement for weakness in parts of Yorkshire... some of dariuszen's posts are full of hope for deals to come, and refreshingly he puts his own interest first, instead of awarding excuses and victimhood to people who paid stupid high prices, as was happening in 2008-09 onwards (the pathetic excuses for the very people who outbid us by fortunes.)

Wish you would hurry up and buy B&S, so we can begin the crash. :P

I know the stats are always messed with but here in my street in Yorkshire....

5 houses for sale

1 3 bed bungalow been on for six months down from ***k to ***k still no takers- lovely house I have my eye on this.

1 extended 3 bed semi on for six months no takers down from ***k to ***k

1 2 bed bunglaow down from ***k to ***k still unsold taken off market

1 sold bungalow went for ***k that was a 30k price cut owned by an old dear who passed and family wanted shot of it quick. It sold just before the new mortgage regulations.

I keep a close eye on my area about 10 miles and just watch. They aren't affordable yet but lots of old folks croaking it and a slew of nice bungalows all coming down in price.

Not there yet but another year or so I will consider buying as 3.5 times my wage will get me a lovely big bungalow of a seller who will bite my hand off. The media try to tell me different but I dont give a shit all I care about is in the area I am living and even in my street big falls already.

Thats all I want a family home with a garden without crippling myself financially and its getting ever closer.

Edited by Venger

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For a few years now (since 2005), I have fervently believed that UK housing is massively overvalued. I still feel that way, and I am pretty sure there will be a sharp correction in the future at some point. The longer it goes on, the worse it will end up being it seems...

However, I am now 35. I am a single dad, although my son is now 11. We are privately renting, and admittedly have had a slightly better experience than most with this - so far, decent landlords apart from one exception. I feel as though the government will do whatever it takes to stop house prices sliding and will throw as much taxpayers' money into it as they feel is necessary to stop a correction. In the long run, it feels like they will bankrupt the country rather than let the markets provide the necessary medicine. I am reluctant to make any kind of financial investment in our house (redecoration etc) as at any time the landlord can have a change of heart and just kick us out with 2 months notice, through no fault of our own. It really does not feel like a home at all.

I am running out of time to buy somewhere. Due to the new MMR rules, I will probably be unable to get a mortgage after I am 40. I realistically, have 4 and a bit years to buy...

I am seriously considering buying a house next year even though I will struggle to afford it (although not impossible). I hate the current situation. :-/

Does anybody have any positives? Can anybody offer any hope?

You can`t afford it, so why do it? Many who struggle on to the snake now are going to mess up badly. The sheeple behaviour around housing has changed dramatically since the one off credit event that took shape in the noughties, that nearly free credit for the masses experiment will never be repeated on that scale in our lifetimes IMO. We have gone from a feeding frenzy with prices being pushed up and up by Liar Loans to houses on the market for years and emergency measures to prop up the dying remains. That gives me satisfaction because I have managed to average 400 p.m rent for decent properties throughout this madness with repairs done and the flexibility to move quickly if I need to. IMO if you have an 11 year old the priority is multiple years living expenses in the bank, not borrowing money to join a collapsing Ponzi scheme.

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Skipton Crash, I'm a couple of years older. Your pensionable retirement age will be 68 I think, whereas mine is 67.5.

No advice to offer but I do have something worth pondering over. Surely the MMR will have to take into account that some of us subject to the higher retirement age and make mortgage terms available so that they end at age 68 rather than 65?

My dad was about 47 when he and my mum applied for a mortgage (albeit for a discounted council house). That one HAD to complete when he turned 65 and so it was done on a 17 year term.

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That's a good point I guess. I was under the impression it was very difficult after you hit 40... Shorter terms are inherently less affordable I guess and I would be cutting it fairly close (in terms of salary multiples) as I am. I don't know if lenders factor in the fact that you may be earning less when you pass 65?

Not sure - I have not yet applied for, or been approved for, a mortgage. I will investigate this over the summer :-)

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That's a good point I guess. I was under the impression it was very difficult after you hit 40... Shorter terms are inherently less affordable I guess and I would be cutting it fairly close (in terms of salary multiples) as I am. I don't know if lenders factor in the fact that you may be earning less when you pass 65?

Not sure - I have not yet applied for, or been approved for, a mortgage. I will investigate this over the summer :-)

If you have good credit and can put up a decent deposit they will probably bite your arm off, who else can they lend to nowadays? You will still be buying into a massive bubble though......

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