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TheCountOfNowhere

What Ever Happened To The Media Reports That Its Cheaper To Buy...

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Funny you should mention this. I rent in London and my flatmate and I pay a combined total of £2000 a month. An identical property to mine on the other side of the road went on the market last week and I did some rough calculations. Asking price £900,000. Assuming (and it's a big assumption) a 3% interest-only mortgage over a 25 year period, I'd be paying £2250 in interest payments alone before fees, tax, maintenance etc. Not that a bank would ever lend me that kind of sum! Incidentally, despite this being a supposedly white-hot part of the London property market, I doubt the asking price would have been any different 1.5 years ago. However, a forest of For Sale signs have gone up immediately after the election so the threat of a mansion tax definitely did have an impact around here.

Buying's dead money.

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Funny you should mention this. I rent in London and my flatmate and I pay a combined total of £2000 a month. An identical property to mine on the other side of the road went on the market last week and I did some rough calculations. Asking price £900,000. Assuming (and it's a big assumption) a 3% interest-only mortgage over a 25 year period, I'd be paying £2250 in interest payments alone before fees, tax, maintenance etc. Not that a bank would ever lend me that kind of sum! Incidentally, despite this being a supposedly white-hot part of the London property market, I doubt the asking price would have been any different 1.5 years ago. However, a forest of For Sale signs have gone up immediately after the election so the threat of a mansion tax definitely did have an impact around here.

Buying's dead money.

Or the estate agents didn't put the signs up despite the places already being up for sale.

Not all is what it seems when it comes to marketting

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I'm sure that we'll see some of this spin in the future...

Without property prices going up BTL for the amateur doesn't really make sense. It's certainly one of the greatest cons ever sold, although those who bought in the late 1990's must be rolling in it.

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Where we live rents are down and are now back at the same levels they were four years ago. Easy to see as there are many identical two bed flats, purchase prices are however up by around 40% over the four years and up by 20% in the last year.

House prices are a reflection of bank lending policies. Rents are a reflection of what people actually earn.

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House prices are a reflection of bank lending policies. Rents are a reflection of what people actually earn.

Maybe Cameron will run with the Libdems' loony idea of the state lending people money to rent .. After all, it's more for the benefit of the landlords than it is for the renters, something that the Tories love.

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I'm sure that we'll see some of this spin in the future...

Without property prices going up BTL for the amateur doesn't really make sense. It's certainly one of the greatest cons ever sold, although those who bought in the late 1990's must be rolling in it.

This i know people in both camps and you are spot on concerning both the one that bought in the 90`s sold off most in 0/5-0/7 everything that was left was paid off

The people that bought 0/3 onwards are looking for the exit ,the IO leverage up HPI gains game is coming close to the end game around my way prices have been flat or below 0/5-0/6 prices for the best part of a decade now

if there`s a cap on HB in july there could be a bit of panic setting in

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House prices are a reflection of bank lending policies. Rents are a reflection of what people actually earn.

What he said Ah-so San

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A house on our street just came on at offers over £675k - it's a 2 bed house, and it WILL sell. They rent for about £1500pm.

You do the math(s)

so worth 300k or there abouts.

50% nominal crash still to come, at least in asking prices.

Edited by TheCountOfNowhere

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so worth 300k or there abouts.

50% nominal crash still to come, at least in asking prices.

I went to look at a wreck around the corner during an estate agent open house day the other week. Offers over £550k. It needed a damp course and a complete rip-out. Better value than the £675k house though because it wouldn't cost you £125k+ to do I shouldn't think. So a flipping opportunity I guess (although I wouldn't like to risk it).

Got chatting to one of the other viewers - an 'investor'. I told him I rent around the corner for 1380pm, but he'd probably get about £1500pm looking at the current rental market, so it didn't really seen like it was worth £550k. He said he was buying for cash so it didn't matter, and then wondered off faster than I could say opportunity loss.

There's still plenty of stupid money swishing about out there. The house is now SSTC.

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I went to look at a wreck around the corner during an estate agent open house day the other week. Offers over £550k. It needed a damp course and a complete rip-out. Better value than the £675k house though because it wouldn't cost you £125k+ to do I shouldn't think. So a flipping opportunity I guess (although I wouldn't like to risk it).

Got chatting to one of the other viewers - an 'investor'. I told him I rent around the corner for 1380pm, but he'd probably get about £1500pm looking at the current rental market, so it didn't really seen like it was worth £550k. He said he was buying for cash so it didn't matter, and then wondered off faster than I could say opportunity loss.

There's still plenty of stupid money swishing about out there.

The house is now SSTC.

I'd was buying cash so it didn't matter.

What planet was he from?

Buy, crash, loose 50%. idiot.

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What he said Ah-so San

So not true.

http://www.cityam.com/213854/uk-house-prices-cost-buying-has-pushed-prices-10-cent-year-generation-rent

The price of renting a home in the UK has risen 10 per cent in the last 12 months – faster than the rate of growth for buyers.

New data from HomeLet shows that the average rental cost rose in the 12 months to March in 11 of the 12 UK regions, with only Wales being the only place where it's cheaper to rent now than it was this time last year.

The average cost of renting a property is now £902 a month in the UK as a whole and a whopping £1,427 in London, 10.2 per cent and 8.9 per cent more respectively than the average for the quarter to March 2014.
renatls-552fa52903a7f.png

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So not true.

I suspect that's much cruder statistically then the mix adjusted sales prices measured by nationwide etc. If it's a straight average of everything that got let on their database, then it's pretty meaningless. Could just imply that more high end properties are being rented out. Doesn't mean that the rental cost of a given size of property has changed.

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I suspect that's much cruder statistically then the mix adjusted sales prices measured by nationwide etc. If it's a straight average of everything that got let on their database, then it's pretty meaningless. Could just imply that more high end properties are being rented out. Doesn't mean that the rental cost of a given size of property has changed.

yep, all those "accidental" landlords trying to move on and keep their 4 bed detached on the rental market.

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Same. House just up the road from me sold for £1.4m and the buyer put it up for rent straight away - it has been 'to let' for 3 months for £3,000 all in (council tax etc). That is over £400k increase in price compared to identical houses in the road since 18 months ago. The rent is exactly the same as identical houses were 18 months ago.

Edited by repetitive bleats

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I suspect that's much cruder statistically then the mix adjusted sales prices measured by nationwide etc. If it's a straight average of everything that got let on their database, then it's pretty meaningless. Could just imply that more high end properties are being rented out. Doesn't mean that the rental cost of a given size of property has changed.

What he said.

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Where we live rents are down and are now back at the same levels they were four years ago. Easy to see as there are many identical two bed flats, purchase prices are however up by around 40% over the four years and up by 20% in the last year.

Out of curiosity, where do you live (in London)?

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I'd was buying cash so it didn't matter.

What planet was he from?

Buy, crash, loose 50%. idiot.

Even better as it wouldn't affect the banks so he would take any losses completely.

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Could affect btl sentiment however

Given the source, I kind of assumed that was its express purpose ;) (Not that the pwoperdee mad nutters need any encouragement.)

I went round the houses with slawek in August last year on the conflict between the serious government statistical work on rents and these VI toy indices last year on another thread.

From there, one of my favourite charts, taken from a Treasury report.

rents+track+earnings.png

Obviously quite out of date now, but does bring a sharpness of focus to the idea that people pay rent with earnings and hence rents can't materially accelerate away from earnings.

Edited by bland unsight

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