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malk

At What Point Would You Buy?

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We talk (well I mostly lurk) about examples that show just how ridiculous things have become but at what point would you consider prices reasonable? London and the South East are probably moot at this point but elsewhere, is there a particular metric that would satisfy any of us sufficiently to bite the bullet and buy?

Perhaps a multiple of average household income for the "average" (i.e. not just the cheapest) house in a given area? Perhaps something more personal, say a multiple of your own household income for a place you'd be happy with?

Even then would you be happy to go ahead or does the fear of the crash causing prices to drop well below reasonable value for a period mean that even then you'd hang fire?

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entirely depends on the house.

a 2 bed flat, would want extreme value so if the value dropped to zero, I would not care

a great detached house with a fantastic garden, if I could afford to buy without overextension, would not care if value dropped by half after I bought.

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I'm renting a 2 bedroom terraced house in SE England, it would cost £550k to buy now. I'd offer £130k to buy it.

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I looked at it from a purely utilitarian point of view. I figured the missus and I had maybe 40 years of lifespan left - and that home owning would bring additional costs as well as benefits so I came up with a max of 20x current yearly rent for a forever house. In the end, we managed it for a bit less money.

For a flat, I would expect to pay no more than 5 times yearly rent due to it likely being leasehold and having a service charge.

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Still trying to save up for a deposit but for me I won't be comfortable buying again until freehold 2 bedroomed houses in my area go for less than £100k. The decent-ish ones are about £140k+ at the moment in my home city.

I think I will be waiting a loooong time. :rolleyes:

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I don't think that prices will fall, there is too much vi in it all. What I think may happen is that we will get massive inflation as seen in the 70s which will mean wages will rise. Hopefully it should balance at 3x wage for a starter home. Someone who understands economic fundamentals will be along to say I'm completely wrong

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last year i brought my house for same price as 2005 with all furniture in my home town.

i do feel very lucky at moment as gone up silly amount in year. I dont intend to sell it so does not matter the value as its my home

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entirely depends on the house.

a 2 bed flat, would want extreme value so if the value dropped to zero, I would not care

a great detached house with a fantastic garden, if I could afford to buy without overextension, would not care if value dropped by half after I bought.

In my case it'd be somewhere between an indefinite and forever house but the nagging thought of a big drop in "value" after purchase, even if I could comfortably make the repayments, irks.

I looked at it from a purely utilitarian point of view. I figured the missus and I had maybe 40 years of lifespan left - and that home owning would bring additional costs as well as benefits so I came up with a max of 20x current yearly rent for a forever house. In the end, we managed it for a bit less money.

For a flat, I would expect to pay no more than 5 times yearly rent due to it likely being leasehold and having a service charge.

That's an interesting way of looking at it, one I hadn't considered. It'll be getting some consideration now so, cheers!

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