Pete95 Posted December 25, 2005 Share Posted December 25, 2005 A few mates of mine, all FTB's 25/26 thinking of buying properties next year. They all seem to think theres no way prices are going to crash, and seem happy enough to pay 120k for a 2bed flat or terraced house (Bristol area) Ive tried to explain that the current prices are unsustainable, however they all seem to think prices will continue to rise above inflation.... 2 friends I know bought in 2003 - one got a 2bed terrace for about 80k, now worth 120k - the other bought a 3bed detached off plan for 200k and his company have just bought it off him for 300k as part of a relocation package... nice 100k profit in under 2years... Problem is I would really like to own my own house, and could afford to buy something at 120k - but having looked I could probably get an alright 2bed flat for 85k. Putting 30k down, this would mean I could pay the rest off on a 5year mortgage and I have to admit Im almost tempted.... Are other people starting to think the same way, or am I just being stupid here?.. Quote Link to comment Share on other sites More sharing options...
izzy Posted December 25, 2005 Share Posted December 25, 2005 What's the urgency? Do you really need to buy, can't you rent? If you really think prices are going to rise, then buy. If prices are going to 'plateau', then there's no rush. Quote Link to comment Share on other sites More sharing options...
Unexpected Posted December 25, 2005 Share Posted December 25, 2005 Cant you see that things have really started to turn now? Sounds like you can easily afford to buy, but why not buy a bigger and better place in a couple of years time without all the hassle and worry of buying now. Coming back on here as a bull while watching your place depreciate wont be much fun you know. Quote Link to comment Share on other sites More sharing options...
crash co-ordinator Posted December 25, 2005 Share Posted December 25, 2005 Sounds about right to me Pete. Long gone are the days of saving up a 5K deposit it's more like 30K now. The property ladder stinks and the sooner it becomes more fair the better. Quote Link to comment Share on other sites More sharing options...
Badlad1967 Posted December 25, 2005 Share Posted December 25, 2005 A few mates of mine, all FTB's 25/26 thinking of buying properties next year. They all seem to think theres no way prices are going to crash, and seem happy enough to pay 120k for a 2bed flat or terraced house (Bristol area) ........... Are other people starting to think the same way, or am I just being stupid here?.. But what do *you* think Pete? Why do they think prices won't crash? Ooops - just noticed how old you are! (no disrespect meant, mate) I was in my (very early!!!!) 20's when the last crash came. Same headlines as we are seeing now. Same spin. Same billhooks.... You and your mates have loved your adult life during a time when "property always goes up..." BELIEVE ME - it's not always like that! Prices are slipping now - I would sit back and wait and see what happens. Even the worst spin is saying that prices are rising lower than the amount you could get in a decent deposit account, so what's the hurry? To test the waters - why don't you throw in a couple of offers and see what reaction you get? That would show you how the market is like in your area... One more thing matey. Your friends who bought in 2003 bought just before the peak. I feel they were extremely fortunate to get the price they wanted. The truth is that in most cases, nothing is selling for anywhere near what people think their properties are worth.... And no - you're not being stupid because you're looking before you leap! Quote Link to comment Share on other sites More sharing options...
iLegallyBlonde Posted December 25, 2005 Share Posted December 25, 2005 2 friends I know bought in 2003 - one got a 2bed terrace for about 80k, now worth 120k - the other bought a 3bed detached off plan for 200k and his company have just bought it off him for 300k as part of a relocation package... nice 100k profit in under 2years... A house is only worth what somebody else is willing to pay. In the 2nd example your friend was worth more to the company than the house so they paid the extra to relocate him. Who exactly are the other friends going to sell the 2 bed terrace to ? Would you buy it for £120k ??? Quote Link to comment Share on other sites More sharing options...
Pete95 Posted December 25, 2005 Author Share Posted December 25, 2005 Prices are slipping now - I would sit back and wait and see what happens. Even the worst spin is saying that prices are rising lower than the amount you could get in a decent deposit account, so what's the hurry? This is a good point, the 30k desposit would make me approx £1250 per year in interest after tax, so maybe waiting another year might be sensible, and I'd have a bigger deposit then too. On the other hand if I move out of home and rent (which is likely) then thats approx 4-5k per year in rent + council tax... Its a tough one really, but in 2 years of being a regular on this site Im feeling more unsure about a big crash now than at any other point previously. Quote Link to comment Share on other sites More sharing options...
Goat Posted December 25, 2005 Share Posted December 25, 2005 Anybody who's thinking of buying, just read the Economist articles from June 2005. They are available through the home page of this site. If the Economist is predicting a crash then so am I. Quote Link to comment Share on other sites More sharing options...
Spikey Posted December 25, 2005 Share Posted December 25, 2005 Anybody who's thinking of buying, just read the Economist articles from June 2005. They are available through the home page of this site. If the Economist is predicting a crash then so am I. Nothing against the thought of HPC but be aware the economist has lowered(raised!) the decline to only -5% Quote Link to comment Share on other sites More sharing options...
FreeFall Posted December 26, 2005 Share Posted December 26, 2005 Question I'm asking myself is that if you can pay off your mortgage in 5 years on a property you actually want to live in then why not go for it. Money isn't everything after all. Problem where I am is that it would take me 25 years to pay off a mortgage on a place I wouldn't be seen dead in. Time to carry on renting for me. Quote Link to comment Share on other sites More sharing options...
Converted Lurker Posted December 26, 2005 Share Posted December 26, 2005 A few mates of mine, all FTB's 25/26 thinking of buying properties next year. They all seem to think theres no way prices are going to crash, and seem happy enough to pay 120k for a 2bed flat or terraced house (Bristol area) Ive tried to explain that the current prices are unsustainable, however they all seem to think prices will continue to rise above inflation.... 2 friends I know bought in 2003 - one got a 2bed terrace for about 80k, now worth 120k - the other bought a 3bed detached off plan for 200k and his company have just bought it off him for 300k as part of a relocation package... nice 100k profit in under 2years... Problem is I would really like to own my own house, and could afford to buy something at 120k - but having looked I could probably get an alright 2bed flat for 85k. Putting 30k down, this would mean I could pay the rest off on a 5year mortgage and I have to admit Im almost tempted.... Are other people starting to think the same way, or am I just being stupid here?.. My best advice is not to be emotional over the subject, prices are not rising, will not rise for the forseable, therefore you can bide your time. Find/negotiate yourself a bargain? Excellent. If not, relax Good example locally. 2 bed terraces have been selling for approx. 120-135K. Recently one came up for auction guide price 95K. No bids. An ftb known to me offered 90K after the auction when the reserve of 100K was revealed, offer rejected. He`s not putting in a higher offer. Just goes to show how clued up ftbs can and should be. I really believe that the second mouse will get the cheese, the wall of money that has gone into btl is well and truly stuck..fo the long term If I were you I`d consider offering on plenty at 20% below asking in the new year, I`d be searching out the desperate before the bmv brigade beat you to it and I would have no manners whatsoever kicking people in the nuts if they have any amount of equity in their property..unleash hell Quote Link to comment Share on other sites More sharing options...
Nem Posted December 26, 2005 Share Posted December 26, 2005 (edited) I was rather lucky back in 2001 and picked up my 1st property for a whopping 21.5k valued at 30k as the seller (a friend of the family) wanted shut quick. My plan was to make a quick 10k as the place needed some work to get it upto scratch, then move onto a better place in a nicer area. Fast foward to today, with an income of just over 30k I'm close to being priced out of even buying my own bloody house, if I was to purchase the place today as same property in the same area is going for 95-135k. Are these houses actually worth this?? Are they b0ll0cks....... This is the state of the market which is more or less vastly overpriced crap, only the very foolish would purchase now or possibly those under considerable partner/peer pressure. In the next 3 months, I will be putting my money where my mouth is and will sell my house to rent. I am convinced that prices will drop by upto 30% across the UK and in certain area's such as Liverpool, probably more like 40% Obviously, if you don't mind throwing money away in the sense of you could purchase an 85k flat and pay it off in 5 years thats all well and good. But I wouldn't be suprised if you find the place won't be worth what you paid for it, for at least another 8-10 years. Good investment? Yes at some point you'll no doubt get more than you paid, but with some research and patience you could buy 2 properties for the same price if you wait a little longer. Good luck in whatever you decide to do. Edited December 26, 2005 by Nem Quote Link to comment Share on other sites More sharing options...
right_freds_dead Posted December 26, 2005 Share Posted December 26, 2005 depends if you beleive in fairytales....... [cue emerson, lake and palmer] ming ming ming ming ming ming ming. -ming ming. minga ming ming. ming ming ming ming.\ They said there'll be a low at christmas They said there'll be property worth But instead prices just kept on rising A roll of tears from the landlords mirth and I remember one priced out morning A winters light from a one bar fire And the peal of a doorbell and that sharp rocky smell And their yards full of tinbeds and tyres ming ming ming ming ming ming ming. -ming ming. minga ming ming. ming ming ming ming.\ They sold me a dream of owning They sold me a sleepless night And they told me a fairy story 'till i believed the price was right And i believed in brave new labour And i jumped may 97 with excited eyes 'till i woke with a yawn in the first light of millenium dawn And i saw him and through his disguise ming ming ming ming ming ming ming. -ming ming. minga ming ming. ming ming ming ming.\ I wish you a crash for christmas I wish you a short new year All anguish pain and priced out sadness Leave your savings alone and let your credit be clear They said there'll be a lot at christmas They said there'll be real worth Hallelujah noel edmunds be it heaven or hell The debt you all get you all deserve Quote Link to comment Share on other sites More sharing options...
MRMX9 Posted December 28, 2005 Share Posted December 28, 2005 I am about to move into a new build fully furnished 1 bed flat in East London which I will be renting from the landlord for £825 per month. The flat cost the owner £225,000 to purchase (the Olympics bubble effect!). Assuming I bought the same flat with a £15k deposit this would leave me with a £1,300 per month mortgage (excluding stamp duty, repairs, furniture, legal & survey fees) i.e. almost £500 extra a month to live in the same place. Why would any first time buyer want to buy in the current market - wouldn't you rather have a life? Quote Link to comment Share on other sites More sharing options...
Goat Posted December 28, 2005 Share Posted December 28, 2005 I am about to move into a new build fully furnished 1 bed flat in East London which I will be renting from the landlord for £825 per month. The flat cost the owner £225,000 to purchase (the Olympics bubble effect!). Assuming I bought the same flat with a £15k deposit this would leave me with a £1,300 per month mortgage (excluding stamp duty, repairs, furniture, legal & survey fees) i.e. almost £500 extra a month to live in the same place. Why would any first time buyer want to buy in the current market - wouldn't you rather have a life? Another sub 5% gross yield accepted by the landlord in the hope of capital gains outweighing the loss. Once these amateur BTLers realise that they aren't going to see the gains that they have budgeted for there is going to be panic! Quote Link to comment Share on other sites More sharing options...
doogie Posted December 28, 2005 Share Posted December 28, 2005 (excluding stamp duty, repairs, furniture, legal & survey fees)...and service charges/ground rent Quote Link to comment Share on other sites More sharing options...
quangolicious Posted December 28, 2005 Share Posted December 28, 2005 Another sub 5% gross yield accepted by the landlord in the hope of capital gains outweighing the loss. Once these amateur BTLers realise that they aren't going to see the gains that they have budgeted for there is going to be panic! Next place that I rent I'll be checking when the landlord bought the property and how much he paid for it. I don't want to be told after four months that he can't afford to keep it and that he's going to sell! If all tennants thought like this it would make it even harder for new BTLers, but I suppose they won't. Quote Link to comment Share on other sites More sharing options...
Pete95 Posted December 31, 2005 Author Share Posted December 31, 2005 Update: Went for a meal with a few mates last night, of the 6 of us - 4 are planning on buying next year Al - already bought in 2003 - now renting that place out, and has bought in Dublin (300k euro 40YEAR mortgage ) - he plans on buying more property asap to rent out.... not bothering with a pension, going for property instead. Andy - looking at buying a newish waterfront 1bed flat (120-140k) to rent out Dave - buying a house, 120-160k to live in, maybe rent a room Ed - a few of his RAF mates have BTL's - hes thinking of joining the party in 2006.. None of them expect to see the values climb much, but nobody sees prices falling. If everyone is thinking like this then surely prices are very unlikely to fall - confidence must be quite high, so EA's will be ramping up the asking prices next year surely?... Quote Link to comment Share on other sites More sharing options...
underpressuretobuy Posted December 31, 2005 Share Posted December 31, 2005 None of them expect to see the values climb much, but nobody sees prices falling. If everyone is thinking like this then surely prices are very unlikely to fall Although confidence in a market has an effect you should not underestimate one of the major reasons that ftbs are staying out of the property market - they can't afford to buy at these prices. No amount of confidence is going to change that. You seem to be looking at what people think about the market and assuming that people's thoughts and feelings set the market value of the house but this is to ignore the wider UK economy. The economy and consequently the property market is going to be affected by consumer spending within the economy - much reduced now that the UK population have more debt per head than they have ever had before (by a long way). There are so many things that affect how much money someone is prepared to spend on a property, confidence that the market value will stay the same or rise is just one of them. Look at the bigger picture. Quote Link to comment Share on other sites More sharing options...
paradox Posted December 31, 2005 Share Posted December 31, 2005 Al is a fool, unless he earns a fortune Andy, puzzling. He is looking to buy a flat to rent out a flat and continue renting himself? Also a fool in todays market, though might have worked in the past. Dave, good luck to him - sounds like he has hid head screwed on. Ed - sounds dodgy to me. Mid 20s in the RAF and already own BTLs!!! But anyway - do these people actually exist? Quote Link to comment Share on other sites More sharing options...
Zzzzzzzzzzzzzzzzzzzzzzzzzz Posted December 31, 2005 Share Posted December 31, 2005 (edited) Dear Pete, You're not related to Bill Gates from Singing Pig, who also seems to know FTBs who are all looking to buy similar properties in the Bristol area? YOU'VE BEEN EXPOSED ME THINKS. Stop being so disingenuous! "2 friends I know bought in 2003 - one got a 2bed terrace for about 80k, now worth 120k - the other bought a 3bed detached off plan for 200k and his company have just bought it off him for 300k as part of a relocation package... nice 100k profit in under 2years..." - Pete 95, HPC. "Two friends I know bought in 2003 - one got a 2 bedroom terrace for about 80k, now worth 120k - the other bought a 3 bedroom detached off plan for 200k and his company have just bought it off him for 300k as part of a relocation package... nice 100k profit in under 2 years..." - Bill Gates, Singing Pig. Here's the full Bill Gates post from Singing Pig - "A few friends of mine, all FTB's, are thinking of buying properties next year. They all seem to think there is no way prices are going to crash, and seem happy enough to pay 120k for a 2 bedroom flat or terraced house (Bristol area) I have mentioned that there are some property commentators who are bearish about property prices and think that house prices will crash but my friends seem to think prices will continue to rise above inflation.... Two friends I know bought in 2003 - one got a 2 bedroom terrace for about 80k, now worth 120k - the other bought a 3 bedroom detached off plan for 200k and his company have just bought it off him for 300k as part of a relocation package... nice 100k profit in under 2 years... Many other FTBs are starting to think the same way and are fed up of waiting for a crash that is never going to happen and are desperate to get onto the property ladder before property prices double in the run-up to the London Olympics in 2012. The continuing housing boom is good news because it is preventing the STRs from getting back onto the property ladder and it is forcing them to continue paying dead money in rent that is helping to pay off their landlord's mortgage whilst they continue to see the value of their STR fund money being eroded away by inflation. The STRs want a property crash to occur so that they can buy a property at a low price so that they can then sell for a much higher price and make a substantial profit in the next property boom."- Bill Gates - Singing Pig Mmmmmmmmmmmmmmmmmm G Edited December 31, 2005 by gruffydd Quote Link to comment Share on other sites More sharing options...
paradox Posted December 31, 2005 Share Posted December 31, 2005 Exactly gruffydd The ficticious people sound so preposterous. Just where have all the real 'young professionals' gone? Quote Link to comment Share on other sites More sharing options...
iLegallyBlonde Posted December 31, 2005 Share Posted December 31, 2005 I'm only 5 years old than you but most of our friends are mid to late thirties We have Karl and Beth - in Harpenden - just sold to rent, have seen their house price drop 10% and got out whilst the going is good. Debbie and Dave - live in the Bristol area - she is a teacher, he is a lorry driver, they have one child and one on the way, renting, haven't a hope of buying at the moment so are happily waiting. Ade and Gill - earn a fortune in High Wycombe - bought in 2003, just keeping their heads above water. Fingers crossed for them. John and Rachel - Just about to buy a 2 bedroomed new build in Doncaster, possibly the unluckiest man alive and now about to make the biggest mistake of his life imo, have tried to subtley point this out but what can you do. We are renting with our three children and are about to buy a dog, life doesn't begin when you sign up for a mortgage in fact for many it ends tbh. Quote Link to comment Share on other sites More sharing options...
johnnyw Posted December 31, 2005 Share Posted December 31, 2005 The STRs want a property crash to occur so that they can buy a property at a low price so that they can then sell for a much higher price and make a substantial profit in the next property boom."- Bill Gates - Singing Pig Mmmmmmmmmmmmmmmmmm G Average property prices would be £300000, changing hands at 15x average earnings. Now I think this may be a bit optamistic! But no doubt there will be some wit on Singing Pig who can get you one at 50% of market value, making you a fortune overnight. Quote Link to comment Share on other sites More sharing options...
Zzzzzzzzzzzzzzzzzzzzzzzzzz Posted December 31, 2005 Share Posted December 31, 2005 C'mon Pete / Bill Gates - own up - ! Quote Link to comment Share on other sites More sharing options...
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