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Darwin Theory suggests that creatures evolved through 'best of breed' and survival of the fittest.

These days humans dont really have any problems worrying about being eaten by predators and running is confined to the gym. However, moving forward a few years to the current day, think about how many people are blissfully unaware how quickly their financial situations can change with the very real possibility of increasing interest rates.

I can't believe the number of people who simply dont understand the risks they have taken on. For the majority of first time buyers the Housing market is the only market that they have had any experience with, worse still they have only seen half a cycle.

As I've said in recent posts most FTB's have only a few things on their minds when buying property:

1) The housing market only goes up (thats what I've seen and thats what my parents tell me)

2) The media keep saying 'property prices up'

3) I've no idea how much 200k is in real terms but the bank is letting me borrow all the money so it must be ok and :

4) I can afford the monthly payments

so, back to my original point, when interest rates rise and some people cant afford their repayments I will have no sympathy.

I only hope that bankrupcy in some way limits the ability of stupid couples to procreate and leads to a modern equivalent of Darwin Theory.

Ok - its a little extreme but I dont loose sleep thinking about generations of cave men who were too slow to out-run hungry bears, the only difference, this being an intellectual challenge.

Do you think it should be the responsibility of the banks to explain more clearly what the risks are when borrowing this much money - or is their own stupid fault and they deserve what they get?

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Animals have three choices when placed in a difficult situation: adapt, move or die.

The UK housing situation is a difficult one at the moment. Which choice will you make?

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Animals have three choices when placed in a difficult situation: adapt, move or die.

The UK housing situation is a difficult one at the moment. Which choice will you make?

Adapt - you can't win all the time, sometimes you just gotta be a LOSER. :angry:

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I can't believe the number of people who simply dont understand the risks

They choose not to understand the risks.

Life is afterall 1 giant risk.

The chance of me being here is infintesimally small.

If for example 1 of the apes in my ancestral line had not made it or one of the thousands of Women in my line got pregnant the month before they did a different person would have been born who themselves may not have made it and so on. Think of the millions of unfertilised eggs in that ancestoral chain yet my egg in a chain of lucky eggs was chosen!

Now consider all the pre - ape organisms that also had to be born and survive for me to be here, a miracle, who needs religion!

So most people just get on with life. Mr Worries ....... worry.

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They choose not to understand the risks.

Life is afterall 1 giant risk.

The chance of me being here is infintesimally small.

If for example 1 of the apes in my ancestral line had not made it or one of the thousands of Women in my line got pregnant the month before they did a different person would have been born who themselves may not have made it and so on. Think of the millions of unfertilised eggs in that ancestoral chain yet my egg in a chain of lucky eggs was chosen!

Now consider all the pre - ape organisms that also had to be born and survive for me to be here, a miracle, who needs religion!

So most people just get on with life. Mr Worries ....... worry.

Yes, we really are quite insignificant in the scheme of things. All worrying about how much money we did or didnt make on property. Hello, we are living on a planet - spinning out there in the atmosphere. It could up go up in an instant. Think tsunami, think Katrina. Boo, hoo, I didn't make a trillion pounds buying and selling property at the right time. Poor old me, me, me.

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Think of the millions of unfertilised eggs in that ancestoral chain yet my egg in a chain of lucky eggs was chosen!

The eggs are all basically the same. This is known as "family resemblance."

Bears - The World is'nt full of fear, its your perception playing havoc. There's still time for you.......

DogBox: Have you considered working for a company called "Inside Track"?

:lol:

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Animals have three choices when placed in a difficult situation: adapt, move or die.

The UK housing situation is a difficult one at the moment. Which choice will you make?

Or Stand Still? Seems to me that’s what a lot of people on this site are doing.

I respectfully disagree with most of the comments on this forum. My view is, I think HP’s are going to continue rising. (Shock, Horror !?!)

I bought (Cheltenham) my house about a month before 9/11. I paid over £100k for it. I remember when 9/11 happened having this dreadful feeling I’d made a terrible mistake. All the press could talk about at the time, was how this disaster was going to cause a world-wide recession… It never did.

(Note: The Media don’t talk up house prices, as many people on this site think they do. They actually don’t care! They just love sensationalism, either way)

And fast forward a couple of yrs or so, I put my house on the market last month for £225k. I got 11 viewing in 2 wks, and 3 cash offers. (1 was full asking price) which I took. (Some of this rise was because I made a lot of improvements to the property)

Always been one to put my money where my mouth is, and am now splitting the profit into 2 mortgage deposits (1 for me + 1 buy-to-let) I figure they are going to keep going. Why? Partly because I don’t see interest rates going anywhere for a while, partly because I think housing demand is outstripping supply (where are all these immigrants going to live? – bet they don’t buy!) but mainly because I think the buy-to-let people are replacing the FTB’s. I heard about this guy from Bristol the other day. Just bought his 600th buy-to-let house! (He started at the last crash). He lets to students etc and generally comes in at the price the average FTB would come in at.

600 houses makes up for a lot of FTB’s. And I wonder how many there are like him? I read somewhere 90% of the wealth in this country in owned by 10% of the population. Probably far worse than that now?

Less a nation of shop keepers, and more a nation of landlords and tenants.

But I guess it depends on what kind of a Poker player you are?

Oh and, call me suspicious…. but I think some of the scare mongering, crash promoting post-ers on the site are in fact landlords!! After all, a reluctant house-buyer is a great tenant.

There ya go - Take me to bits people!!!

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Seems to me that only a select minority of the population should be allowed to reproduce .... ie the rich and beautiful :D

Cos if all our daddies were rich and our mummies were babes ..... the country would be under no over-population problem and "we" all would be loaded with super model wives :)

Or am I being too harsh ? :D

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I bought (Cheltenham) my house about a month before 9/11. I paid over £100k for it. I remember when 9/11 happened having this dreadful feeling I’d made a terrible mistake. All the press could talk about at the time, was how this disaster was going to cause a world-wide recession… It never did.

I will just select this one point of yours and "rip you to bits" on it.

Clear your mind... take a deep breath... and prepare to learn.

1). Imagine how powerful a propoganda tool 9/11 would have been, if it had resulted in a global recession.

2). A recession caused by torrorism may well lead to more terrorism.

3). Mr. Alan Greenspan, chair of the Federal Reserve at the time came up with an ingenius plan.

4). Mr. Greenspan used the base rate at the Federal Reserve to avert a global recession (the only tool capable of the task). He reduced interest rates to 1%! That is an astoundingly low rate.

5). Five years later people have stopped talking/worrying about 9/11.

6). It is time for people to repay all that money they borrowed to cheer themselves up following 9/11.

To summarise:

Current house prices are a side effect of Alan Greenspan lending the whole world cheap money.

What basically happened after 9/11 is Greenspan said look heres a fifty, go and get yourself something nice.

The current high housing price is a side effect of cheap borrowing. Cheap borrowing that was intended to cheer up US consumers and avert a recession.

Well the recession has been averted long enough. A recession now would not be blamed on terrorism.

Get ready for a recession.

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Cheekmonkey, you made £115,000 very easily. But you must accept that you can now lose an equivalent amount just as easily.

There's a time to buy and a time not to buy. Most people here think now is a time not to buy. They are also taking a risk. It is also a risk which could be worth £115,000 or more in terms of lifetime wealth.

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Or Stand Still? Seems to me that’s what a lot of people on this site are doing.

I respectfully disagree with most of the comments on this forum. My view is, I think HP’s are going to continue rising. (Shock, Horror !?!)

I bought (Cheltenham) my house about a month before 9/11. I paid over £100k for it. I remember when 9/11 happened having this dreadful feeling I’d made a terrible mistake. All the press could talk about at the time, was how this disaster was going to cause a world-wide recession… It never did.

(Note: The Media don’t talk up house prices, as many people on this site think they do. They actually don’t care! They just love sensationalism, either way)

And fast forward a couple of yrs or so, I put my house on the market last month for £225k. I got 11 viewing in 2 wks, and 3 cash offers. (1 was full asking price) which I took. (Some of this rise was because I made a lot of improvements to the property)

Always been one to put my money where my mouth is, and am now splitting the profit into 2 mortgage deposits (1 for me + 1 buy-to-let) I figure they are going to keep going. Why? Partly because I don’t see interest rates going anywhere for a while, partly because I think housing demand is outstripping supply (where are all these immigrants going to live? – bet they don’t buy!) but mainly because I think the buy-to-let people are replacing the FTB’s. I heard about this guy from Bristol the other day. Just bought his 600th buy-to-let house! (He started at the last crash). He lets to students etc and generally comes in at the price the average FTB would come in at.

600 houses makes up for a lot of FTB’s. And I wonder how many there are like him? I read somewhere 90% of the wealth in this country in owned by 10% of the population. Probably far worse than that now?

Less a nation of shop keepers, and more a nation of landlords and tenants.

But I guess it depends on what kind of a Poker player you are?

Oh and, call me suspicious…. but I think some of the scare mongering, crash promoting post-ers on the site are in fact landlords!! After all, a reluctant house-buyer is a great tenant.

There ya go - Take me to bits people!!!

I know 4 eastern europeans who are stuggling to find work, this time last year getting a job was alot easier, if things dont improve there going home...

Edited by moosetea

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Or Stand Still? Seems to me that’s what a lot of people on this site are doing.

I respectfully disagree with most of the comments on this forum. My view is, I think HP’s are going to continue rising. (Shock, Horror !?!)

I bought (Cheltenham) my house about a month before 9/11. I paid over £100k for it. I remember when 9/11 happened having this dreadful feeling I’d made a terrible mistake. All the press could talk about at the time, was how this disaster was going to cause a world-wide recession… It never did.

(Note: The Media don’t talk up house prices, as many people on this site think they do. They actually don’t care! They just love sensationalism, either way)

And fast forward a couple of yrs or so, I put my house on the market last month for £225k. I got 11 viewing in 2 wks, and 3 cash offers. (1 was full asking price) which I took. (Some of this rise was because I made a lot of improvements to the property)

Always been one to put my money where my mouth is, and am now splitting the profit into 2 mortgage deposits (1 for me + 1 buy-to-let) I figure they are going to keep going. Why? Partly because I don’t see interest rates going anywhere for a while, partly because I think housing demand is outstripping supply (where are all these immigrants going to live? – bet they don’t buy!) but mainly because I think the buy-to-let people are replacing the FTB’s. I heard about this guy from Bristol the other day. Just bought his 600th buy-to-let house! (He started at the last crash). He lets to students etc and generally comes in at the price the average FTB would come in at.

600 houses makes up for a lot of FTB’s. And I wonder how many there are like him? I read somewhere 90% of the wealth in this country in owned by 10% of the population. Probably far worse than that now?

Less a nation of shop keepers, and more a nation of landlords and tenants.

But I guess it depends on what kind of a Poker player you are?

Oh and, call me suspicious…. but I think some of the scare mongering, crash promoting post-ers on the site are in fact landlords!! After all, a reluctant house-buyer is a great tenant.

There ya go - Take me to bits people!!!

Ummm - nice first post, NOT. Welcome to HPC. What are you doing here????

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Or Stand Still? Seems to me that’s what a lot of people on this site are doing.

I heard about this guy from Bristol the other day. Just bought his 600th buy-to-let house! (He started at the last crash). He lets to students etc and generally comes in at the price the average FTB would come in at.

People here generally don't think that property is a bad investment. It's just a bad investment to make NOW.

The successful landlord started when property was cheap in real terms. He will probably be fine in the event of a crash.

You are starting in the worst possible position. You will be roasted alive. :rolleyes:

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Always been one to put my money where my mouth is, and am now splitting the profit into 2 mortgage deposits (1 for me + 1 buy-to-let) I figure they are going to keep going. Why? Partly because I don’t see interest rates going anywhere for a while, partly because I think housing demand is outstripping supply (where are all these immigrants going to live? – bet they don’t buy!) but mainly because I think the buy-to-let people are replacing the FTB’s. I heard about this guy from Bristol the other day. Just bought his 600th buy-to-let house! (He started at the last crash). He lets to students etc and generally comes in at the price the average FTB would come in at.

- housing demand is really no different now than it was 10 years ago, even with all the eastern europeans. Last I heard they were all living in the same room anyway.

oh and by the way your right - house prices will continue to rise forever - go ahead you'll make a mint !!!

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Ummm - nice first post, NOT. Welcome to HPC. What are you doing here????

Trying to see it from all sides before making signing my BTL contract(s). What was I thinking, eh?

If I BTL on a 220k house with £75k deposit and pay approx. £1,000pm back over 20 yrs. Then if rent ends up being £700-£800pm and I make a loss of a couple of hundred quid a month. I couldn't care less? That's nothing if I end up with a house at the end of it. Better that than a pension. And the reason there are so many BTLers out there in the first place is because the Stocks/Shares are pretty rubbish. Companies are untrustworthy and Pensions go bust!

Ultimately, there's not alot else you can do with money... There's not alot else for average people to turn. So they turn to land.

That £75k deposit is monopoly money for me. I don't mean this arrogantly. I'm certainly not wealthy. Infact, I don't even get to see it really! My point is just that it was unexpectedly made on the back of a boom in a couple of short yrs. I’m 32 yrs old if it all goes to pot, I'm only back where I was a couple of yrs ago. So again, I'm not all that bothered really.

I don’t rely on property to make me rich. I agree, that would be a mistake. (I rely on my business to do that.)

I would definitely advocate doing what I did though. That is, buy a wreck do it up and flog it. It aint as difficult as it sounds and there’s a lot of them out there if you know where to look. E.g.(http://www.buildstore.co.uk/findingland/) It reduces your risk if the worst happens..? That's what I'm doing with the rest of the cash on the other house anyway.

Anyway, here's a post from Motley Fool. Probably abit bullish for you guys, but not that bad. Clever conclusion though.

http://boards.fool.co.uk/Message.asp?mid=9...recommendations

All the best with your speculating anyway.

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Trying to see it from all sides before making signing my BTL contract(s). What was I thinking, eh?

If I BTL on a 220k house with £75k deposit and pay approx. £1,000pm back over 20 yrs. Then if rent ends up being £700-£800pm and I make a loss of a couple of hundred quid a month. I couldn't care less? That's nothing if I end up with a house at the end of it. Better that than a pension. And the reason there are so many BTLers out there in the first place is because the Stocks/Shares are pretty rubbish. Companies are untrustworthy and Pensions go bust!

Ultimately, there's not alot else you can do with money... There's not alot else for average people to turn. So they turn to land.

That £75k deposit is monopoly money for me. I don't mean this arrogantly. I'm certainly not wealthy. Infact, I don't even get to see it really! My point is just that it was unexpectedly made on the back of a boom in a couple of short yrs. I’m 32 yrs old if it all goes to pot, I'm only back where I was a couple of yrs ago. So again, I'm not all that bothered really.

I don’t rely on property to make me rich. I agree, that would be a mistake. (I rely on my business to do that.)

I would definitely advocate doing what I did though. That is, buy a wreck do it up and flog it. It aint as difficult as it sounds and there’s a lot of them out there if you know where to look. E.g.(http://www.buildstore.co.uk/findingland/) It reduces your risk if the worst happens..? That's what I'm doing with the rest of the cash on the other house anyway.

Anyway, here's a post from Motley Fool. Probably abit bullish for you guys, but not that bad. Clever conclusion though.

http://boards.fool.co.uk/Message.asp?mid=9...recommendations

All the best with your speculating anyway.

You are probably right, it is still a good time to buy. Yep, definitely. We are not all FTB's here. Many of us also made money out of the boom, but don't feel the need to gloat. It is this mentality that makes things very dangerous. I actually do own property (shock, horror). Anyway, I hope you are right, for your sake. I'm afraid you are preaching to the converted.

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Animals have three choices when placed in a difficult situation: adapt, move or die.

The UK housing situation is a difficult one at the moment. Which choice will you make?

Well, i dont believe in adapting. Unless your getting an extention on your house :)

That's the problem, no-one can move rungs of ladder too far apart :)

So looks like the housing markets' about to die R.I.P

:lol::lol::lol:

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The eggs are all basically the same. This is known as "family resemblance."

Well... actually... hmmm... no. There are an almost infintesimal number of changes that can occur, hence my sister is tall and I am short, even more shocking, I have brothers. I mean what is that about :blink: They've got dangly bit that I don't :o . Each of whom have significant differences in looks personality capabilites and interest. There is also a further existential question about timing. If you were born a month before, likely hood is that you would be doing different things this month, and hence would not neccessarily meet the same girl, know the same people, be run over by the same car etc...

Seems to me that only a select minority of the population should be allowed to reproduce .... ie the rich and beautiful :D

Cos if all our daddies were rich and our mummies were babes ..... the country would be under no over-population problem and "we" all would be loaded with super model wives :)

Or am I being too harsh ? :D

I take it you think that you would survive under a "rich and beautiful" model of eugenic engineering <_< Are you really rich and beautiful? What are you doing here? I mean, not too many really rich people on this site (but all the chicks look like elle mcpherson, and all the boys look like brad pitt or antonio banderas)

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If I BTL on a 220k house with £75k deposit and pay approx. £1,000pm back over 20 yrs. Then if rent ends up being £700-£800pm and I make a loss of a couple of hundred quid a month. I couldn't care less? That's nothing if I end up with a house at the end of it. Better that than a pension. And the reason there are so many BTLers out there in the first place is because the Stocks/Shares are pretty rubbish. Companies are untrustworthy and Pensions go bust!

Hmmm.

What if interest rates jump to 9% on the back of credit tightening.

Your repayments double to £2000pcm. That would leave you a loss of £1200 - £1300pcm say this lasts 5 to 6 years. Thats £72,000 - £93,600 straight out of your **** pocket.

Over a 20 year period such interest rates are very, very likely. So if you do have an additional £80,000 lying around, that would be consumed into repaying this debt.

If you did not you would lose everything and be bankrupt.

If everything goes to plan you stand to make (220K - 75K) - (200*12*20) = £97,000 profit

Having risked £123,000

Thats rubbish!

if I put £75,000 in a bank account for 20 years at 5% it would fetch me 75,000*1.05^20 = £198,997

Plus my £200 quid a month = £1200 pa

so

£1200 * 1.05% ^ 20years = £3184

£1200 * 1.05 ^ 19 = 3032

£1200 * 1.05 ^ 18 = 2887

£1200 * 1.05 ^ 17 = 2750

£1200 * 1.05 ^ 16 = 2619

£1200 * 1.05 ^ 15 = 2495

£1200 * 1.05 ^ 14 = 2375

£1200 * 1.05 ^ 13 = 2263

£1200 * 1.05 ^ 12 = 2155

£1200 * 1.05 ^ 11 = 2052

£1200 * 1.05 ^ 10 = 1955

£1200 * 1.05 ^ 9 = 1862

£1200 * 1.05 ^ 8 = 1773

£1200 * 1.05 ^ 7 = 1689

£1200 * 1.05 ^ 6 = 1608

£1200 * 1.05 ^ 5 = 1531

£1200 * 1.05 ^ 4 = 1459

£1200 * 1.05 ^ 3 = 1389

£1200 * 1.05 ^ 2 = 1323

£1200 * 1.05 ^ 1 = 1260

Total from £200pcm deposits = £41,661

Giving you a total of 198,997 + 41,661 = £240,658

I suppose I all boils down to what you know about the economy and interest rates.

I believe you stand to lose a fortune. Watch the Fed, and try not to let it get to you too much.

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Trying to see it from all sides before making signing my BTL contract(s). What was I thinking, eh?

If I BTL on a 220k house with £75k deposit and pay approx. £1,000pm back over 20 yrs. Then if rent ends up being £700-£800pm and I make a loss of a couple of hundred quid a month. I couldn't care less? That's nothing if I end up with a house at the end of it. Better that than a pension. And the reason there are so many BTLers out there in the first place is because the Stocks/Shares are pretty rubbish. Companies are untrustworthy and Pensions go bust!

Ultimately, there's not alot else you can do with money... There's not alot else for average people to turn. So they turn to land.

Do you seriously think that the stock market is "rubbish" for a long term bet? What are you basing this on? If you did a bit of research on stocks and shares, you would find that someone who has invested in a few large established companies over the last 25 years has done pretty well, with pretty low risk. If not, what are investment banks and other large institutions in the stock market for? I also think you would be taking far less risk than you are by putting the money on a single property, at what looks like the height of the boom.

What have you got against pensions? Everyone needs an income when they stop working so getting it from an annuity sounds fine by me. Employers will contribute a matching amount, and the government gives me huge tax relief on contributions.

frugalista

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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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