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Buffer Bear

Desperate Friend

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I'm adviced out!

Below is an email sent from a friend who is desperate to buy. We have been in an ongoing debate on HP and each time he has 'seen the light', he sees some spin from the VI's and is again derailed.

"I am not waiting ten to fifteen years to buy!!! Did you watch that programme the other night about the ten best places to invest in property? London was considered a special case especially Elephant and Castle. The presenters stated that independent research indicated that house prices in the capital could rise by 37% over the next five years!!! You can imagine how I felt about that. the interesting thing they said that in all the areas mentioned the projections were for substantial increases in prices over five years. Now where do I go? The Maudsley? (they offer psychiatric interventions.)

I have had enough doomsday scenarios, I will begin my search for property after I return from the Big Apple with the hope of buying before the year is out!!!"

For TTRTR, Spring Bounce et al, don't tell him to stop wasting his money on holidays because it was free! It's the company he mixes with :) .

Edited by Buffer Bear

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I'm adviced out!

Below is an email sent from a friend who is desperate to buy. We have been in an ongoing debate on HP and each time he has 'seen the light', he sees some spin from the VI's and is again derailed.

"I am not waiting ten to fifteen years to buy!!! Did you watch that programme the other night about the ten best places to invest in property? London was considered a special case especially Elephant and Castle. The presenters stated that independent research indicated that house prices in the capital could rise by 37% over the next five years!!! You can imagine how I felt about that. the interesting thing they said that in all the areas mentioned the projections were for substantial increases in prices over five years. Now where do I go? The Maudsley? (they offer psychiatric interventions.)

I have had enough doomsday scenarios, I will begin my search for property after I return from the Big Apple with the hope of buying before the year is out!!!"

For TTRTR, Spring Bounce et al, don't tell him to stop wasting his money on holidays because it was free! It's the company he mixes with :) .

Leave him to it. He knows where you stand on it and you have both no doubt discussed it to great depths previously. He was obviously a sheep all along.

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Guest Bart of Darkness

You've given him what you feel is the best advice you can, in the end we are all responsible for our own actions (in theory, responsibility seems to be a dirty word these days).

If he's going to buy regardless, so be it. What you can do to help him is to make sure he doesn't get taken for a ride. Are you a good negotiator (or is he?). Make sure he doesn't pay full price for a new build, or doesn't offer too much on an existing property.

You have at least made sure that he was aware of both sides of the arguement, a perspective which many other buyers will have been denied. If he still wants to buy regardless, there's really nothing you can do. You might feel bad about the decision he's made, he's a friend after all and you don't want to see him in the financial mire, but I think you've done as much as could be expected.

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the Blackpool Gazette Property supplement tonight has the story as its lead

" a growing number of parents are pooling mortgages with their children to buy them property...."

the best bit

" first time buyer Emma Brickwood, 22, was struggling to get on the property ladder until her mother Susan came to the rescue and offerred to jointly purchase a 2 bed apartment. Susan Brickwood entered into a joint mortgage on the 235,000 pound apartment ...."

" Emma said ...Her investment means i can relax in the knowledge that i am on the way up the property ladder..."

MUPPETS

235,000 for a 2 bed apartment in the fylde ?? WTF ???

bring on the interest rate increases please

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"I am not waiting ten to fifteen years to buy!!! Did you watch that programme the other night about the ten best places to invest in property? London was considered a special case especially Elephant and Castle.

:rolleyes::lol:

Hrm, where do you start?

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Would he take offence when you bought it off him for 2/3rds of what he paid for it???

If not, ask him to get a conservatory and a loft extension immediately :)

TB

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I'm adviced out!

Below is an email sent from a friend who is desperate to buy. We have been in an ongoing debate on HP and each time he has 'seen the light', he sees some spin from the VI's and is again derailed.

"I am not waiting ten to fifteen years to buy!!! Did you watch that programme the other night about the ten best places to invest in property? London was considered a special case especially Elephant and Castle. The presenters stated that independent research indicated that house prices in the capital could rise by 37% over the next five years!!! You can imagine how I felt about that. the interesting thing they said that in all the areas mentioned the projections were for substantial increases in prices over five years. Now where do I go? The Maudsley? (they offer psychiatric interventions.)

I have had enough doomsday scenarios, I will begin my search for property after I return from the Big Apple with the hope of buying before the year is out!!!"

For TTRTR, Spring Bounce et al, don't tell him to stop wasting his money on holidays because it was free! It's the company he mixes with :) .

Not every house price purchase is bad for HPC, precisely the opposite. A house bought for less than the previous market price (as mentioned above) establishes a new lower level for prices in the area. It's through smallish decreases here and there that prices go down.

So, school your friend in all the tactics used to bump prices up. Teach him to use nethouseprices. Go to some auctions and research recent selling prices at them. Make sure he's aware of EA tactics such as "another party is interested/is about to make an offer". If he gets 10K off previous market value then that's a useful step in the HPC direction.

Billy Shears

the Blackpool Gazette Property supplement tonight has the story as its lead

" a growing number of parents are pooling mortgages with their children to buy them property...."

the best bit

" first time buyer Emma Brickwood, 22, was struggling to get on the property ladder until her mother Susan came to the rescue and offerred to jointly purchase a 2 bed apartment. Susan Brickwood entered into a joint mortgage on the 235,000 pound apartment ...."

" Emma said ...Her investment means i can relax in the knowledge that i am on the way up the property ladder..."

MUPPETS

235,000 for a 2 bed apartment in the fylde ?? WTF ???

bring on the interest rate increases please

Any hints as to how they expect she will move "up the ladder"? Any figures or estimates? Any expectations of much higher salary in the future?

Billy Shears

Edited by BillyShears

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I'm adviced out!

Below is an email sent from a friend who is desperate to buy. We have been in an ongoing debate on HP and each time he has 'seen the light', he sees some spin from the VI's and is again derailed.

"I am not waiting ten to fifteen years to buy!!! .........................................................I have had enough doomsday scenarios, I will begin my search for property after I return from the Big Apple with the hope of buying before the year is out!!!"

He isn't asking for advice, he's informing you of his intent to buy. Indeed I suspect he may be chiding you to some degree, because he may consider your take on the market has stopped him from acting earlier. It's a human failing that people will always seek to blame others for their own inaction or mistakes. :rolleyes:

My advice to you, [assuming I'm still not on "ignore" ;)] would be to inform him, although your position regards the market has not changed, you wish him well in his search for property. Whatever you do, don't tell him he is making a mistake, unless you want to risk loosing a friend.

Edited by Catch22

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Any hints as to how they expect she will move "up the ladder"? Any figures or estimates? Any expectations of much higher salary in the future?

You don't really expect them to have thought about anything beyond 'getting on the first rung', do you? It's precisely because people rush to buy without thinking that we're in this state.

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My Tuppence worth.

His comment regarding "10-15 years" betrays his emotionally wired state. Either deflate him with cold rationality (sit down and do the figures with him, using his own details) or let him get on with it.

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My advice to you, [assuming I'm still not on "ignore" ;)] would be to inform him, although your position regards the market has not changed, you wish him well in his search for property.

Hello Catch,

No, you're not on ignore anymore :) .

Thanks everyone for your feedback.

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The figures released today are scaring the sheeple, yet when I show him evidence of reductions he ignores me. This is his latest response.

I am going to look at a flat in Vauxhall on Saturday near the tube. Ex-local well maintained block. It is a second floor 1 bedroom. On the market for £169 something. This is my ideal location but I will see what it is like!!!

I no longer feel able to offer an opinion. He is lost and will lose a substantial deposit.

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Not every house price purchase is bad for HPC, precisely the opposite. A house bought for less than the previous market price (as mentioned above) establishes a new lower level for prices in the area. It's through smallish decreases here and there that prices go down.

So, school your friend in all the tactics used to bump prices up. Teach him to use nethouseprices. Go to some auctions and research recent selling prices at them. Make sure he's aware of EA tactics such as "another party is interested/is about to make an offer". If he gets 10K off previous market value then that's a useful step in the HPC direction.

I agree with everything you say but one of the biggest problems at the moment is people continuing to buy at asking price in anticipation of continuing house price rises.

I think your advice, to get this chap to make a low offer, will likely fall on deaf ears.

This chap's comments clearly indicates that he resents the advice given so far.

I've experienced this before (and not just in relation to house prices), a friend asks your opinion but what they really want is encouragement and they can get very stroppy if you are honest and tell them they are making a mistake.

This guy doubtless has other friends / family who are giving him the encouragement he wants, he will be listening to them because they are giving him the support he needs / wants rather than encouraging him to ask questions / take the harder path.

Edited by underpressuretobuy

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I am going to look at a flat in Vauxhall on Saturday near the tube. Ex-local well maintained block. It is a second floor 1 bedroom. On the market for £169 something. This is my ideal location but I will see what it is like!!!

Does he know these blocks slam private tenants with huge bills for central government council induced renovation and 'improvements'. "This block needs a new roof, we've decided, that's £20k each please."

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Does he know these blocks slam private tenants with huge bills for central government council induced renovation and 'improvements'. "This block needs a new roof, we've decided, that's £20k each please."

Absolutely true - one I looked at about a year ago was charged 200 quid for the LA to paint ONE bin-house door (and they painted the thing in the rain - just slapped some gloss over the top of the old stuff). Took about 25 mins apparently. Now that's what I call a good hourly rate....

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The figures released today are scaring the sheeple, yet when I show him evidence of reductions he ignores me. This is his latest response.

I am going to look at a flat in Vauxhall on Saturday near the tube. Ex-local well maintained block. It is a second floor 1 bedroom. On the market for £169 something. This is my ideal location but I will see what it is like!!!

I no longer feel able to offer an opinion. He is lost and will lose a substantial deposit.

I can sympathise. I've just had to give up trying to give advice to my sister and her boyfriend. They are set on buying now and I've been told 'to just be happy for them'. He is 35, she is 29 and he still has around £15K debt from re-training course :blink:

They are looking at taking on approximately £190K mortgage and believe that Windmill Hill in Bristol is good value and 'has potential because it's cheaper'. I pointed out that prices are still about 4 X higher than they were in only 1998 so I didn't think this represented good value!

Oh well, people will only see what they want to see. The majority in the UK including most people I know simply don't think about this kind of stuff. That's why we are in a speculative bubble and that's why it will go pop.

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I'm not sure morally we should be applying pressure to friends and loved ones on this type of issue. You could/should give an opinion but really how can you offer more, no-one has the ability to see the future.

However, how would you feel in 3 years if you are wrong. Investments and finance are best kept to a professional level, that way no relationships get damaged when and if it goes wrong.

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I have had enough doomsday scenarios, I will begin my search for property after I return from the Big Apple with the hope of buying before the year is out!!!"

Sounds pretty determined. A few of my friends have the same ideas and there was no changing their minds. In the end, the only advice they took was to get a fixed rate mortgage for as long as possible to protect against the inevitable rate hikes. Best advice I could give without overstepping the mark and ruining the friendship. If he’s insistent on buying then maybe he should do the same (while there are still some long term fixed rate mortgages left!)

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The figures released today are scaring the sheeple, yet when I show him evidence of reductions he ignores me. This is his latest response.

I am going to look at a flat in Vauxhall on Saturday near the tube. Ex-local well maintained block. It is a second floor 1 bedroom. On the market for £169 something. This is my ideal location but I will see what it is like!!!

I no longer feel able to offer an opinion. He is lost and will lose a substantial deposit.

I think I know those places. Tell him to go and look at it at night, on his own. That should be all the advice you need to give him.

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Does he know these blocks slam private tenants with huge bills for central government council induced renovation and 'improvements'. "This block needs a new roof, we've decided, that's £20k each please."

And don't think this is some extreme example, a guy I sat next to at work was in that exact scenario, they re did the roof and each tenant got a bill for £23k.

He and the other tenants got together to fight it and there was nothing they could really do about it, he met plenty of other people in similar situations, so even having a bills of £50K +

Edited by gilf

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I'm not sure morally we should be applying pressure to friends and loved ones on this type of issue. You could/should give an opinion but really how can you offer more, no-one has the ability to see the future.

However, how would you feel in 3 years if you are wrong. Investments and finance are best kept to a professional level, that way no relationships get damaged when and if it goes wrong.

This is excellent advice in general - but there may be some advice you can give him other than just "don't buy". If he is determined to buy, he might do better than ex-LA in Vauxhall...

I would agree with those warning about big ex-LA maintenance bills. They can be crippling in blocks in particular. There is one safeguard which is that his solicitor can check with the LA what works are planned. But given the potential outlay on maintenance it may actually make more sense to get something a bit more expensive (or wait and save). Ex-LA blocks are also expecially hard to sell if there is a downturn, even if they are reasonable ones.

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If this person is buying a house to live in then why shouldnt they buy?

Are you seriously recomending they gamble on a market crash? In the last 100 years there has probably only been a few years where it was financially beneficial to not buy a house and wait. But this seems like such a huge gamble to me, what if prices continue to rise at 10% a year?. The odds are probably stacked in favor of stagnation or rises.

Edited by zag2me

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  • 341 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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