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Charles_Darke

How Many Years Would You Wait?

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Let's assume that we know with absolute certainty that house prices will grow at 3%pa for the next X years at the end of which they will drop by 35%. For those looking to buy, how big would X need to be before you would buy before the drop?

Edited by Charles_Darke

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Let's assume that we know with absolute certainty that house prices will grow at 3%pa for the next X years at the end of which they will drop by 35%. For those looking to buy, how big would X need to be before you would buy today?

Daft question since if X = 10 years, a 35 % drop would stil be higher than now. Typical of peeps on here not thinking things through

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When you can afford to buy basically - that's what governs it.

And it depends on what actually happens. If we hit recession, may people's options will be limited due to affordability. If we have a very slow drawn out reduction based on very slow increase in IRs and higher inflation, then prices will have continued support from people gradually being able to afford new property.

If bin chobby lets off nuke or a meteor hits us, then its a new paradigm altogether. Hmm... let's not think about that too much.

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Daft question since if X = 10 years, a 35 % drop would stil be higher than now. Typical of peeps on here not thinking things through

Maybe you should try thinking things through and do your maths again! (Not that your calculations being right would invalidate the question in any event) :rolleyes:

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Daft question since if X = 10 years, a 35 % drop would stil be higher than now. Typical of peeps on here not thinking things through

You forgot that the 35% drop is on the inflated price, not the original one.

If the house price rises by 3% a year, then after 10 years, it will be worth 134.3916379344121920495% of it's current price. If the price then drops by 35%, then it will then be worth 87.3535% of its original price. Quite a bit less.

To get the price coming back down to 100% of the current price will take 15 years.

In response to the original question, the answer would depend on the relative costs of owning versus renting. Given that house prices are known for the X years, it becomes a very unrealistic scenario, but provided that rental costs are known and similarly predictable, and the full costs of owning are considered then given sufficent numbers the break even point should be calculable. Whether the break-even point is when I'd buy or not is a much more difficult question than it appears.

Billy Shears

Edited by BillyShears

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Let's assume that we know with absolute certainty that house prices will grow at 3%pa for the next X years at the end of which they will drop by 35%. For those looking to buy, how big would X need to be before you would buy before the drop?

Is that 3% above inflation? If not, then buying simply cannot be a wise investment.

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IMO for this website to fulfill it URL name were are going to need a major event (envionmental or political) to cause a large change in prices

0.25% swing in interest rates just isn't going to cut it given the current housing supply/demand....

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Let's assume that we know with absolute certainty that house prices will grow at 3%pa for the next X years at the end of which they will drop by 35%. For those looking to buy, how big would X need to be before you would buy before the drop?

yaaaaaaaaaaaaaawwwwwwwn

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Let's assume that we know with absolute certainty that house prices will grow at 3%pa for the next X years at the end of which they will drop by 35%. For those looking to buy, how big would X need to be before you would buy before the drop?

Boy, this is a stupid question. Duh, I would buy now, and then one day before X and the 35% drop sell. If I knew with absolute certainty. Well, assuming that X * 3% is enough to cover transaction costs....

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why buy when its such a hassle.

it would be nice to buy one, but not at all other costs.

id rather rent in luxury than buy in poverty.

9x salary is pointless. unless you want to enslave the rest of your life for nothing more than sentiment.

houses can kiss my hairy ass.

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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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