Perfect Strangers Buy Together To Get On Ladder

[Bucephalus]

http://www.timesonline.co.uk/newspaper/0,,...2306472,00.html

Co-buyers united

Finding a ‘mortgage buddy’ on the internet is the latest trend among first-time buyers desperate to get on the property ladder. Helen Davies logs on to search for one of her own

The ad I’ve written goes like this: “WLTM solvent male or female, an interest in property essential, preferably house-trained. GSOH a bonus. Minimum commitment two years.”

I am single, 29, and I’m not looking for love (well, not in this instance). What I am is looking for someone to buy a home with. In 21st-century Britain, where house prices continue to head skyward, people trying to step on the first rung of the property ladder are becoming more and more inventive about how to do it — or should that be desperate? Welcome to the world of co-buying websites, where wannabe first-time buyers post their personal details online to try and find a “mortgage buddy”.

etc

I find this incredible. It has the potential to inflate the bubble a bit further if it takes off, but must surely be evidence of unsustainability at the FTB level. Making the most important financial decision in your life with some stranger you met off the internet, I mean next people will be turning to the net to find someone to marry

[enworb]

http://www.timesonline.co.uk/newspaper/0,,...2306472,00.html

Co-buyers united

Finding a ‘mortgage buddy’ on the internet is the latest trend among first-time buyers desperate to get on the property ladder. Helen Davies logs on to search for one of her own

The ad I’ve written goes like this: “WLTM solvent male or female, an interest in property essential, preferably house-trained. GSOH a bonus. Minimum commitment two years.”

I am single, 29, and I’m not looking for love (well, not in this instance). What I am is looking for someone to buy a home with. In 21st-century Britain, where house prices continue to head skyward, people trying to step on the first rung of the property ladder are becoming more and more inventive about how to do it — or should that be desperate? Welcome to the world of co-buying websites, where wannabe first-time buyers post their personal details online to try and find a “mortgage buddy”.

etc

I find this incredible. It has the potential to inflate the bubble a bit further if it takes off, but must surely be evidence of unsustainability at the FTB level. Making the most important financial decision in your life with some stranger you met off the internet, I mean next people will be turning to the net to find someone to marry

It doesn't surprise me. What does though is that to share with a complete stranger would surely mean buying a 2 bed (minimum)nproperty.

If they set their sights to a one bed or studio they wouldn't need to buy with a complete stranger

Better to have equity in a studio/1 bed than share equity with a complete stranger on a 2 bed...IMO

[dnd]

This is an example of how a market economy adapts to changes with new products and services (it's a business deal really)- and how the inflation bubble can keep expanding indefinatly...

[iLegallyBlonde]

This won't take off anybody who's had 4 years of sharing at uni and a year of sharing after whilst you scrape together a deposit for your own flat knows sharing with like minded friends can be sheer hell.

I see the murder rates going through the roof if this is what it comes to.

[get real]

Sledgehead had a good story which is worth a revisit, well on topic here, a reminder of the massive risk buying with strangers could entail

http://www.housepricecrash.co.uk/forum/ind...mp;#entry236909

[papyrus]

This is an example of how a market economy adapts to changes with new products and services (it's a business deal really)- and how the inflation bubble can keep expanding indefinatly...

not without wage growth it can't !

[newaccount99]

This is an example of how a market economy adapts to changes with new products and services (it's a business deal really)- and how the inflation bubble can keep expanding indefinatly...

And what a marvelous array of "products and services" we have seen:

1) Buying with a stranger.

2) Getting parents to buy/provide equity

3) Buying BTL oop North or Bulgaria with a view to sell and buy place to live later.

4) Self-certified mortgages

5) Interest only mortgages with no repayment vechicle identified.

6) Multiple income mortgages.

7) Cash-back or deposit paid on over inflated City living new build.

I do disagree that "the inflation bubble can keep expanding indefinately..." there really comes a point in all these things when people will say "wait a moment....this is a crock of $hite.....I can rent, get what I want, and pay a lot less for it"

[enworb]

This won't take off anybody who's had 4 years of sharing at uni and a year of sharing after whilst you scrape together a deposit for your own flat knows sharing with like minded friends can be sheer hell.

I see the murder rates going through the roof if this is what it comes to.

And a new website, www.friendsununited.co.uk

Agree, sharing with friends is bad enough. You only have to watch big brother...... that said there are pairs (same sex) in there that get on fairly well

[get real]

And what a marvelous array of "products and services" we have seen:

1) Buying with a stranger.

2) Getting parents to buy/provide equity

3) Buying BTL oop North or Bulgaria with a view to sell and buy place to live later.

4) Self-certified mortgages

5) Interest only mortgages with no repayment vechicle identified.

6) Multiple income mortgages.

7) Cash-back or deposit paid on over inflated City living new build.

I do disagree that "the inflation bubble can keep expanding indefinately..." there really comes a point in all these things when people will say "wait a moment....this is a crock of $hite.....I can rent, get what I want, and pay a lot less for it"

Still to come . . .

Flexishare from Morgan Stanley

Negative Amortization Loans - "fix your own monthly repayment" terms and repay as little as you like while the negative balance is added to the principal loan - already available in the US

Edited August 13, 2006 by get real

[dnd]

not without wage growth it can't !

Huh? - multiple people buying together is a mutiple % increase in income - there is your 'wage inflation'

Expect to see other 'products' designed to cope with static wage inflation and every increasing price inflation...

[newaccount99]

Huh? - multiple people buying together is a mutiple % increase in income - there is your 'wage inflation'

Expect to see other 'products' designed to cope with static wage inflation and every increasing price inflation...

But surely the great pull of "home ownership" is having somewhere that is your own....after years of sharing with others or feeling unsettled in rented.

If you've got to share with a stranger, who you may fall out with, you're are doubling up on those un-settling life changes like job change, location change, marriage etc all of which could necessitate a house move.

The reason people are co-owning is purely on the basis of short term capital appreciation, so they can then go their seperate ways.....it's self-fullfilling....but when the opportunities for capital growth fade so will shared ownership.

Edited August 13, 2006 by BTLOptingOut

[dnd]

But surely the great pull of "home ownership" is having somewhere that is your own....after years of sharing with others or feeling unsettled in rented.

Things change...

If you've got to share with a stranger, who you may fall out with, you're are doubling up on those un-settling life changes like job change, location change, marriage etc all of which could necessitate a house move.

New products and services designed to cope with problems associated with shared ownership will be created eg legislation, legal/councelling services

Edited August 13, 2006 by dnd

[newaccount99]

Things change...

New products and services designed to cope with problems associated with shared ownership will be created eg legislation, legal/councelling services

Oh are you suggesting OO communes with every broom cupboard occupied with a bed.....meanwhile those sensible enough to rent get to live in decent accom but miss out on "capital appreciation"?

IMHO I reckon dual-purchases are a flash in the pan.....soon there will be some very affordable CLNB (City Living New Build) appartments available for all, purchased from disillusioned newbie LL's.

[papyrus]

Huh? - multiple people buying together is a mutiple % increase in income - there is your 'wage inflation'

Expect to see other 'products' designed to cope with static wage inflation and every increasing price inflation...

and any remaining value is further eroded... ...until there is no value and pop!

even the masses will figure it out in the end... eventually.

i've heard that argument before - if you couldn't afford a box of tulips you were

encouraged to buy half a box.

once again - history is forgotten, every generation knows better than the

one before and prices always go up.. etc. etc. etc. .... zzZZZZZ

[dnd]

Oh are you suggesting OO communes with every broom cupboard occupied with a bed.....meanwhile those sensible enough to rent get to live in decent accom but miss out on "capital appreciation"?

IMHO I reckon dual-purchases are a flash in the pan.....soon there will be some very affordable CLNB (City Living New Build) appartments available for all, purchased from disillusioned newbie LL's.

I'm no bull - I'm looking at it as it is - an adapting market economy - these are options that may be open to those stupid enough to buy

Dual purchases are just one method of ownership - others will follow...

and any remaining value is further eroded... ...until there is no value and pop!

even the masses will figure it out in the end... eventually.

Yep, inflation, IMO, isn't fully understood by the masses - the media, if they choose to, will play a large part in this

IIRC Merv himself said that the BOE fear public awareness of inflation more than inflation itself

....which makes sense as inflation has gone up dramatically over the past few years with nobody batting an eyelid and people unconsiously borrowing to bridge the gap between rising prices and their static wages - if they became aware of what they were doing - they'd stop

Edited August 13, 2006 by dnd

[FirstRungNow]

from Helen Adams of www.FirstRungNow.com

Our research shows that buying a place with someone else is not a first choice but often the least favoured option. And buying with a stranger can sometimes offer up other risks - but so can buying with someone with whom you have a past - there may even be more likelihood of conflict with a brother, sister, girlfriend than with a stranger. To reduce risks, measures can be put in place to protect your investment. You have to approach it correctly.

We at FirstRungNow recommend that it is approached in a business like way and a co-habitation agreement - no matter how simple or complex should always be drawn up - you never know when circumstances will change.

Shared ownership is often an ideal as you can live alone - in theory though you may need to sub-let to cover costs, but let's face it the waiting lists adn eligibility criteria cam let you down.

Joint ownership, along with shared ownership, getting parental help or taking out one of the new mortgages for first time buyers should be considered sensibly - it may or may not be the best option. Sometimes you have to combine options or think outside the box with regard to how you live in the accomodation.

Buying with a stranger needs to be weighed up against all the ogther options - including staying out and saving in earnest.

Despite houspricecrash's certainty ( for 3 years now) that property prices will crash, there are those who believe that until recently on the global platform, UK house prices have been undervalued and that today's prices reflect a global market value. Also those who believe that starting to pay off a mortgage and invest in one's own shelter is a good use of money in preparation for parenthood and retirement.

[Jason]

Despite houspricecrash's certainty ( for 3 years now) that property prices will crash, there are those who believe that until recently on the global platform, UK house prices have been undervalued and that today's prices reflect a global market value. Also those who believe that starting to pay off a mortgage and invest in one's own shelter is a good use of money in preparation for parenthood and retirement.

Well if it wasn't for certain websites like yours (can't buy on your own? Then tie yourself in with a stranger) maybe it would have crashed. Could you image the problems your website will have caused when prices inevitably fall?

Oh, and anyone who is thinking of co-buying, they should rent together first. Then they will know if they will get on or not.

[CrashedOutAndBurned]

http://www.timesonline.co.uk/newspaper/0,,...2306472,00.html

Co-buyers united

Finding a ‘mortgage buddy’ on the internet

Sounds vaguely reminiscent of the ugly modern term 'f*ck buddy', only rather more sordid.

[FirstRungNow]

Well if it wasn't for certain websites like yours (can't buy on your own? Then tie yourself in with a stranger) maybe it would have crashed. Could you image the problems your website will have caused when prices inevitably fall?

Oh, and anyone who is thinking of co-buying, they should rent together first. Then they will know if they will get on or not.

[Zzzzzzzzzzzzzzzzzzzzzzzzzz]

Sharing a house with my chav brother for 2 weeks, who is living in SE Europe> Bulgaria and Romania (both of which which seem to be chavvy generally if my brother is to be believed - e.g. mentioned a Spanish flamenco themed topless bar where people drink pina colada cocktails in half pint mugs- v popular with the locals, including families, according to my brother), is hell. I'm now determined not to visit in the other direction!!!!!!!!!!!!!!!!!!!!!!!!!!!

Edited August 13, 2006 by gruffydd

[Warwickshire Lad]

from Helen Adams of www.FirstRungNow.com

My god, are you still around, pedalling your vested interest BS to all and sundry ?

Mortgage lenders and vested interests know that they can only keep this market going now by pumping out ever more irresponsible lending to FTBs.

I genuinely feel very sorry for all FTBs who have been sucked in by the kind of propaganda that is put out by you and people like you.

[Zzzzzzzzzzzzzzzzzzzzzzzzzz]

Despite houspricecrash's certainty ( for 3 years now) that property prices will crash, there are those who believe that until recently on the global platform, UK house prices have been undervalued and that today's prices reflect a global market value. Also those who believe that starting to pay off a mortgage and invest in one's own shelter is a good use of money in preparation for parenthood and retirement.

[Jason]

Despite houspricecrash's certainty ( for 3 years now) that property prices will crash, there are those who believe that until recently on the global platform, UK house prices have been undervalued and that today's prices reflect a global market value. Also those who believe that starting to pay off a mortgage and invest in one's own shelter is a good use of money in preparation for parenthood and retirement.

I don't know how anyone can take her seriously, i'll be nice as I don't know here personally, but she clearly has no idea about markets. If UK house prices were previously undervalued, why is renting so cheap in comparison? She talks about global markets, but isn't prices now falling in major markets (US, Aus) so how does our prices reflect global market value?

Looking round her website, you can see it is capitalising on the deperation of those priced out. The website is the result of the housing bubble, and all the methods possible are employed to keep it all going. It won't work, it will just delay the inevitable and it will destroy peoples lives in the process.

Ok, I accept this website has predicted falls for a while. But what's the point in predicting falls when falls are already apparant? Surely you want a warning. The tactic you use in dismissing us as being wrong, shows you don't want to enter any debate, infact I don't think you are capable of debate. So Helen what will happen to the market?

If you look back to last August 05 (which was after a year of heavy stagnation), the bears on here said how the rate cut was the wrong thing and inflation will rocket. Look now, we have been proved right in how rates should have never been reduced. We also argued how rates will need to rise, of which they have done. I don't see you warning FTBs about the risks of higher interest rates.

[FirstRungNow]

If you have looked at www.FirstRungNow.com recently you will see that we lay out the facts as we see them so those who want to own the roof over their own head can see the options.

We don't force people to come to our web-site!

Buying witha stranger is one option - a whole BBC series was made about it - with little or no mention of the fallbacks or co-habitation agreements which we see as rather irresponsible. Do you give the BBC such a bad critique? They can probably influence the market far more than FirstRungNow could - even if it wanted to!

A sign of the times is a fact that 3 companies have started up joint ownership introduction services in the last few months - they obviously realise that co-ownership and co-financing is the future for FTBs. It's not just FirstRungNow that recognises this!

Carrying on renting is fine for those of you who can afford the rent and to also top up your pensions so that in retirement you might be able to afford to pay for rent or for a mortgage on your pensions but for ordinary folk that isn't an option. Not everyone is in such a comfortable position.

For your information, at FirstRungNow we consistently warn against overborrowing, we flag that property values can go down as well as up and we don't arrogantly claim to know what's going to happen in the future.

What I mean about global markets is that demand for property and accomodation in the UK doesn't just come from our home-grown population it is sought from overseas too. Various aspects about the UK and it's property market attracts overseas investors and overseas demand - hence the high prices. We realise that debts are high in the UK but equity wealth is also very high.

Some people predict that if there is a cash it will be because of the Japanese economy or China or the US going to war - something really significant on a global scale.

[Jason]

Do you give the BBC such a bad critique?

The BBC gets alot of bad critique, and many emails complaining about certain issues.

It's funny how you stereotype us on how we are wrong about house prices. Yet you object when we do the same to you.

I don't think lenders relaxing their criteria, and bringing new products to the market are aimed to help FTBs. They are to help themselves, they are trying to keep the bubble growing. Just like in the 90s.

Funny how you mention the debt to equity ratio, a meaningless statistic INHO. What happens if the debt part rises? The equity would also rise as people are now borrowing more for the same thing. During credit tightening this 'equity' will get attacked from both ends.

Edited August 13, 2006 by Jason