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Harry

I've Been A Way For A While

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I have just returned to this site for the first time in about 9 months, and I'm quite surprised to see how much the mood has changed. Last September my wife and I moved out of London to Farnborough, Hampshire. I sold a flat in 2004 and we had been renting for a couple of years before taking the decision to move further out. Luckily for us, we found a lovely detached house that we're now very happy in. We never could have afforded the same house in London.

We had a large slice of equity to invest in the house, but also took out a sizeable, but affordable, mortgage. But while the purchase was progressing, I was a regular visitor to this site (among others) and, I have to say, there were times that I was scared rigid by what I read here(!) We persisted, however, and once the sale had gone through, I thought 'What's done is done' and decided to stop reading this site. We had made our decision.

In the meantime, I have become more relaxed about our decision to buy last year. The house has increased in value by 8% to 9% during the last 9 months, and I am sure we would now be kicking ourselves if we had backed out of the purchase. But that is not to say I am completely confident that the health of house market in this country is guaranteed. I think there might well be some pain ahead once the full extent of the interest rates rises (incl those still to come) are felt, but I suppose I am fairly confident that if there is a reduction in prices during the next year or two, the reduction is unlikely to exceed the increase that we have seen since we bought.

That said, I am surprised at the extent to which the housing bears that were crawling all over this site for the last few years now appear to have gone AWOL. Has sentiment really turned that sharply?

And one final question. The financial press is full of stories regarding the poor state of the US housing market, but I haven't been able to find any figures relating to the fall in prices. Does anyone have a feel for how far prices in the US have fallen from their peak?

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I have just returned to this site for the first time in about 9 months, and I'm quite surprised to see how much the mood has changed. Last September my wife and I moved out of London to Farnborough, Hampshire. I sold a flat in 2004 and we had been renting for a couple of years before taking the decision to move further out. Luckily for us, we found a lovely detached house that we're now very happy in. We never could have afforded the same house in London.

We had a large slice of equity to invest in the house, but also took out a sizeable, but affordable, mortgage. But while the purchase was progressing, I was a regular visitor to this site (among others) and, I have to say, there were times that I was scared rigid by what I read here(!) We persisted, however, and once the sale had gone through, I thought 'What's done is done' and decided to stop reading this site. We had made our decision.

In the meantime, I have become more relaxed about our decision to buy last year. The house has increased in value by 8% to 9% during the last 9 months, and I am sure we would now be kicking ourselves if we had backed out of the purchase. But that is not to say I am completely confident that the health of house market in this country is guaranteed. I think there might well be some pain ahead once the full extent of the interest rates rises (incl those still to come) are felt, but I suppose I am fairly confident that if there is a reduction in prices during the next year or two, the reduction is unlikely to exceed the increase that we have seen since we bought.

That said, I am surprised at the extent to which the housing bears that were crawling all over this site for the last few years now appear to have gone AWOL. Has sentiment really turned that sharply?

And one final question. The financial press is full of stories regarding the poor state of the US housing market, but I haven't been able to find any figures relating to the fall in prices. Does anyone have a feel for how far prices in the US have fallen from their peak?

If you think its only going to drop 8-9% hold on to your hat cuase belive me it going to be a lot more than that

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If you think its only going to drop 8-9% hold on to your hat cuase belive me it going to be a lot more than that

I find it amazing how many people come on this board and say they are glad they bought as they have accrued 10% in the last few months/years so any correction would unlikely effect them.

HOUSES HAVE BECOME A MAINSTREAM INVESTMENTS WITH LAX LENDING SO MUST BE TREATED WITH CAUTIONS AS ANY INVESTMENT SHOULD BE.

How can people happily accept that an asset (leveraged) of theirs has gone up 9% in a short period of time on top of tripling over a very short period of time and not accept that something worse than a few months equity might be wiped out is beyond me!

At the same time it explains why we are in the perilous situation we are in . People are in the winners curse phase and this is something strongly reinforced between generations. If I knew now I could match my parents investments over the past 25 years with shares, property and Land, I would be able to use my current savings so I would never need to work. Do I think this will be possible, absolutely not.

This is not an attack on the OP because he is happy with his decision and this is something that can be rationalized with how long you intend to stay in the property and your ability to match the mortgage (currently my brother and best friends are buying and it suites their circumstances). My issue is with the view that “I am safe” because I have recently received astronomical growth in my asset so any setback would have limited effect.

Time will indeed tell.

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The financial press is full of stories regarding the poor state of the US housing market, but I haven't been able to find any figures relating to the fall in prices. Does anyone have a feel for how far prices in the US have fallen from their peak?

'Townhomes a steal in Fort Myers':

http://www.winknews.com/news/local/7896352.html

Greg Toher was outraged when he heard the prices some of the homes were going for. Walking out of the auction room, he told us, "$145,000! Unbelievable! We paid $300,000! They just got rid of at least four for $145,000!" He says he closed on his three bedroom San Simeon townhome in December, "You've got to be kidding me, that's not fair."

New buyers may be getting a steal, but current San Simeon homeowners, like Greg, tell WINK News they feel like they've been ripped off. Tara Gionpalo said, "I feel really mad, really sad, hurt."

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Gains made in a few years or months can and could be lost just as quickly. Now long term say five or ten year gains are probably locked in even in the most severe correction.

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Gains made in a few years or months can and could be lost just as quickly. Now long term say five or ten year gains are probably locked in even in the most severe correction.

put it this way the highest drop ive seen in us home prices was 65%.

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