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What Kind Of Discount Would You Want To See To Buy This Place?


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Nothing wrong with that, just it's an investment property so a markup is invovled and they may have cut corners elsewhere or done DIY work.

That's a good point, I hadn't thought of that, thanks. I have to say that it did need a bit of decorating and looked tired in some places.

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Not in London no. As an example my friend graduated the same time as me in 1997. The housing market was a lot more sane then. He managed to get a graduate job and bought a two bedroom maisonettei n Tooting, a scary part of London.

He and is wife are now both middle managers, I am guessing earning well over 40K each, (and both had pre-bubble purchased maisonettes to sell) but they can still could still only afford a two bedroom semi in an average part of North East London.

Even my parents when they first bought in London (maybe in the 1960s?) could only afford to buy a maisonette at first, with help from parents. They were on average wages then working in a bank.

It does seem to be a totally different situation, especially comapred to up north where I live

The only bit of London I know is Cricklewood/Willesden 'cos of an ex - just for perspective, what would that area be classed as e.g. average, poor etc.

EDIT typo

Edited by newdman
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Pleasant, nondescript and like a hundred others in greater London.

Hmmm to be honest I always had it down as one of the better parts of London. Some people here have mentioned council estates in the area which I didn't know about but I don't have the street by street knowledge of a cabbie. :D

I have only explored parts of it, so I might be wrong about the area, (I am more of a North of the River Londoner).

I think that so much of London is terrible. There are so many run down grotty areas. I considered this one of the much better areas of London myself. Obviously it isn't Chelsea or anything like that, but pretty good for Greater London.

To give an idea on prices in London at the moment, I live in a crappy part of North West London (Colindale) and tiny two bed terraced houses in this area are still being listed at around 250K. I am not saying for one minute they are worth that, but I wanted to give an idea of where the market was before the bubble burst.

There are even some so called luxury apartments here (just one bedroom) that are, rather ridiculously being listed at 200K. Madness!

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It does seem to be a totally different situation, especially comapred to up north where I live

The only bit of London I know is Cricklewood/Willesden 'cos of an ex - just for perspective, what would that are be classed as e.g. average, poor etc.

Willesden is very run down, my Grandmother lives there and I work in education in the area.

We all want her to move but she won't have it. Willesden is part of the London Borough of Brent, which is officially considered a deprived area of London. I believe Brent is one of the boroughs where English people (or it could have been white English people) are a minority.

It is quite close to Harlesden, which my friend described as the gun crime capital of London. I am not sure if he is right, but I know there was a big police campaign to reduce gun crime in Brent and I think it has a high level of shootings.

Cricklewood I think is a bit better, but still not brilliant.

The thing with London though is that you might have a few blocks of streets that are great, then a fewstreets nearby that are an absolute nightmare.

Prices here also seem to be effected by how close to Central London you are. The nearer you are the cheaper the train fare. So even though Willesden is a dump property can be expensive. It defies logic I know.

Places like Kent Sussex Hertfordshire etc outside of London might be cheaper and nicer areas but the train costs to get into London are astronomical. I looked at living in Hertfordshire and was told the train would cost around £2,500 a year and that didn't include paying maybe £1000 or more for a travel card for the underground. (It depends how many zones you want to cross)

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A key consideration is the rental value. Taking a quick look through Wimbledon rentals suggests something similar would rent for roughly £2000 per month, see this as an example,

http://www.rightmove.co.uk/viewdetails-200...4&tr_t=rent

At say a 7% BTL interest rate you'd have to buy it for something less than £350k in order to stand a chance of covering the mortgage from rental income (allowing for voids and repairs you couldn't do that immediately, but maybe in a few years the property might start to wash its face). Someone looking to augment their pension might place a premium on the fact that this property is convenient for public transport, and Wimbledon will always attract couples with young kids because of the common, consequently this should be an easy property to rent out. Therefore I'd guess the floor price would be round about £400k. Is that "affordable"? I think it is, easily. A 25% deposit would take the loan down to £300k, at x4 income that's £75k for a sole earner, or say one person earning about £55k and a partner earning say £30k. Nothing rare about that in London. Toss in a small premium because it's recently modernised and the kitchen/diner opens directly onto the garden, and I doubt this property will come down much below about £450k.

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Many tend to forget bonuses as well, my neighbour whos daughter works in the banking sector was picking up quarterly bonuses of £15k plus.

No doubt this has stopped now or at least fallen dramatically but still she had it good for a number of years, making a nice deposit for this type of property at £400k.

Also remember much self employed earnings go undeclared, when you have tradesmen in London earning £250 a day or £50 call out how much of that is declared, how about £150 a day cash in hand...it goes on and that is where the money comes from

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In London? That was around the average graduate wage when I graduated in 1997 (In London). A receptionist gets more than that here.

http://www.prospects.ac.uk/cms/ShowPage/Ho..._/p!eaLXbeX

Average (official figures) grad salary 2006 was £18,000. Currently claimed to be £22K plus. Also see qualifying factors related to location etc in link above.

Reality is that employers are offering 14K -20K routinely outside London. Often little more in London, excluding financial world. I have two sons, Warwick Ist BA, MA, and Bristol Ist BA, MA - and both were offered well under £20K in their first jobs (London, Brighton, Manchester).

Sure, a receptionist can earn more than a graduate. It's getting to be a difficult marketplace for grads, good uni's or not.

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A key consideration is the rental value. Taking a quick look through Wimbledon rentals suggests something similar would rent for roughly £2000 per month, see this as an example,

http://www.rightmove.co.uk/viewdetails-200...4&tr_t=rent

At say a 7% BTL interest rate you'd have to buy it for something less than £350k in order to stand a chance of covering the mortgage from rental income (allowing for voids and repairs you couldn't do that immediately, but maybe in a few years the property might start to wash its face). Someone looking to augment their pension might place a premium on the fact that this property is convenient for public transport, and Wimbledon will always attract couples with young kids because of the common, consequently this should be an easy property to rent out. Therefore I'd guess the floor price would be round about £400k. Is that "affordable"? I think it is, easily. A 25% deposit would take the loan down to £300k, at x4 income that's £75k for a sole earner, or say one person earning about £55k and a partner earning say £30k. Nothing rare about that in London. Toss in a small premium because it's recently modernised and the kitchen/diner opens directly onto the garden, and I doubt this property will come down much below about £450k.

That particular property is actually a flat but yes, you're not far off the rental value. I would say it's nearer £2.5k for this house, at least that is what I would think reasonable. Your opinion on £450k ties in with what I was originally thinking, perhaps a little low because there are some great schools nearby and lots of families pay a slight increase because of that. It's actually what I'm thinking as my son will be the right age in a couple of years. If we said that the value will drop to between £450k and £475k then offering early 500s wouldn't be terrible if one were to stay in the long term. Would you agree? Perhaps I ought to wait it out for another year and see what happens. I don't suppose I'm losing all that much, I just hate paying someone else £2.5k to rent their house :)

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http://www.prospects.ac.uk/cms/ShowPage/Ho..._/p!eaLXbeX

Average (official figures) grad salary 2006 was £18,000. Currently claimed to be £22K plus. Also see qualifying factors related to location etc in link above.

Reality is that employers are offering 14K -20K routinely outside London. Often little more in London, excluding financial world. I have two sons, Warwick Ist BA, MA, and Bristol Ist BA, MA - and both were offered well under £20K in their first jobs (London, Brighton, Manchester).

Sure, a receptionist can earn more than a graduate. It's getting to be a difficult marketplace for grads, good uni's or not.

That's actually terrible, something has gone seriously wrong, unless your sons were looking for a very specific vocational career then the advice they received was bad and someone should be talked to in very strong terms. A first from Bristol and Warwick and a starting of under £20k in London? That's incredible. My sister in law started on £45k and she got a 2:1 from a trad red brick. We wouldn't dream of employing someone at less than £30k. Competition is too high. You can walk into McKinsey on £45k. Heck my brother just started a new job at Pet City or some big pet place and he's never got a qualification in his life. He's on £26k and that's in Basingstoke!

The figures I see banded about re. grad salaries is usually nonsense. It tends to include the thousands of grads that did sociology or American studies at the University of West Ealing :)

Edited by schuey100
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I'm interested in purchasing this place:

http://www.rightmove.co.uk/viewdetails-18737575.rsp

Assuming you are renting, would like to buy a new house and have the deposit you need, what kind of price drop would you need to see to make this a worthwhile purchase? Would a 10% drop make you feel happy about buying and not getting into trouble at a later stage? Or 20%? Maybe only 5%? I'm thinking that an offer of £520k in the current climate would be fair but am interested in what others think. Am I being a bit ambitious at thinking about such a drop?

I was looking thinking £260K thinking Kensal Rise in London (and just my take on the value of a quite nice house, my brain is still pre-bubble) and then saw Wimbeldon, 300K ... and then saw the price!

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That's actually terrible, something has gone seriously wrong, unless your sons were looking for a very specific vocational career then the advice they received was bad and someone should be talked to in very strong terms. A first from Bristol and Warwick and a starting of under £20k in London? That's incredible. My sister in law started on £45k and she got a 2:1 from a trad red brick. We wouldn't dream of employing someone at less than £30k. Competition is too high. You can walk into McKinsey on £45k. Heck my brother just started a new job at Pet City or some big pet place and he's never got a qualification in his life. He's on £26k and that's in Basingstoke!

The figures I see banded about re. grad salaries is usually nonsense. It tends to include the thousands of grads that did sociology or American studies at the University of West Ealing :)

Engineering grads with us start on £22k rising to £25k over 3 years.

Once qualified (Chartered) and stay with the company they usually earn between £40-£50k

If your in the right field and take on a degree that is meaningful then within 3 years of leaving uni you can easily be earning £35k+, too many degrees that mean nothing out in the real world.

Edited by Jonnybegood
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Engineering grads with us start on £22k rising to £25k over 3 years.

Once qualified (Chartered) and stay with the company they usually earn between £40-£50k

That sounds okay I guess, upwards of £40k after 3 years. But what's the progress from the $40k/£50k mark? does it go up by another large jump after another two years or so? I suppose engineering grads have a lot more security than those of us working in tech fields or banking/finance.

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http://www.prospects.ac.uk/cms/ShowPage/Ho..._/p!eaLXbeX

Average (official figures) grad salary 2006 was £18,000. Currently claimed to be £22K plus. Also see qualifying factors related to location etc in link above.

Reality is that employers are offering 14K -20K routinely outside London. Often little more in London, excluding financial world. I have two sons, Warwick Ist BA, MA, and Bristol Ist BA, MA - and both were offered well under £20K in their first jobs (London, Brighton, Manchester).

Sure, a receptionist can earn more than a graduate. It's getting to be a difficult marketplace for grads, good uni's or not.

Thanks for the link it says:

1. Figures derived from the latest 2007/08 issue of Prospects Directory revealed that the average starting salary offered to 2008 graduates is £24,048 and the median salary* is £23,500. Prospects Directory is an annual graduate recruiters' directory published by Graduate Prospects and features thousands of jobs and hundreds of employers. The latest 2007/08 issue is aimed at 2008 graduates. The salaries offered ranged from £14,732 to £39,000.

Thats about what I would have imagined. This is of course graduate recruiters. Not every graduate gets a graduate job, some end up stacking shevles in Tescos or whatever until they find their way, so this will bring down overall graduate wages, but according to the link you supplied, if your sons had a job offer from a graduate recruiter, then the salaries they were offered put them in the bottom 10%. (I'm looking at the little table on the link)

I couldn't see the part showing average London wages for Graduates. I know that my London waiting (public sector) is around 3K.

I took what was typically a job offered to new graduates in 2004 in London and the starting salary was 19.5K and went up to 21K the next year. This was just a Government job (not financial) and I just have a 2.2 in history. I didn't think it was a competitive salary at the time.

Edited by BecksMyCat
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Thanks for the link it says:

Thats about what I would have imagined. This is of course graduate recruiters. Not every graduate gets a graduate job, some end up stacking shevles in Tescos or whatever until they find their way, so this will bring down overall graduate wages, but according to the link you supplied, if your sons had a job offer from a graduate recruiter, then the salaries they were offered put them in the bottom 10%. (I'm looking at the little table on the link)

I couldn't see the part showing average London wages for Graduates. I know that my London waiting (public sector) is around 3K.

I took what was typically a job offered to new graduates in 2004 in London and the starting salary was 19.5K and went up to 21K the next year. This was just a Government job (not financial) and I just have a 2.2 in history. I didn't think it wasn't a competitive salary at the time.

I think it's also worth noting that most of the best employers don't advertise in prospects, they go direct to universities. If I remember correctly Prospects advertises graduate roles with companies such as Mcdonalds. There's nothing wrong with that but these are not the best paying jobs out there. If this is where the figures come from then they will be very low compared to reality.

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The property has a loft conversation and kitchen extension which from the photos seems to be a high quality job.

Extension - £30k

Loft & Ensuite - £20k

You will be suprised how quickly the other £30-50k can mount up, plastering each room, getting carpenters to fit new doors and architrave, new flooring, kitchen, bathroom.

It all seem to have been done to a high standard.

I assume you are currently renting as you have no appreciation for tradesman prices, plumbers , carpenters , builders in the London area.

And yes you can build a house for this type of money but first you need land, and that is not freely available and when found can be expensive, normally more than the cost of the building itself.

Anyone in the building trade will tell you it costs more to renovate than build from scratch as it normally means removing the old first before you begin adding to the overall cost.

I assume you still think builders are busy. Face it Schuey, its over mate.

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That sounds okay I guess, upwards of £40k after 3 years. But what's the progress from the $40k/£50k mark? does it go up by another large jump after another two years or so? I suppose engineering grads have a lot more security than those of us working in tech fields or banking/finance.

No that is pretty much it, they are given projects to work on and depending on performance they get the annual pay rise which averaged 5% for 2007/08.

The next move for them is into management or senior engineer position within 10 years with earning potential in the mid to late 70s.

We are starting to lose a number of ex grads to British and foreign companies in Saudi and bahrain, wages there are tax free and typically the same kind of work for a grad 7 years out of uni will pay £60k

Edited by Jonnybegood
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That particular property is actually a flat but yes, you're not far off the rental value. I would say it's nearer £2.5k for this house, at least that is what I would think reasonable. Your opinion on £450k ties in with what I was originally thinking, perhaps a little low because there are some great schools nearby and lots of families pay a slight increase because of that. It's actually what I'm thinking as my son will be the right age in a couple of years. If we said that the value will drop to between £450k and £475k then offering early 500s wouldn't be terrible if one were to stay in the long term. Would you agree? Perhaps I ought to wait it out for another year and see what happens. I don't suppose I'm losing all that much, I just hate paying someone else £2.5k to rent their house :)

Rent & Relax would be my advice.

I pay nearly £2.5k per month to rent a three bedroomed house in Richmond, and I'm has happy as a pig in sh1t!

My landlord thinks very fondly of me because he believes I'm subsidising his pension, and I think very fondly of him because I believe he's subsidising my accommodation during a crash!

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Rent & Relax would be my advice.

I pay nearly £2.5k per month to rent a three bedroomed house in Richmond, and I'm has happy as a pig in sh1t!

My landlord thinks very fondly of me because he believes I'm subsidising his pension, and I think very fondly of him because I believe he's subsidising my accommodation during a crash!

Hehe :) I was looking in Richmond actually, there's not much going at the moment so I think I'll stay in Wimbledon. As you say, I might just rent and relax. I saw a nice place earlier today at only £2.2k which would suit us to the ground for a couple of years. As you say, maybe I should just sit back and relax for a bit and wait to see prices drop. I really hope they do :)

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Hehe :) I was looking in Richmond actually, there's not much going at the moment so I think I'll stay in Wimbledon. As you say, I might just rent and relax. I saw a nice place earlier today at only £2.2k which would suit us to the ground for a couple of years. As you say, maybe I should just sit back and relax for a bit and wait to see prices drop. I really hope they do :)

So this thread is now closed.

Conclusion: House is overpriced and badly renovated. Area is OK but nothing special. Could offer £520k but it is possible that house could drop way below that. Houses were worth around £300k 5-6 years ago, could return to that level (Back to 2 years ago already). Prices wont go up anytime soon, certainly aren't selling so why not rent and see what happens. Original poster agrees, topic question answered.

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I would say it's nearer £2.5k for this house, at least that is what I would think reasonable.

You are so far off. I pay less than half that for my house. Granted mine is not extended into the attic, so is just a two bed. But I doubt one extra bedroom would cover £1350pm in rent.

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You are so far off. I pay less than half that for my house. Granted mine is not extended into the attic, so is just a two bed. But I doubt one extra bedroom would cover £1350pm in rent.

You obviously have a good deal. Florence rents a bit cheaper than Clarence but still, have a look at what's renting at the moment and it's no where near £1500. There's one on florence at the moment, number 16, on with some small agency, it's a student house, falling apart, not extended, a ***hole to be honest and they want £1500 for that :)

Here it is, no pictures for a reason :)http://www.findaproperty.com/displayprop.a...f0-0c0095207ff8

I saw it, YUK

Edited by schuey100
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Look at it like this...what do you think the land is worth that the house is sitting on?...most homes have four walls with dividing walls some sort of plumbing system and electricity supply...look through the fancy fixtures and fittings, do they improve your quality of life? for some they might.

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You obviously have a good deal. Florence rents a bit cheaper than Clarence but still, have a look at what's renting at the moment and it's no where near £1500. There's one on florence at the moment, number 16, on with some small agency, it's a student house, falling apart, not extended, a ***hole to be honest and they want £1500 for that :)

Here it is, no pictures for a reason :)http://www.findaproperty.com/displayprop.a...f0-0c0095207ff8

I saw it, YUK

Maybe I do. :lol: So perhaps my view of what these houses are worth is skewed by the rent I pay, but I don't think they are worth anything like £500k+. They really are very, very small and not suitable for a family long-term.

That house isn't number 16 btw, 16 is an end of terrace. And I don't see how it's a student house, student houses rarely come unfurnished, do they?

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