About to buy a house.....help!!

kneeljewels wrote: »

I've had an offer accepted on a house and mortgage agreed. But, with the current situation with Northern Rock etc (the mortgage is not with them) am I being foolish buying at this point in time? or should I rent for six/twelve months and reassess then?
I'm asking because if I'm to pull out, I feel now is the time, before any legal services and surveys etc are done.

If you're worried that if you get a mortgage from someone and they later go bust before you pay the money back - have no fear. Your debt will be sold on to someone else who will be quite happy to take the mortgage repayments from you.


But if you're thinking twice about dipping your toes into the housing market then you're quite prudent to be having second thoughts.

If you see a house that you really want to live in as a 'home' (ie. long term, not for investment reasons) and you can comfortably afford mortgage repayments then there shouldn't be a problem.

On the other hand, if you're just rushing to get onto the ladder then this is definitely a bad time to do so. I'd give it at least six months to see how things shake out with respect to prices.

Exactly two months ago on Friday 13th July, I had exactly this conversation with my DD.

This hard hearted old skinflint, told her not to trade up, but to grab the "cash" buyer and rent until the storm clouds cleared.

The good news is that she took the first half of my advice (but not the second half), so it has not been a complete train wreck.

Then I forecast a 10% fall in house prices over a year, today I've upped that guestimate to 15%.

As part of my research on her behalf, I consulted the Nationwide house price index and starting with 10K in 1973, the year I traded up to a house costing 16K, I followed the 10K through year by year; it was not a ever upward slope, in fact the fall in value after 1989 was not recovered until 1997, when again it approached 60K; then it went haywire and until yesterday was challenging the 200K barrier. Do you think you will be richer in 18 months time if you buy tomorrow?
Rent the house, not the money. The house price is falling , the cost of renting money is going up hand over fist.

Harry.

The rightmove Index quite clearly says that the drop is asking prices is due to a 40% drop in the number of four+ beds coming to the market because they don't want to pay for a HIP. Being more expensive than smaller houses, it is bound to an effect on the average asking price. August saw something like 4000 bigger properties coming to the market comapred to a usual 10000.

I don't for a second believe that vendors are dropping their asking prices just yet. Asking prices will fall in response to buyer demand and that won't register for a few months after any marked drop in demand.

I'm not being bullish, but using this to say that the crash is here is just another bit of HPC spin.

Oh Yeah. Ooops! I read that wrong!