big risk or not

andrewmp

kerryi27 wrote: »

yeah, I know houghton le spring. My friend owns an Estate Agent there, Kipling Harnett. I asked her and she thinks I am getting it at a fair price



http://www.nethouseprices.com/index.php?con=sold_prices_street_detail&street=SKIPTON+GREEN&locality=GATESHEAD&town=GATESHEAD&cCode=EW&year=All&house_style=All&house_age=All&search_radius=15&outcode=NE9&incode=7DY&eastingToSearch=42670&northingToSearch=55830

Yeah I know of Kipling Harnett. She is right, it seems like a fair price, as long as you go into it with your eyes open knowing that there is a very good chance you will have no equity in your home in five years.

Is it this one?

http://www.rightmove.co.uk/viewdetails-17736862.rsp?pa_n=1&tr_t=buy

I hope it all works out well for you, consider taking out a longish term fixed rate mortgage as if you end up in negative equity, at least you won't end up on SVR.

kerryi27

yeah, thats it. thanks i hope it works out too. The lady has just accepted our offer today so think we are gonna go for it

andrewmp

kerryi27 wrote: »

yeah, thats it. thanks i hope it works out too. The lady has just accepted our offer today so think we are gonna go for it

Good luck, at least it's Low Fell, one of the better parts of Gateshead anyway.

lynzpower

my ex boyfreind used to live in Low fell, it was some time ago but it was definately the nicer area. small world

Im wishing you good luck too, you obviously had decided thats what you wanted to do from the outset. It does sound like a risky plan mind you.

One moneysaving question I will ask though is why you have such a small loan of 8k secured on your property? Couldnt you just get an unsecured loan and pay it off quicker? Secured loans are notoriously expensive and have plenty of unseen fees and charges. If you HAD to have a secured loan as a condition of the mortgage, then have it for 3 years- youve been able to make 2k from matched betting alone, theres no reason you couldnt keep moneysaving and save yourself an utter fortune in interest & charges.

huntersc

Well good luck with it. I have a bad feeling about it but other than what I've already said, I don't really know why. Now I've seen the property I'm even less sure. It just feels...like...a bad idea. I guess if I had money to invest for my future it wouldn't be into a market which is at it's worst point in 20 years and then into a property which falls into the bottom 1% of properties in the market, especially whilst prices are still dropping. Whether you can afford to do it isn't the point, it's whether you should and whether you could make more with the money you have.

But there's family involved and it helps your mum out too so looking at things rationally isn't always possible I guess.

Good luck again, I hope that house it worth £400k by the time you retire!

Trollfever

From Property Bee

History

dateevent07 August 2008

• Price changed: from '£87,500' to '£85,950'
• Status changed: from 'Under offer' to 'Available'

24 July 2008

• Price changed: from '£94,950' to '£87,500'
• Status changed: from 'Available' to 'Under offer'

01 June 2008

• Initial entry found.

dopester

kerryi27 wrote: »

well, the similar propertys were worth 115k last year at their peak, so we thought getting it at 77k was a good deal cos thats already a 30k drop. The owners did want 95k originally

kerryi27 wrote: »

hi , yes it is excouncil and is a 3 bedroom house. I dont think they can fall really much less than that.

And did you "think" or expect them to fall from £115K peak to £77K over a year?

Some people think we've only just entered in to this crash.

I think you should remain open to the fact we could have a mind-melting change in how people come to value property in this country.

Have you seen the auctions? Even slashed properties, much lower than what EAs have them on their books for, are not getting the bids.

ioscorpio

Nobody has mentioned Capital Gains Tax on the second property when you sell it.

What about a larger house or one with a granny flat, possibly a better bet long term than 2 ex council houses.

It is highly unlikely that your Mum will be offered a council property if she is renting a 3 bed home from a member of her family as she will not be classed as a priority.

http://shelter.dev.squiz.co.uk/get_advice/advice_topics/finding_a_place_to_live/council_waiting_lists/who_gets_priority

huntersc

ioscorpio wrote: »

Nobody has mentioned Capital Gains Tax on the second property when you sell it.

What about a larger house or one with a granny flat, possibly a better bet long term than 2 ex council houses.

That's a very good point about capital gains. I totally forgot! That will certainly eat into any potential profit.

kerryi27

well, we have decided that we are gonna save as much as we can over the five years into an ISA, I opened one last night and set up £50 weekly standing order, i am also looking into doing credit card stoozing and im gonna do a couple of bets a month and pay that in.

The view is to try and save as much as poss and in five years hopefully if interest rates are not extortionate we can pay off as much capital as we can and hopefully with my mams pay increases from work we can get her rent to cover a repayment mortgage.

we know it is a risk but overall property always gopes up in the long run. If you dont take a chance youll never go far. What do they say reach for the stars and if you land on the moon.......

still undecided where to get the money for the deposit from. Dont understand about the 3 year secured mentioned above.

worst comes to worst, we can take a look and reaccess and decide what to do with the money weve saved ie pay our loan or mortgage or mams house.