Roll up. Make your housing market prediction here.

superscotsman

It seems likely that the housing market will be jammed just like in the 1990s for many years to come. New blood are leaving universities with huge debt already. There will be a rise in young people living in caravans. My son will be leaving university shortly, and I have no idea how he is ever going to afford a house. I have given him my advice: leave the country.

Woby_Tide

superscotsman wrote:

I have given him my advice: leave the country.

I'd say that if I lived in scotland too, good advice....;)

shammyjack

BUSTED !

In my town hundreds of appartments developed from old wool mills and schools + lots of new builds and a mammoth old hospital conversion are still for sale and lots appearing on the rental market ( average property value of £250,000 ) rentals are being offered for these at under £400 a month so anyone buying to let has probably lost out. :rotfl: :T

Planning commitee is still inudated with applications for redevelopement and conversions but 3 local sites with permission for over 150 flats etc have been derelict for up to 3 years.

Even terraced properties which are normal starter homes have started to drop in value significantly .

shammy

tomstickland

Prices for FTB houses are falling here. 6 months ago you would never see anything below £100K. Now there are flats etc going for £80-80K.

deemy2004

Wahooo ! The crash has started
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maybe....

wolvoman

GingeG wrote:

I cant understand that, say for example I am paying 650pcm rent and for that I get a roof over my head but each month I still own nothing. However if I am paying say 800 PCM to a mortgage at least I am chipping away at owning the property and I still have the capital value to realise.
I respect your view however I guess that I disagree with you.

You only disagree with me because you're not working this out logically and rationally. You're using the old adage of renting being 'money down the drain' and believing it at face value without actually doing the maths!

To use YOUR figures from above:

Rent at 650pcm versus buy at 800pcm.
That means by renting you could save £150 per month. In a year that is £1800+ (with benefit of compounded interest). Oh and then there is interest on the deposit money that is sitting in a bank account because it isn't tied up in a property.
There is no way paying a mortgage can chip away the outstanding debt as fast as that.

The only saving grace to a buyer in this scenario is if house prices rise during the equivalent rental period. If they stay static then renting is more cost effective. If house prices fall (even a tiny amount) then renting is seriously quids in.

So back to my original point which is that over the long term (5-10+ yrs) house prices will probably rise and so buying will be more cost effective. But short term (say up to 5 years) renting is better.

deemy2004

Even if house prices don't fall or rise for 5 years, they will be some 15% cheaper in real-terms.

And say if your cash rich, you will have made some 30% interest on the money

And / Or saved £10k on the rentals.

So thats a gain of around 45 - 50% IF house prices neither fall nor rise

GingeG

wolvoman

Thanks for yr explanation I see your logic now. I myself went from "cash rich" recently and bought a place becuase of my strong position I got a good deal and put down a large deposit so I know what you mean about cash in bank.

G

zappahey

wolvoman wrote:

To use YOUR figures from above:

Rent at 650pcm versus buy at 800pcm.
That means by renting you could save £150 per month. In a year that is £1800+ (with benefit of compounded interest). Oh and then there is interest on the deposit money that is sitting in a bank account because it isn't tied up in a property.

That also ignores the cost of buildings insurance, life assurance and home maintenance that come along with buying a home.

wolvoman

GingeG wrote:

wolvoman

Thanks for yr explanation I see your logic now. I myself went from "cash rich" recently and bought a place becuase of my strong position I got a good deal and put down a large deposit so I know what you mean about cash in bank.

G

I have gone the other way. Sold my place a couple of years back and am now renting with a big pile of cash sitting in the bank (and shares etc.). I'm better off renting - well I would have been had I not spent some of the cash pile on a Porsche.

Of course when I sniff that house prices are stable and/or increasing then I will buy again. I do appreciate that many people can't keep swapping between renting and buying as their mortgage and family circumstances might be different.


I get told all the time that renting is a waste of money, but 99% of people who tell me that have never worked out why. In fact they have probably been passed that old wive's tale themselves!