Roll up. Make your housing market prediction here.

bunking_off

wolvoman wrote:

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.

Don't believe the hype about Porsches...the residuals are just as pants as lots of other marques. They just look good because people compare list price with 2nd hand - forgetting that you need to spend five grand on extras over the list price to bring them up to a serviceable spec.

Where do you live? Obviously South East. If you lived here in the North and sold in that timeframe, you'd be crying about losing approx 25-30%s worth of growth (bought my place for £200k at that time, current valuation £300k - not that I'm thinking of selling because it's a home, not an investment).

Incidentally on a micro-market survey, next door & next door but one are both for sale - both owners downsizing. Both had houses on market during the summer and got no interest so withdrew from sale. Both put houses on market 3 weeks ago, same price as earlier. Both have sstc, full market value. Perhaps it's atypical, but it does look like the market's starting to move a bit more.

meanmachine_2

Thanks for that insight bunking off.

Firstly, why have you had your property valued if it isn't an "investment"?

Secondly, I'd use the current market in the South East as a barometer as to what is going to happen in your area. It's the ripple effect.

From my experience on the ground, I can buy exactly the same with my money now as I could in 2003, if not MORE!

And lastly, how do you know these properties have sold for "full market value"?

Unless you're an estate agent and you actually sold them yourself and have the paperwork in front of you...

Take it from someone who is actually looking to BUY a place, rather than assuming my pile of bricks is appreciating by 50% a year, as your figures would have us believe: buyers in my area, S London, as of 25 November, are thin on the ground.

My energy bills are soaring, fixed mortgage rates have risen recently, and two of my mates have just been made redundant. I ain't going to suddenly be paying more for your property now, or in the nr future.

So bear that in mind those of you with houses to sell at 200% more than you bought them in 2003.

That's the reality, as I see it.

Oh, and before I forget, of the 8 properties I've seen so far, three have already dropped in asking price, one is under offer, and the other four are still on the market.

bunking_off

MM

Clearly different things happen in different areas. "Full market value" - ok, it was a quick message I left. Should have said "Full asking price". How do I know? Well I know (from experience of living there for 10 years) that it's a strange concept in the south east, but around here we actually speak to our neighbours. Believe me, mine aren't the type to exaggerate or lie and I'm quite disappointed that they've sold because they've been good mates. (Plus, I'd also add, the buyers of one of the properties are friends of a friend so I've had it confirmed from two independent sources, ie buyer and seller).

Why did I have my house valued? Quite simple really, two reasons. 1 : I have a new build. After 2 years, the warranty switches from the builder to the NHBC. It's prudent to have a survey done before then to ensure that any snags have been properly resolved - it's also useful as a tool to beat the builder up. 2 : The interest rate on my mortgage is set according to the size of the loan versus value of the property. If I could get the size of the loan <50% value of property, then I'd shave 0.25% off my mortgage rate - in other words the cost of the survey, which gave the higher valuation, paid back over approx 4 years of reduced interest payments.

I was very clear that I made no assertion about the state of the market as a whole, only what was going on around here. The market here did slow down (go into reverse) over the summer period. However, as I say, on an admittedly minute sample, things are shifting now.

I realise this doesn't fit either with what you wish to hear, or with what may be the case where you live. However, I'd appreciate if you didn't imply I was making things up, or even worse was an estate agent (actually I'm a chartered engineer).

tomstickland

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.

You've reminded me to get on with some basic maths. I wanted to compare:
-renting at £450 pcm, meanwhile with a £6K of deposit in 5% savings account and adding a further £600 pcm to the savings.
-using the deposit to buy a house etc and then paying a mortgage of £600pcm plus bills etc etc and saving probably £300 pcm.

I want to calculate what I gain/lose over a two year period, assuming that house prices stay the same.

When I'm saving then I'm gaining 5% on 10K ish. If I bought then I'd be paying around 5% interest on a 90K loan. (all relative to inflation of course).

meanmachine_2

bunking_off wrote:

I realise this doesn't fit either with what you wish to hear, or with what may be the case where you live. However, I'd appreciate if you didn't imply I was making things up, or even worse was an estate agent (actually I'm a chartered engineer).

Please do accept my apols. I can think of nothing worse than to be falsely accused of being an estate agent.

My experience with homeowners is that they tend to exaggerate how much they got for their property and downplay how much they paid for a property. But then, maybe I just need a more honest set of friends.

Nethouseprices has revealed a lot of fibbery on that front, I tell you.

As I've said in other threads, in my area there was a defo pick up in Sept and October, but things appear to have gone dead again. Although I suspect that that's as much to do with the Yuletide season.

I've never heard of a boom happening in November. It doesn't seem like the time of year to buy a house, but who knows? Today's housing market is a bizarre animal.

bunking_off

Quite surprised me as well - indeed I was surprised when they both decided to go back on market at this time of year. As I say, two sales don't make a boom though.

rozeepozee

meanmachine wrote:

Please do accept my apols. I can think of nothing worse than to be falsely accused of being an estate agent.

How about being falsely accused of being a solicitor

kinster_2

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

didn't know the rich needed a mortgage?

kinster_2

The conclusion of this thread is that property owners think 'ownership' is good and there is no crash, and everything is stable, while renters think that there is going to be a crash...

meanmachine_2

Then property owners are idiots.

If prices crash, the rungs on the ladder get narrower and moving up gets easier. Any homeowner who supports rampant house price inflation, pushing the rungs apart needs their head examined. There was a piece in the Mail this week explaining all of this.

But then Brits are notoriously ignorant when it comes to their finances, so I'm not surprised.