Rate Cut Ramifications - Paul Lewis of Moneybox on BBC News

PasturesNew

I made my move. Sell to rent.

1.5% doesn't bother me as all my savings are to buy a house. While they are going down or not moving, it doesn't matter that my savings are sitting still. That money is in cash and so still locked into that one asset type ... a house.

If house prices go up now, I'll consider it a bull trap from the rates dropping. But any money that ploughs in now is limited ... and will come to an end once they've all bought. Then what ..?

Going doooowwwn....

So I am holding my position. Cash, waiting for a house.

mr.broderick

PasturesNew wrote: »

I made my move. Sell to rent.

1.5% doesn't bother me as all my savings are to buy a house. While they are going down or not moving, it doesn't matter that my savings are sitting still. That money is in cash and so still locked into that one asset type ... a house.

If house prices go up now, I'll consider it a bull trap from the rates dropping. But any money that ploughs in now is limited ... and will come to an end once they've all bought. Then what ..?

Going doooowwwn....

So I am holding my position. Cash, waiting for a house.

Well done pn and good luck, hopefully your landlord won't be one who gets repossessed.

stevetodd

!!!!!!? wrote: »

Pretty much all the HPC folks were warning anyone who would listen not to buy and urging those in a position to do so, to think about selling when the going was good.

For people who listened to that advice, it turned out rather well unlike those who chose to go with the HPI forever brigade.

What you don't seem to realise is tha property s a long term investment, by that I do not mean that inestors necessarily want to stay in a falling market. I mean that in my position for example I rent my properties out on one year contracts and it usually takes a few months on top of that to sell. It isn't like selling shares, so although the market might look gloomy there isn't a quick way out and most sensible investors realise this before they enter the market.

Additionally if you are looking to hold property for decades you have to accept that there will be a slump in prices, unless of course you need to retire. One think I have learned from this is to make sure I am not greedy and get out while the market is still rising (probably about 2022 ish)

[Deleted User]

Whilst its hugely frustrating that my rather large savings is earning next to nothing, i'd much rather this be the case than have huge debts and negative equity:rotfl:

As mentioned above also, this means ill be offering far less when i do come to buy a property:rolleyes:

chucky

Supercharge_Me wrote: »

Whilst its hugely frustrating that my rather large savings is earning next to nothing, i'd much rather this be the case than have huge debts and negative equity:rotfl:

As mentioned above also, this means ill be offering far less when i do come to buy a property:rolleyes:

you have the best approach - timing will now be even more important.
house prices won't rocket but i don't think that there will be massive selection out there.

indianropetrick

stevetodd wrote: »

What you don't seem to realise is tha property s a long term investment

Property is not a long term investment for the tens of thousands who bought in 2005-2007 at absurd prices. Their 'investment' will mean bankruptcy. This is already happening, but when the credit really drys up in the next 12 months, coupled with forced sales due to huge job losses, we're really going to see what a bad gamble property was.

ShelleyC_2

PasturesNew wrote: »

I made my move. Sell to rent.

1.5% doesn't bother me as all my savings are to buy a house. While they are going down or not moving, it doesn't matter that my savings are sitting still. That money is in cash and so still locked into that one asset type ... a house.

If house prices go up now, I'll consider it a bull trap from the rates dropping. But any money that ploughs in now is limited ... and will come to an end once they've all bought. Then what ..?

Going doooowwwn....

So I am holding my position. Cash, waiting for a house.

Ditto except I'm less good natured about the !!!!py savings rates than PN but had I bought as planned in end of 07 I'd be even less happy :rolleyes:

overlander

Really amazing how short sighted some people are. I'm saving 150 a month yippee but my house is losing £1500 a month yipeee.

olly300

overlander wrote: »

Really amazing how short sighted some people are. I'm saving 150 a month yippee but my house is losing £1500 a month yipeee.

You are not losing unless you are forced to sell.

If you don't have to sell for the next 8-12 years depending on the type of property you are in then you should be all right.

Well according to the information I got from people who brought in the last boom - and some of those who are in 2 bedroom plus properties are still living in the flat/house they brought.

Kenny4315

The house value to me is paper dollars, as I'm not selling in the near future, while a mortgage reduction represents real reduction in cost.