Questionably Bad Advice Given on here!!!!!! FTB Look HERE!

hethmar

I wish that were the rent price for even a one bed flat in this area and then I could get rid of youngest son.

I think as said, each area is different and you need to be on the spot to know what the best thing to do is, plus the posters' personal circumstances. No one can generalise.

And hey, I object to the reference to Skodas ! Ive had a fabia for 4 years, after a lifetime of Golfs, its been brilliant.

Soot2006

I wish I could rent something under £500 ....

It is an individual assessment.

Totally agree with this.
If I WANT to buy something this year and feel I am in a secure enough financial situation to do so, then why shouldn't I? A house *IS* a home for some people ... I have no children and no intention of having any, so if my OH and myself LIKE a place and can (now, finally) AFFORD it .... let's buy it!

KiKi

All posts on these forums constitute personal opinion only. If you post a question on an internet forum, you will receive opinions back.

If posters want advice, they should go to a professional and independent advisor.

Maybe there are people with questionably poor judgement on here, but it's never 'questionably bad advice'.

KiKi

pandamonia

Yet again you see this from a standpoint of today and not tomorrow.

A lot of people on here need to open their eyes to whats going on and the ecconomic effect this is having.

Regarding the rent issue -

There are more buy to let houses up for lease than ever before. Just about every man and his dog and trying to rent out their house due to not being able to sell. alot of people are buying a second home and renting out their old one. If you check the papers you can get some serious deals on renting all over the place. City centers are flooded with emtpy investment flats which are "unsellable" The over supply will force people to rent them out cheaper and cheaper just like houses! the renting market is linked in with the house sale market. just because it says 500pc doesnt mean you cant phone up and say ill give you £350 take it or leave it.

also you think £600pc a month is bad? well in areas of higher value the rents should also be higher yes? so if you wanted to buy a £300k home now which is say maybe 3 bed, then over the next 12 months it will lose a possible 45k! london prices are also very very shakey, renting in the financial district as fallen buy 1/3 !

Now 45k over 1 year is £3750 per month!!!!!!! and you think 600-800 is bad?

This is a financial crisis we are in here people, if you think the dog is worth near 4k per month just to buy your home then your prioritys are all wrong, next 24 months will see unemployment hit record levels which could also be you!, you say about schools but there is always homes up for let near schools if u can find them, you can also take out 12 month leases and more so you dont need to move around a lot.

if you can afford to have 45k wiped off your personal balance sheet in one year and have money to burn then yes by all means buy now?

But if you read i was geared towards the FTB in my post, but the same principles apply to everyone.

and yes its my opinion but its an opinion which my professional friends share deeply.

I also dont post here very often i have just been reading and felt the need to add to this forum, i generally contribute to a closed forum with some IFA's who share mutual advice.

t1gger

I agree with all of that; it's easier to be out the market waiting to get in than in the market trying to get out.

I'm not sure about people on the forum giving bad advice though, most of what I read is reasonably cautious and seems sensible.

On the rent thing, I live in Scotland in a reasonably expensive seaside town and was recently offered a 5 bedroom terraced house for 500pcm. Hardly London prices up here though.

However I don't think the cost of renting was really the main point of the original post.

pandamonia

I suppose you are correct, maybe bad was the wrong word to generalise but i read 10 FTB threads and it was those who prompted me.

what worrys me most is this is Moneysavingexpert.com and people here are talking about saving a few hundred each year on bills but willing to lose thousands per month on houses.

Soot2006

pandamonia,

I do in one sense see what you're saying in terms of how many FTB don't seem to realise what is going on with the economy/housing market & are still asking about 90-100% mortgages, etc ...

But you also need to see that not all FTB are in the same boat. So many of us (FTB) have been keenly following the market for years now - we are not more stupid than other people. On the contrary, the only reason I don't currently own a house is because it didn't make financial sense to commit myself to the type of loan that would have required to the buy a house I like.
That lag has now given me a very reasonable deposit which is gaining value by the day as house prices continue to fall.

And there comes a point where I need to make the decision that it's OK to buy now, because for - for ME - the risk is now acceptable and within my personal gambling limits.

pandamonia

Thats a fair point and i also address this in my post at the top. but as i said to you before the time isnt now.

"dont try and catch the falling knife"

You have done well to wait but i know how tempting it can be when you see a 10-15% fall off the house you want which suddenly is within your grasp but the real skill is holding off until this cycle has taken its course. i suppose its the feeling you get when you buy that jacket in the sale with 15% off then the next week there is 30% off and the next week 45% and by the time its half price you feel totally sick and want to burn the jacket out of spite.

Thrugelmir

FTB it is not a good time to take out any mortgage, 5-6% Variable rates currently and 6-7% fixed from a base rate of 1.5% which is due to fall! if you take out one of these mortgages you could find that in a year or 2 you are paying over 10% as the base rate rises. Can you afford 10%? You could also find yourself in negative equity stopping anyone from being able to remortgage you to a better rate.

So when is a good time to take out a mortgage?

Standard mortgage rates are unlikely to fall further even if base rates fall further. The average mortgage in the US is still around 5% though base rates are more or less at 0%. The one flaw in your argument is the basis that it is the purely the cost of the flat\house that matters. The actual cost of a house is what you pay for it plus mortgage interest. Over 25 years the amount of interest paid is considerable. So if you are able to lock into a good fixed rate now it could pay dividends over the years to come.

Over 25 years a repayment mortgage of £120,000 at 5% will cost £93k in interest! At 6% an additional £21k in interest.

So buying a house\flat now might be the right thing to do if you can afford too. Bearing in mind that some FTB's are paying rent which is dead money as well.

The market will turn before people realise. Only a lucky few will be able to buy their dream house at the very bottom of the market.

This isn't a post recommending buying, but really that FTB's need to sit down with their calculators and make a hard finacial decision based on their own circumstances.

pinkshoes

pandamonia wrote: »

Regarding the rent issue -

There are more buy to let houses up for lease than ever before. Just about every man and his dog and trying to rent out their house due to not being able to sell. alot of people are buying a second home and renting out their old one. If you check the papers you can get some serious deals on renting all over the place. City centers are flooded with emtpy investment flats which are "unsellable" The over supply will force people to rent them out cheaper and cheaper just like houses! the renting market is linked in with the house sale market. just because it says 500pc doesnt mean you cant phone up and say ill give you £350 take it or leave it.

There are more people renting their houses out, correct, but there are also more people wanting to rent.

IN MY AREA good properties in good areas are seeing massive rent increases, as everyone wants to live there, and the competition to rent these properties has stepped up.

The grotty properties in grotty areas are seeing large rent drops, as people are going for the nice ones in nice areas first, so would only take these as a last resort, purely because they are cheap.

FTBs are generally not stupid, and many have their heads screwed on. Those that post saying they want to buy, borrowing 10x salary and only have 24p and a sherbet dip as a deposit are told to get real, but there are many people wanting to buy a home, who don't want to put their lives on hold for another couple of years. Don't forget some people are stuck in ghastly rental properties with evil landlords, and are very unhappy.