So when will House Prices Hit the Bottom?

Idiophreak

ad9898 wrote: »

No need to be touchy, just my opinion, you shouldn't be angry anyway, you obviously have done what you think to be right, so perhaps smugness would be a better state of mind.

Not being touchy, sorry, the !!!!!s make my post look more irate than it was - just not overly sure how you got to your original analogy...I'm not angry about things at all - I think this is the best thing for me and my gf, otherwise I wouldn't have done it.

Housesitter, obviously the terms vary from scheme to scheme, but on mine:

You don't pay any rent, the 25% deposit is an interest free loan for up to 10 years.

You can buy back the 25% in full, or in part, at any time during those 10 years.

The value at repayment is determined by the average findings of 2 independent (wonder if they'll take a bribe ) valuers.

The house price rises and falls with the market, as usual - I get 75% of any profit and take responsibility for 75% of any loss.

You also own 100% of the property from day 1 - a notable difference from shared ownership schemes.

Sure, the "exit" from these deals is tricky - not closing my eyes to that one...But if the property rises in value a little, I could maybe remortgage, buy their 25% back and still only have a 90%LTV - you never know. Hope for the best, I guess.

housesitter

So in 10 years you have to buy the rest of the property then, or what happens ?

It sounds like a better scheme than the rent types for sure.
However, the pessimist in me sees it as a good way for the owner of the scheme to sell an over priced house now, for less and after adjustment for lack of interst and inflation get the rest in 10 years time.

I'm sure you haven't, but I could see a lot of people missing the full cost, only thinking of the 75% as 10 years is a long time to think about the rest. I just hope they are saving from the start towards it.

Cat695

housesitter wrote: »

So in 10 years you have to buy the rest of the property then, or what happens ?

It sounds like a better scheme than the rent types for sure.
However, the pessimist in me sees it as a good way for the owner of the scheme to sell an over priced house now, for less and after adjustment for lack of interst and inflation get the rest in 10 years time.

I'm sure you haven't, but I could see a lot of people missing the full cost, only thinking of the 75% as 10 years is a long time to think about the rest. I just hope they are saving from the start towards it.

It is....if you went and bought the same house but with a larger deposit and you don't use the 75%/25% scheme you WILL get the 25% off

I went a viewed one on for 197k she tried to sell me the same scheme, when I pointed out I had a large deposit she dropped the prices to 173k straight away (not 25% I know)....without me even pushing for some off.

when i checked on previously sold houses they had gone for 160k.....so these schemes are a rip off

pyewackitt

Isn't this thread about identifying when/where the bottom of the market is?

I think it's great you've found a property you want to buy but i don't think you have presented any statistical or graphical data as to why now 'is a good time to buy' other than the purely annecdotal comments that other people you know are buying.

Looking at the UK housing market historically we still have substantial falls (expect 10-20% or more) left to come and that the rate of decline should be expected to start to slow but that the timeframe left for a bottom to be reached is still 18-48 (or 6 to 16 quarters) months away from now.

Following the reach of a bottom the housing market tends to stagnate for a period before beginning a very slow rise over a period of years.

Sentiment and local opinions and experiences are great but in my view you need to look at the fundamentals and historical prescidents when timing market entry. There are often quoted to be aprox.18year property supercycles that affect market conditions and timing and so far we are no where near commencement of the next supercycle.

IveSeenTheLight

Cat695 wrote: »

it took about 8 years in the last recession before they picked up again.....

Maybe on average, but I have shown before some areas that recovered within a year in the last "crash"

http://forums.moneysavingexpert.com/showpost.html?p=18398993&postcount=72

IveSeenTheLight

pyewackitt wrote: »

Isn't this thread about identifying when/where the bottom of the market is?

I think it's great you've found a property you want to buy but i don't think you have presented any statistical or graphical data as to why now 'is a good time to buy' other than the purely annecdotal comments that other people you know are buying.

Looking at the UK housing market historically we still have substantial falls (expect 10-20% or more) left to come and that the rate of decline should be expected to start to slow but that the timeframe left for a bottom to be reached is still 18-48 (or 6 to 16 quarters) months away from now.

Following the reach of a bottom the housing market tends to stagnate for a period before beginning a very slow rise over a period of years.

Sentiment and local opinions and experiences are great but in my view you need to look at the fundamentals and historical prescidents when timing market entry. There are often quoted to be aprox.18year property supercycles that affect market conditions and timing and so far we are no where near commencement of the next supercycle.

And you need to look at local data / property type data rather than get hung up on UK averages.

I've linked above showing that some local averages recovered within one year and did not take 18 - 48 quarters as you believe

ad9898_3

IveSeenTheLight wrote: »

Maybe on average, but I have shown before some areas that recovered within a year in the last "crash"

http://forums.moneysavingexpert.com/showpost.html?p=18398993&postcount=72

I think the difference this time compared to last time, apart from the usual suspects of unemployment, IR's, sentiment etc..., is this, the money no longer exists to keep prices at anywhere near the levels that are still being asked. Last time banks hadn't gone bust under the sheer weight of debt that was being asked for. Even if people want to buy now, 9/10 people that could have bought 2 years ago, now can't.

I really don't think Joe Public have any idea just how grim things are, as far as getting finance is concerned compared to recent history.

Snooze

Idiophreak wrote: »

I'm a FTB, I got an offer accepted on a place this morning.

I'm going to be buying on a joint equity scheme.

My sister (FTB) is also buying, she's getting 5% deposit paid by the builder, plus has a deposit of her own.

One of my dad's friends is buying for the first time.

A couple of other people I know, too, one of whom is being helped by the government homebuy initiative...

In fact, I think I know more people buying now than I have for a long time.

Sure, most of these deals are only good for those of us willing to pay the inflated price of new builds and all the other criticism, but the point is that we *are* buying...

House prices have dropped significantly, as we know - and whilst I doubt they're as low as they're going to get, they're actually *affordable* to FTBs now...And a lot of people have been prevented from getting on the ladder in the past by the super-high prices, so will take a chance at the mo to try and get a foot on.

I might be an isolated case, but I think all the people I know buying add up to a "green shoot", if nothing else.

I think you missed out the letter 't' when you created your username.

Rob

Idiophreak

pyewackitt wrote: »

I think it's great you've found a property you want to buy but i don't think you have presented any statistical or graphical data as to why now 'is a good time to buy' other than the purely annecdotal comments that other people you know are buying.

Is that directed at me?

Someone asked where the first time buyers were, so I replied. What kinda statistical data would you like? The names, banks account numbers and sort codes of the people I mention? :rolleyes:

A good time to buy is incredibly personal subjective - clearly I believe it's a good time for us to buy - otherwise I wouldn't be doing it...

There's a certain view says anytime other than the worst time to buy is a good time to buy and that's certainly the case now.

Cat695 I've no doubt at all that you pay more for the property using one of these schemes - but

a) I'd expect it to be closer to 10% than 25% for *getting an offer accepted now* (I'm sure if you're willing to wait it out, they'll take an offer of 75% eventually....*on certain developments in certain places*)

b) what does that actually matter, as long as you're confident the property will be worth more again in the future? You're buying above the market, but if you don't have a deposit, it's an option worth thinking about. You pay a little more now, obviously (otherwise what would be the point of the builder loaning you the money...), but it does have certain benefits, most notably *you can get a mortgage* and you get access to better rates.

IveSeenTheLight

ad9898 wrote: »

I think the difference this time compared to last time, apart from the usual suspects of unemployment, IR's, sentiment etc..., is this, the money no longer exists to keep prices at anywhere near the levels that are still being asked. Last time banks hadn't gone bust under the sheer weight of debt that is that was being asked for. Even if people want to buy now, 9/10 people that could have bought 2 years ago, now can't.

I really don't think Joe Public have any idea just how grim things are, as far as getting finance is concerned compared to recent history.

That's quite possible and what the governments are fighting at the moment

However my point is about people constantly referring to the UK average as what will happen to all properties across the country and the timescale it will affect all properties.

I'm merely saying to look more specifically at local figures