Would I be crazy to consider buying now?

penguine

JayZed wrote: »

I'm a little puzzled by the suggestion that it's a bad time to buy because interest rates are low. I appreciate that's not exactly what the previous posters are saying, but the suggestion that you shouldn't buy now because interest rates might shoot up is counter-intuitive.

The fact that interest rates are extremely low at the moment is a factor that should be taken into account when considering affordability. Mortgage payments that look affordable now may well not be if interest rates return to 5%.

JayZed wrote: »

As for the future of house prices, well yes, they might continue to go down and they might remain low for some time, but that's not necessarily a reason not to buy now. Calling the bottom of the market is a tricky proposition, and the key basis for the decision should be affordability, not asset values. It's clear that the OP is giving serious thought to the affordability issues.

You don't need to buy at the "bottom of the market" (which obviously is going to vary from place to place and can't be determined until afterwards) to get a property at a good price. But because prices have been so high for so many years, what looks like a bargain now isn't necessarily so.

From Moneyweek:

...despite the 20% or so fall in house prices from the peak, the UK house price to earnings ratio is still around 4.8. That's still way out of line with the long-run trend, of between 3.5 and 4 times. That means house prices sill have to fall another 17-39% before they reach their "fair value".

poppysarah

JayZed wrote: »

I'm a little puzzled by the suggestion that it's a bad time to buy because interest rates are low..

Fix for the whole of your mortgage life and never default or be late paying and avoid getting switched rate and low interest rates now are fine.