Future of house prices & the buy-to-let mkt

sanfrancisco

meanmachine wrote:

As I'm no longer actively looking, I've lost interest - just as the market seems to be heading into a second boom phase! (well, according to rightmove, anyway...).

See here ... http://www.housepricecrash.co.uk/forum/index.php?showtopic=24736

meanmachine_2

I'd welcome a second boom - as it would hasten a spectacularly vicious crash. But I take all of these indices with a pinch of salt.

Also, the media's take on the market is entirely pegged to what's going on in London. At the moment, the London market is OK, so the BBC journos etc think everything is rosey. Prices could be diving in Lanarkshire and they wouldn't give a stuff.

But as I say, I'm not miserable about the market. I'm remarkably sanguine. Our fate is in the hands of the Japanese, Chinese and Americans (as it always has been). If those countries want to choke Northern Rock's ability to lend on a ridiculously lax basis, then it'll happen.

Most ordinary buyers don't follow the market closely. When they want to buy, they tottle down to the bank, borrow the maximum and then look at what they can get for their money. If they can't borrow as much as they could before, then the market will fall.

Plus, there's the other issue of whther they've actually got jobs, thanks to global competition, falling productivity, rising bills etc

trencherpilot

I rent out my "old" house and live nearer my job. The only downside is filling in a Self Assessment Tax Return.

The plus side is the house value has gone up £30000 in 2 and half years.

That out performs a pension!

MiserlyMartin

moneysavingobsessive wrote:

I bought a house last year and due to a job change, it is likely that I will move out and get some tenants in.

I have informed by bank that I am thinking of doing this and apparently, if the rental income covers the mortgage, some lenders would lend to me again. This would mean that I could buy nearer my new job, although obviously run the risk of my rented house being empty and having to fund two mortgages.

Just wanted peoples opinions on the risk/return of a strategy such as this and general feelings about the housing market.

When I did this a few years ago I was told by Nationwide that they would not ignore my current mortgage debt because I may have void periods in the old house. So I borrowed my maximum - minus the current mortgage debt. It is the safest way. Re: Capital Gains Tax, if you only have the two houses for 3 years then you are exempt. IE: move back to the old house and sell the new one within 3 years - no CGT to pay.

Or sell the old one within 3 years. 3 years is long enough for you to decide if a move is going to be a permanent one or not. Though I would not even buy another house if I were you. Rent close to your job. My prediction for the housing market? Crash. Dunno when....always hard to call but its going to happen sooner or later. All a question of timing, its well overdue already. I personally wouldn't buy another property at todays prices. May be sensible to keep your old house though in case prices don't crash for another 5 years. Housing market is like the stock market these days, too many investors and not enough normal owner occupiers. Too many people all speculating over it (like us) and hard to play it.

trencherpilot

The crash as usual will happen in the south where prices are over inflated. The rest of the country hardly ever sees increases similar to the ones that have occured recently.

Looking back at previous trends, the slumps have always been outnumbered by the rises in property prices.

The best bit of advice I was ever given was that ON AVERAGE the UK house prices double every 7 - 10 years.

makingendsmeet_2

I personally can't understand why we are obsesed with making a profit on property.Why does property have to make us money? Surely at the end of the day most people are gratful to have a roof over there heads. We have just brought our first property and to be honest we don't see it as an investment or a way to make money. Its a roof over our heads and a base for our family. Over the next few years we will no doubt spend thousands of pounds on home improvement etc all adding to the cost, but if at the end of it the place is worthless then so be it. After all over the next 25+ years we will spend endless amounts of money on cars/holidays/clothes/food etc etc etc and have nothing to show for it but we won't complain about that, so why is a house any different? All our friends are forever going on about how they had made on there property. When of course the truth is that you don't make 1 penny until you sell and they can't sell as they would have nowhere to live. :money:

Pal

It isn't a discussion about making money on property. Everyone on this site acknowledges that, in the long term, property ownership is a good thing.

This discussion is about whether or not people should get on the property ladder now or leave it to a date in the future when prices may have fallen.

It is, after all, a money saving site.