Experts say wait 5 years to buy back into property

SingleSue

mewbie wrote: »

If that were true then we wouldn't be in quite such a pickle. Bubbles encourage risky behaviour. Everyone accepts housing has been in a bubble. The difference with this bubble and others is gearing. Borrow 10k to make 50k. Sounded too good to miss. Take equity plus savings and blow the lot, er sorry, invest in housing.

Lots of people did it. Do you think everyone could suddenly actually afford to buy a 4 x 4? Borrowed money.

Now the gearing kicks in the other way. Borrow 10k to lose 50k.

For those who say "be fair, think of the poor unfortunates" let me say this isn't an Agony column or Homes and Gardens forum. It's about cold hard investment decisions, the state of the economy, and from the roots of this board it's about house prices.

Ok, maybe we could agree on half and half

Still means a lot of unfortunate people out on their ear due to unfortunate circumstances.

ess0two

Dan: wrote: »

Only through a lot of hard work.

Why do poeple assume it is a god given right to own a house?

If you don't earn enough, you can't buy a house, simple - This is not something new, it has always been the case.

Yeah i'm annoyed also some guy in my street has a ferrari,why cant i have one.

mp2

Dan: wrote: »

Only through a lot of hard work.

Why do poeple assume it is a god given right to own a house?

If you don't earn enough, you can't buy a house, simple - This is not something new, it has always been the case.

not to this extent.

its ridiculous when someone in london needs to be earning 100k a year to get a big enough mortgage to buy a crap home in areas as bad as hackney.

if the average person cant afford an average house then how does the market work? it cant.

whathavewedone

Hackney isn't considered to be a bad area any more than Islington is. That's why so many bars etc have sprung up there. Victoria Park's been sought after for years. If you want to live in Zone 1 you're going to have to pay.

You certainly don't need to be earning fortunes to live in areas like Leytonstone or Plaistow/Canning Town. What about Streatham/Brixton/Peckam? Don't tell me people have to earn anywhere near 100k to live in those places or numerous other parts of London.

mp2

whathavewedone wrote: »

Hackney isn't considered to be a bad area any more than Islington is. That's why so many bars etc have sprung up there. Victoria Park's been sought after for years. If you want to live in Zone 1 you're going to have to pay.

You certainly don't need to be earning fortunes to live in areas like Leytonstone or Plaistow/Canning Town. What about Streatham/Brixton/Peckam? Don't tell me people have to earn anywhere near 100k to live in those places or numerous other parts of London.

well look at leytonstone in right move. the average 2 bed house is around 225k.

how much do you need to earn to get a big enough mortgage? around 50k.

what about the beautiful brixton. a 3 bed terrace is about 350k on average. you only need to earn 88k a year to get one here.

Dan:_4

mp2 wrote: »

if the average person cant afford an average house then how does the market work? it cant.

FTBers shouldn't be able to afford an average house (unless they earn above average salarys). They should be able to afford a below average house and build up over the years.

This is how I done it, my parents done it and my grandparents done it. Why do you expect it so easy?

mp2

Dan: wrote: »

FTBers shouldn't be able to afford an average house. They should be able to afford a below average house and build up over the years.

This is how I done it, my parents done it and my grandparents done it. Why do you expect it so easy?

define below average. how much lower than average can you get to a 2 bed terrace.

also im not saying it should be easy. im telling you that the market cant support it. there is a difference. the fundamentals of the market dictate that it cant be supported.

over the long term, its impossible for any market to make abnormal profits. individuals can, an entire market cannot.
at the end of the day we are all pitted against each other so it is to a certain extent a zero sum game.

how can a stock market boom 100% when the real economy is growing 2.5% each year? it cant, which is why it always crashes back down again.

any market will always go back to equilibrium because it must, which is why you must always get out during the booms.

btw i can buy at any time but im just not that bothered, i know the difference between price and value.

Dan:_4

mp2 wrote: »

define below average. how much lower than average can you get to a 2 bed terrace.

also im not saying it should be easy. im telling you that the market cant support it. there is a difference. the fundamentals of the market dictate that it cant be supported.

over the long term, its impossible for any market to make abnormal profits. individuals can, an entire market cannot.
at the end of the day we are all pitted against each other so it is to a certain extent a zero sum game.

how can a stock market boom 100% when the real economy is growing 2.5% each year? it cant, which is why it always crashes back down again.

any market will always go back to equilibrium because it must, which is why you must always get out during the booms.

Below average will vary between individuals. Below average may be a 2 bed terrace for someone, and a 1 bed flat to someone else. Other factors include area - the chances of buying in the area you desire are slim for FTBers. Using myself as an example again - my first flat was in a crappy part of town, now im finaly in the area I wanted to be all those years ago.

What do you mean by "always get out during the boom years" I hope your not suggesting I should have uprooted my family into rented accomendation before my house value falls?

ukcarper

Prices have got out of hand but I couldn't buy an average 3 bed semi as a FTB on average wages in the early 70s and I don't think there have been many time since when a FTB on average could. How much below average they should be able to afford is I'm not sure but itt should be more than a one bed flat a 2 bed terrace sounds ok to me.

ukcarper

[Originally Posted by Dan
What do you mean by "always get out during the boom years" I hope your not suggesting I should have uprooted my family into rented accomendation before my house value falls?[/quote]

Some people seem to forget we are talking about homes