Would I lose out if I get OFF the property ladder for a while

Gwhiz

freeride wrote: »

So thats why your so upbeat about house prices falling, you sold at the height and your renting.
£2000 per month over a year, thats £24000 plus. Sounds like you have spent any profit you made on the housing market.
If you rent for another 12 months, thats......£48000 plus.

I bet your praying houses fall another 10%.....LOL

I'm neither upbeat, or donwnbeat - just looking at the housing market, the economy in general and prospects for next 12 months.

I sold because I thought the drops would happen, not because I wished them to happen.

My ex-house has been valued by local EA's at about £150K less than I sold it for, and the land I am looking at is now around £100K less too so I'll be safe for a while thanks

GDB2222

freeride wrote: »

£500,000 mortgage?. Get real.

Umm, why not? Just because you are not in that debt league does not mean other people aren't. If the OP is renting a place for £2k a month, I very much hope it's worth at least £500k.

Gwhiz

GDB2222 wrote: »

Say someone has a £500k mortgage at 5% interest, then interest only repayments are £25k, ie enough to pay the rent, and there's a saving on insurance and maintenance. If house prices fall, that's the icing on the gingerbread.

That's quite a large mortgage, but someone who is happily renting at £2k a month may have had that size of mortgage.

I had no mortgage. To be honest if I cannot find a plot in the next 6 months I'll find a cheaper rental (if I move 10 miles North into the countryside I can get something nice for around £1200) as I prefer not to pay out too much if possible as any sensible person would.

However - the point I was making, and which seems to have gotten lost in the examination of £££££, is that renting can be a very positive experience. It's like in all walks of life - bad news travels fast and loudest. I was just trying to balance up the view with my own experience.

freeride

Gwhiz wrote: »

I'm neither upbeat, or donwnbeat - just looking at the housing market, the economy in general and prospects for next 12 months.

I sold because I thought the drops would happen, not because I wished them to happen.

My ex-house has been valued by local EA's at about £150K less than I sold it for, and the land I am looking at is now around £100K less too so I'll be safe for a while thanks

To be honest I think you was brave to have a go and I hope you get your rewards, BUT.

My point is, After renting for 2 years plus, you will have spent, lets say, a minimum of £50K. To get back on the housing market your looking at possible higher Interest rates, fees, stamp duty, solicitors fees, moving costs, set up costs (phone, gas. etc.) and stress.

Also, If the housing market doesn't drop by your predictions any time soon, you'll be paying rent for longer. Perhaps the saving won't be a big as you think.

freeride

GDB2222 wrote: »

Umm, why not? Just because you are not in that debt league does not mean other people aren't. If the OP is renting a place for £2k a month, I very much hope it's worth at least £500k.

Worth £500,000.

Not £500,000 mortgage, otherwise it would be a 100% mortgage.

Gwhiz

freeride wrote: »

To be honest I think you was brave to have a go and I hope you get your rewards, BUT.

My point is, After renting for 2 years plus, you will have spent, lets say, a minimum of £50K. To get back on the housing market your looking at possible higher Interest rates, fees, stamp duty, solicitors fees, moving costs, set up costs (phone, gas. etc.) and stress.

Also, If the housing market doesn't drop by your predictions any time soon, you'll be paying rent for longer.

I understand what you are saying but I don't require a mortgage so interest rates are irrelevant. I'm buying a plot of land not a house so my stamp duty is on a much lower figure and will therefore not hit the 4% level. Moving costs etc are not important to me as building my own home has been a 10 year dream and so any "hassle" is actually not important to me.

I have already "made" around £250K through the drop in my old house and the drop in the land I am buying so I would need to rent for at least 13 years (assuming I rent at £1200 in 6 months time) so the numbers work for me.

Of course these numbers and hassles may not work for others - we are all different.

Edited to say that future drops are not important either. I have seen adequate drops already so will buy as soon as I find the right plot. Even I am not crazy enough to think I can call the bottom (although I do believe we have another 10% to go at least) and I want to stay put for 10 years after moving too many times!!!

freeride

Gwhiz wrote: »

I have already "made" around £250K through the drop in my old house and the drop in the land

I'm lost. How have you made £250K?.

Are you going to buy your old house back at the reduced value?.
What about the land. How can you make money on something you've never owned?

Gwhiz

freeride wrote: »

I'm lost. How have you made £250K?.

Are you going to buy your old house back at the reduced value?.
What about the land. How can you make money on something you've never owned?

See my earlier post.

The house I sold has reduced by £150K so that's money I would NOT have in my pot right now had I not sold when I did. Added to that land prices have dropped and the ones I am looking at by around £100K. So in total £250K difference.

I know it's not exactly right but you see where I am coming from!

freeride

Gwhiz wrote: »

See my earlier post.

The house I sold has reduced by £150K so that's money I would NOT have in my pot right now had I not sold when I did. Added to that land prices have dropped and the ones I am looking at by around £100K. So in total £250K difference.

I know it's not exactly right but you see where I am coming from!

Your making this up as you go along.:rotfl:

If and when you buy the land, it will only be worth what you have paid for it. It doesn't matter what the value was 1 year, 5 years or 10 years ago, you didn't own it then.

Gwhiz

freeride wrote: »

Your making this up as you go along.:rotfl:

If and when you buy the land, it will only be worth what you have paid for it. It doesn't matter what the value was 1 year, 5 years or 10 years ago, you didn't own it then.

It does sound like I'm making it up :rotfl:

Let's just say I am definitely better off right now than if I decided to sell right now. Who know what the future holds!!!

I think