Housing market drop

Doozergirl

Jay1b wrote:

There was 30500?? successful applications... Lots more are currently in progress. ,

:wall: No. There were 30,500 applications in total. Why twist what I say to fit your story? http://news.bbc.co.uk/1/hi/world/4814598.stm

Asylum seekers have no impact on the housing market at all. Those 'net' 166,000 immigrants coming in are mostly paying their own way. If that number is right, then if you take the figure of 360,000 Britons leaving last year, using your own argument, means that 150,000 more people moved out than moved in last year. So if your theory made any sense at all, house prices would be dropping, wouldn't they?

Or am I twisting what you say to fit my argument? :rolleyes:

Jay1b

Erm... one question, why are you making such a big deal of it?

Either way, if its 360,000-30500 = 329500, or 360,000-0 = 360,000 - thats 30500 less houses then there would of been. Its not a big impact, but a slight consideration, last year clearly had lower immigration levels then the past 6 years then, assuming the bbc figures arent massaged.

I cant see that your taking the direction of the thread in a manor that will help the OP, so i'm not going to get into an argument over something so petty or pointless, especially as i'm at work and kind of busy.

Alleycat

I have to agree to a certain extent with Jay. Migration will and does have quite an impact in certain parts of the country on its housing stock. It is not just asylum claims, but family reunions, overseas marriage etc. A lot of the migration in my city is from asylum seekers who once granted leave to remain do have to live somewhere, get a one bedroom flat, then apply for a family reunion therefore requiring rehousing into often 3 or 4 bedroom houses, asian arranged marriages overseas who then start a family in the UK, bring relatives over such as parents, grandparents, there has been a massive influx of Eastern Europeans into Bradford over the past year since the Accession countries joined the EU. This all has a detrimental impact of the availability of affordable housing forcing more people into private rented/overcrowding etc. Over the past three years, Bradford (and I am sure it is not just here) has experienced a growing shortage of housing stock.

Sorry, I know this is kind of OT, but just felt it needed to be said.

I'll creep back into my box now!

Doozergirl

Jay1b wrote:

Erm... one question, why are you making such a big deal of it?

I can't speak for the others but I am making such a big deal out of it because I found your comment offensive. I chose to reply in order to try and provide evidence to the contrary.

I apologise to the OP for taking the thread OT. My job is here at home and I have nothing better to do as I'm not getting paid to be doing something else whilst I'm spending time on here.

homer_j_3

Getting the post back on track to the OP. I believe that there are so many different factors involved with regards to all of the arguments made and this is what makes it a nice topic to discuss.

If you feel that the situation is right for you to sell and rent then that is fine and you seem to believe that you are making financial savings by doing this then that is fine.

There are many countries in the world that would not believe how we british are so obsessed about owning our own house, car etc. As one contibuter to this post said, in this country renting gives you a lot less flexibility in terms of making your home your own due to the mindset of landlords, tennants and the legal agreements that are commonly found. I believe that in some european countries it is not unusual for tennants to pay for brand new kitchens etc to make their home their own. I am not sure how that would sit over here especially as it is not unusual to be only guaranteed a minimum 6 month residency in a property through a shorthold tennancy agreement.

Anyway, if you are in the position of owning (with or without mortgage) then you are clearly in a position of envy to many who are struggling to get on the property market and many people want to come onto the market because of the reasons provided above surrounding the inflexibility of renting.

If you look at both renting and buying in terms of an investment then I cannot immediatly bring to mind any situations where you will be worse off by buying over renting. If you take like for like payments towards rent and a mortgage, I believe that you will be getting more for your money in terms of size, location etc on the property you have bought over the one you would rent.

If you were to rent for 25 years and pay a mortgage for 25 years and you are paying the same amount, then you have an asset to show for the 25 years of payments. Regardless of how much that asset is valued, it is still better then having nothing at the end of the term and with no debt against the property, any sale would be pure profit unless fees outweighed value :rolleyes: .

If you are saying that renting will cost you less per month then I would suggest that you either look at remortgaging to a better deal or consider downsizing to establish a similar payment with the fact that you will still remain on the property ladder etc.

The 15 % interest rates in the 80's/90's were a contribution of economic conditions including the stock market crash, high redundancies with the minors etc and general economic stability of the country. All of this contributed to interest rates going up, house prices going down not house prices getting too expensive. In my opinion I do not believe that the economy at the moment is showing signs that we are at the point of bursting yet.

So if you look at the situation of jumping ship now because you beieve that we are on the crest of the wave with house prices and investing in shares then I would seriously ask you to question your logic because shares are at a fair high at the moment and your investments are in a more volatile market than property.

Put that with the fact that you will most likely be spending the same or if not more on a property to rent then you could risk losing your investment in the stock market and finding yourself with reduced savings and no property as an asset when the mortgage would have been repaid.

If you are losing your nerve of house prices droping by 10% and are not prepared to sit through the cycle, should your predictions come true that is, then I would not recommend that you invest in the stock market.

devils_advocate

Quote:If you look at both renting and buying in terms of an investment then I cannot immediatly bring to mind any situations where you will be worse off by buying over renting. If you take like for like payments towards rent and a mortgage, I believe that you will be getting more for your money in terms of size, location etc on the property you have bought over the one you would rent.
END Quote

can you tell me areas in which this holds true? In my area of south London, with 3 or 4 bed semis, rents seem to have stayed around the same for the past 4 or 5 years. Prices haven't!

John_M_Business

I also believe that in the short term you definitely LOSE in terms of purchasing because of all the costs associated with buying.

Additionally, if the house prices do not grow by more than 4% PA, then you're better off taking what savings you have and investing them wisely, and sticking with renting... obviously!

meanmachine_2

John, are you surprised by how perky the London market is right now?

In a world of its own - but not as otherworldly as Dublin, which is seeing 30%pa HPI. It really is all going to end horribly, especially for the Irish, now that int rates are on the rise there.

The problem is, there's always a time lag with int rates, so the people keep rocking, even when the music's stopped.

The other problem is that I suspect there's still a lot more inflation in our own market before things reach tipping point.

People in this country, I feel, actually want to spend at least half their earnings on property, like it's some badge of honour.

Ker-razy.

homer_j_3

devils_advocate wrote:

Quote:If you look at both renting and buying in terms of an investment then I cannot immediatly bring to mind any situations where you will be worse off by buying over renting. If you take like for like payments towards rent and a mortgage, I believe that you will be getting more for your money in terms of size, location etc on the property you have bought over the one you would rent.
END Quote

can you tell me areas in which this holds true? In my area of south London, with 3 or 4 bed semis, rents seem to have stayed around the same for the past 4 or 5 years. Prices haven't!

Ok - apologies for my geographic lack of knowledge about the housing market in the the South of London, however, my point was that it normally is not the case accross the country as a whole.

I know London has been a bit turbulent over the past few years but if you are already on the property ladder, as the OP is, then I would imagine with the right mortgage deal and the benefits of owning an asset at the end of the mortgage, you will be better off keeping a mortgage over jumping ship to get a rental property and the costs will not be that different.

Clearly if you are not on the property ladder already then you are probably correct that with lack of deposit and a high loan to value, you may end up paying more but that wasnt my claim.

If everybody starts jumping ship then rental prices will start to go up also due to demand at some point, however, I am not sure how likely or how realistic that would be at this stage.

devils_advocate

homer_j wrote:

I know London has been a bit turbulent over the past few years but if you are already on the property ladder, as the OP is, then I would imagine with the right mortgage deal and the benefits of owning an asset at the end of the mortgage, you will be better off keeping a mortgage over jumping ship to get a rental property and the costs will not be that different.

Clearly if you are not on the property ladder already then you are probably correct that with lack of deposit and a high loan to value, you may end up paying more but that wasnt my claim.

So are you saying that someone who rents a 400k house is paying the same out per month as someone who buys that same house on a 300k mortgage?

Please do let me know (pm me even!) to locations in the UK where the cost of renting is the same as the cost of a mortgage. I haven't found any.