450k for a three bed flat-madness ! Now these people face ruin.

FungusFighter

Cleaver wrote: »

Very good points Graham, and I apologise in advance if I come across as harsh, but that's life isn't it? Whether it's buying a house, car, clothes, TV, insurance or pretty much anything else, there will be companies and individuals ruthlessly trying to convince you that you have to buy their product or service. And it's up to everyone else to use their head and consider if they want their product and service.

If you've got to the point in life where you have a £30k - £50k deposit (which the people in the article had), you assume they have had some life experience which should make them aware of this.

I'm not trying to talk down to you by the way, I've been sold plenty of things and then thought weeks, months or years later, "why the f**k did I buy that". Fortunately, it was small things that I just didn't give enough thought to, not a £300k property.



But that isn't true. These people had £30k - £50k deposits, which would be 20% or 30% deposits for big houses in Woolwich. At that time lenders would have been biting their hands off.



Completely agree with that one. But that 'ramping' and 'art of selling' has been happening since the Arabs sold fruit from their souks and will happen until land and property is being sold on Mars. The world over, right now, billions of people are being sold stuff they don't want or need and it's up to them whether they buy or not.

And your quote "fesh generation who didn't know much" is rubbish. Each generation tends to know as much or as little as the last generation. You're buying a house for christ's sake, do a bit of research.

I think you forget the sheeple effect ie if everyone else is doing it then I should do it too. 90% of people are thick and go with the flow - it has ever been thus mate. Blame genetics and bad environment, the loss of cautiousness or a culture of greed, they were just doing what their programming told them to do:D

fc123

Graham_Devon wrote: »

It's this which really gets to me. Where else should they have bought chucky? A nice victorian detached?

They had little choice unless they wished to rent for what they saw as the rest of their lives.

I know one of the developments in the article well.
Locals were amazed at the prices being asked but many buyers weren't local. They could have bought a 'nice Viccy semi' (not many detached in area) for a lot less at peak.

Everything has a risk in life and these people bought off plan not quite seeing the risks involved......so that is their problem IMHO. Personal guarantees and contracts etc...they should have done their research prior to signing up on the downsides of the deal as well as the ups....

baileysbattlebus

Graham_Devon wrote: »

Just strikes you how it's the young who are paying the price. They probably had advice of "buy now or you will never get on the ladder"...I know I did, but chose not to buy out of my depth, hence SA.

You don't get 20 something landlords in general, you just get these people facing financial ruin while the generation before them tried to hoard money for their own children, while financially ruining their peers children to try and do it.

I'm sorry Graham I have to disagree with you - the properties these people were buying were not normal flats - they were executive apartments - aimed at "lifestyle" buyers. It also looks as if most were not first time buyers - the 2 sisters raised the deposit by remortgaging or mewing a flat. Another one already had a one bed flat but wanted a 2.

I am sympathetic to them, to a degree.
Caspian Wharf - where some of them are buying - just look at the prices - I know it's London and prices are higher than most other places. But I'm sure there is better value property around than these.

http://www.berkeleyhomes.co.uk/index.cfm?articleid=1594&articleaction=availability

I am in my mid 50's and most people I know have actually lived in their houses a long time, they were bought as family homes - not as something for equity to be extracted from to finance our childrens' home owning aspirations.

I would imagine most people who owned property during the last crash ended up very wary about property. We did - and this recent bubble in prices has largely passed us by. I wouldn't know what our house is worth or what it was worth at the peak. I will find out what it worth the day we come to sell it, until then it's irrelevant. We won't be remortgaging anytime soon - we just have a few years left on the mortgage - it wouldn't be worth the hassle.

The only time our children will get any money from our house is when we die - by that time we will have down sized to something much smaller and therefore worth much less. And hopefully we will have had a pretty good time spending the proceeds (if there are any) ourselves.

To me a lot of this was caused by artifically low inflation figures, artificially low interest rates, which kept wage inflation low too, and easy lending. And ofcourse the media - one of the first shows around that I remember was Changing Rooms - which was changing your own house - then there was a whole raft of programmes promoting property speculation of one sort or another.

I don't remember any programmes like during the last crash, there could have been ofcourse. My viewing habits have probably changed. All I remember are people on tv who were either repossessed or in negative equity and stuck in a 1 bed flat with a baby.

And at the end of the day human beings are like animals - we follow the herd. If we think everyone is buying property, then we want to buy it too - you think you are missing something, like the boat, if you don't.

We will probably end up with the generation after yours thinking it is their birth right to own property. And it may just be cheap enough for that to be true.

mewbie_2

julieq wrote: »

Have you not come across black credit cards Mewbie? They're wonderful, stupidly elevated monthly fee and you get loads of great services like, err, black plastic and err a unique personalised 16 digit number.

e.g.

http://www.rbs.co.uk/private/loans-cards/g2/black.ashx

Wow. Love the black. And 24/7 Personal assistant. Plus er. airport something and European breakdown.

But. Bit of a letdown. It says RBS on it. Aren't they a bit rubbish? They should leave the name of the bank off it, or choose a different name.

Didn't there used to be one called Goldfish? That's just stupid.

I'd like mine to say Bond, or Bourne. But not Wimpey.

Graham_Devon

PasturesNew wrote: »

For the discussion of "what else could they buy"...

In E14, 44/100 properties that completed in about August 2006 were under £250,000.
http://www.houseprices.co.uk/e.php?q=e14&s=4151&n=100

On a monetry figure yes.

I tried to buy a place for 199k. I could not. However, I could sign on the line for a 245k flat.

Thats the difference.

They probably could not buy those places, no one willing to lend, but could buy the flat, as a man said you could.

Thats the point.

dfh

When the credit crunch started,Banks almost stopped lending on new builds.I suppose in some way that also speaks about the quality and actual value of these new builds.

Sapphire

Turnbull2000 wrote: »

Basing your perception of property investing on the 'trendy', wealthy young couples you see on Location, Location, Location is not the brightest idea. Out in the real, non-televised world, the majority of investors are over 40. And many of our young people are heavily in debt because these very same over 40's decided that education is no longer free.

This is simply incorrect. At the height of the property boom, wherever one turned in the 'real' world young people were talking incessantly about buying property as an 'investment' – this extends to people in my publishing offices in their twenties. The majority of people I know who are in their 40s or more have lived in the same property for 20 years plus and were not sucked into gambling on property.

I don't know who you mean by 'these very same over 40's' deciding 'that education is no longer free'. Well, when those who are now over 40 were at university-going age, far fewer people had the opportunity of going to university. Many would start at the lowest point in a company and work their way up over many years – actually the ideal way to gain experience and knowledge about a career. Unfortunately, most school leavers nowadays would consider it beneath them to start right at the very bottom of a company on a very low wage.

It stands to reason that if far more individuals want to go to university, taxpayers cannot be expected to support them – in fact it would be impossible.

Unfortunately, this 'government' decided that giving everyone such an 'opportunity' would win votes, and it encouraged people to go to college as a default option even when it was patently obvious that there would be limited jobs in many disciplines (for example media studies), and that some people were unsuited for a university education. By doing so it both served these people very badly, and in general managed to lower the education standards by a great degree.

I think you need research how people of your hated 'over 40s' generation lived when they were younger more deeply before pronouncing on this subject, as you seem to do at every opportunity. They generally had far less than young people do today (in terms of material wealth), had fewer aspirations to surround themselves with material things, and bleated far less about how unfair life was to them. They just got on with life and enjoyed themselves far more on much less money.

MyLastFiver

Unfortunately, most school leavers nowadays would consider it beneath them to start right at the very bottom of a company on a very low wage.

Not true. Being a teacher I know a lot of school leavers. They take whatever they can get. In the past, there were far more non-graduate jobs with prospects. These days, most non-graduate jobs are going nowhere.

A handful of my ex-students have gone on to do apprenticeships, working for years on low wages in order to qualify. I admire their work ethic and their sticking power. Unfortunately there are not enough apprenticeships for every school leaver who wants one. For the rest of them, call-centres and chain stores beckon. How depressing.

Sapphire

MyLastFiver wrote: »

Not true. Being a teacher I know a lot of school leavers. They take whatever they can get. In the past, there were far more non-graduate jobs with prospects. These days, most non-graduate jobs are going nowhere.

A handful of my ex-students have gone on to do apprenticeships, working for years on low wages in order to qualify. I admire their work ethic and their sticking power. Unfortunately there are not enough apprenticeships for every school leaver who wants one. For the rest of them, call-centres and chain stores beckon. How depressing.

This may be the case in your experience – however, I do know of graduates who will not go into employment at a very low wage, unless it is for a relatively prestigious outfit like the BBC. But they are people who live with their parents and can perhaps do the odd bit of freelance work (which is good experience in itself). They also don't have aspirations to buy property or engage in a high-spending lifestyle.

Having said that (and to contradict myself), there are indeed some graduates, for instance in my workplace, who are receiving work experience by working for nothing here and there. The people who do this are actually managing to find relatively good jobs after getting the work experience. Unfortunately, there are just too many graduates for some professions – a big problem.

I think that it is a great pity that most non-graduates are going nowhere. This never used to be the case. What a terrible waste.

PasturesNew

Teachers used to just need 2 A levels and pop off to Teacher Training College for a couple of years.

Now you need a degree to make sandwiches in a cafe... and that's a caff, not a caf!. Edit: (it doesn't like the e with the accent over it!)