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First-time Buyer fear - Will house prices crash??
Comments
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desperadoV2 wrote:I'm a first-time buyer. I'm planning to borrow £160K on mortgages after my debt is closed.
My major fear is House price crash!! If I buy a house for 168K and if the interest rates goes upto 6-7% this year. Will the house price crash?
I hope it doesn't. If it does, how much my property will be worth (appx. figure). I know its hard to predict these things but I'm really worried the way the house price rise are going. At some point surely it has to stop. It cannot keep on increasing can it?
My situation is similar and it really worries me too. The area I am buying in is probably not going to be affected badly by any drops so I'm not too worried about that but it would annoy me to buy something today which I could pay less for tomorrow not to mention the reduced interest over the period of the mortgage. Unemployment is not going to be so much of an issue either so it all hinges on interest rates. I am borrowing a HUGE amount of money on an IO basis with virtually no deposit of my own as it is borrowed from family who can't really afford to lose the money if I default. Rates are low so where else can they go other than up? So I and my family would be very likely victims of an IR rise of 2%+ (which historically is not very much) and I would like to thank all the contributors on this post for bringing me to this informed realisation.
A house is for living in and I entirely agree on buying it on that basis rather than speculation but anyone in my position should be very wary of what can and HAS happened before. Whether to buy now or not is really down to your personal circumstances and the question is how far are you stretching yourself to buy?
I would rather not stretch myself so far as I thought after reading this.
The 'live for today' people on this forum are probably sitting on oodles of equity and can afford to be flippant. I can't and that's the reality.0 -
Don't forget about the Buy to Lett brigade stampeding for the exit ! As they have exaggerated the price gains then likely they will also exaggerate the price decline somewhat, so it will probably be worse than last time !
Just my guess...
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