It can make a lot of sense to buy now.

ess0two

nembot wrote: »

Suggesting that todays prices are perfectly acceptable is something only someone with BTL properties or a huge mortgage would do....

So which one of the above is applicable to yourself?

Round my way,houses are perfectly priced,i've provided past rightmove links to stuff thats easily affordable.

Conrad

Housebear51 wrote: »

The reality is however many years of pain, I dont like it but thats just the way it is.

Thats what you would have said in 1979. By 1981, from being the Eurpean basket case, we had yuppies and loadsamoney.

It's all to easy to overdo negativity.

Conrad

Strings wrote: »

I do find it rather amusing that people want a further correction, when in 08/09 we had one.

.

It's typcial market behaviour. Bearish sentiment always overshoots on the way down just as overt bullishness overshoots on the way up.

The current property bear is a hostage to todays headlines, and not someone that has enough capacity to see through them on into say 3 years time.

Conrad

Emy1501 wrote: »

What is behind your opinion? Last year it seemed to be based on the facts that at the beginning of 2009 more and more buyers were signing up to the agents and business was getting better.

Speaking to a broker who was saying similar to you last year his impression is that there are few buyers out there and lots of new property coming onto the market in the EA’s he works from in the SE.

I understand the argument that buying on the way down is better than the way up but I can’t see any evidence or reason for an upturn until the beginning of next year at the earliest so if I was a FTB especially, I would be waiting until at least Sept-Oct as unlikely sellers will be taking lowish offers

A sensible post.

To be clear though, I'm not really expecting rises, I'm saying prices will not have fallen 1 year from now.

There won't be a better time to buy than now, going forwards, as you rightly point out there are more sellers than buyers and lots of gloom around but that can and probably will turn around quickly - I'm minded of the dozens of time we're told people have stopped shopping, only for 'surprise' retail sales rises to feature 3 months later.

Great time to get in and secure a DECENT property that simply may not be available to you in the near future, plus you can fix at lower rates now.

Blacklight

Conrad wrote: »

Great time to get in and secure a DECENT property that simply may not be available to you in the near future, plus you can fix at lower rates now.

This is key.

Prices may come down a bit but how long are lenders going to offer rates as low as they are now?

£100k at 5% is the same thing as £80k at 7%.

The tin foilers are betting on a 20% fall before lenders put rates up 2%*.

*lenders rates, not BOE base rate!

[edit] thinking about it, a lot of doom and gloomers are also betting on interest rate rises to cause prices to fall. That really doesn't make any sense. Paying more per month for something that's worth less that it was when you could have bought it ages ago and been paying off your debt earlier.

Hmm, now is a good time to buy.

Graham_Devon

Blacklight wrote: »

This is key.

Prices may come down a bit but how long are lenders going to offer rates as low as they are now?

£100k at 5% is the same thing as £80k at 7%.

The tin foilers are betting on a 20% fall before lenders put rates up 2%*.

Blimey, I thought I'd seen this place get desperate, but this took it to a whole new level.

"I know, I'll extend myself based on the current mortgage rate....im a bloody genius I tell yer....this could never go wrong".

Blacklight

Graham_Devon wrote: »

Blimey, I thought I'd seen this place get desperate, but this took it to a whole new level.

"I know, I'll extend myself based on the current mortgage rate....im a bloody genius I tell yer....this could never go wrong".

On the one hand you could buy now at incredibly low fixed interest rates. Worst case prices fall and interest rates go up. You're still no better or worse off at a 20% fall and 2% rise.

On the other hand you could wait for a 20% fall (or move to 'round my way') by which time interest rates would have gone up and you're no better off.

There is a risk however that if this 20% fall doesn't happen you'll be stuffed paying full whack at at a higher rate having missed the boat yet again.

It's not rocket surgery.

Graham_Devon

Blacklight wrote: »

On the one hand you could buy now at incredibly low fixed interest rates. Worst case prices fall and interest rates go up. You're still no better or worse off at a 20% fall and 2% rise.

Of course you are better off with the fall.

Let's take your 100k scenario @ 5%. Thats £591 per month.

Now, house prices fall 20%. Someone moves in next door to you, buying the exact same place as yours for 80k, but rates have risen 2%.

So their monthly payment on 80k @ 7% is £572 per month.

So they are no better off you say.

Well, apart from the fact that they don't owe a further 20k on the house like you do to make up your negative equity. Apart from the fact that your mortgage fix WILL come to an end after say 2-5 years, and then you will be paying £715 per month at 7% while your next door neighbour is paying £572 per month for the same thing. Apart from the fact that the further rates rise, the more and more you pay extra on top of what they are paying because your loan is bigger.

Yer, apart from all that, no difference.

:doh:

Blacklight

Graham_Devon wrote: »

Yer, apart from all that, no difference.

:doh:

Apart from during the five year fixed term you will have paid off about £15k of the debt thus lowering the repayments when your fixed term ends, enjoyed your own home for five years and not wasted £35,000 in rent...

It's a real gamble to sit on your hands and wait for a 20% fall just so you can say 'I told you so'.

Personally, if I was looking to buy now I'd gamble on prices not falling 20% with interest rates remaining at rock bottom and everyone keeping their job.

:doh:

nearlynew

You have to remember that all HPI cheerleaders are debt-junkies.


So to them, the more they have to borrow to buy a house, the richer they feel.


I know, I know it's ridiculous, but that's the way they think.