House Price Crash

A_Fool_&_His_Borrowed_Mon

PoorDave wrote:

Hmm. Martin Lewis as Prime Minister?

All those in favour...

Even better, M. Lewis as chancellor of the exchequer! He'd soon get this country's finances ship-shape!:money:

biting_the_bullet

Just thought i'd add my two penneth's worth on this house price crash scenario.

I've offered recently on an detached house up for 250K. After the old https://www.ourproperty.co.uk advice, i found the current owners paid 245K for the house just back in December 2004. This was the height of the increases round here locally.

Anyway, i'm told the house could be ours for 230K. But now i'm thinking, hang on, depite the vendors taking a 15K hit as well as spending 10K on it in the mean time, whats to say it won't be worth 210K in a few months. Money better off in my pocket than theirs.

This price correction thing, I think its already started round here. But how far will it go, now thats the question........................

AndrewSmith

RHemmings wrote:

I'd say that the vast majority are economising, through necessity rather than choice. Perhaps you're misinterpreting the "lifestyles" pushed on television as what real people do.

Appreciate that in my line of work I meet vast numbers of exactly the type of people we are discussing here and, based on my own experience and that of my collegues etc, I am most definately not misinterpreting anything.

I have lost count of the number of times I am asked by FTB and second time buyers come to that, if they can effect a 100%+ mortgage to buy new furniture for the house or a new car etc etc.

I therefore stand by what I said as I feel I speak from an experienced standpoint with extensive knowledge of the situation.

tomstickland

Sounds morbidly fascinating. A lot of people are only concerned with what they can have and not whether they can really afford it or not.

RHemmings

AndrewSmith wrote:

Appreciate that in my line of work I meet vast numbers of exactly the type of people we are discussing here and, based on my own experience and that of my collegues etc, I am most definately not misinterpreting anything.

I have lost count of the number of times I am asked by FTB and second time buyers come to that, if they can effect a 100%+ mortgage to buy new furniture for the house or a new car etc etc.

I therefore stand by what I said as I feel I speak from an experienced standpoint with extensive knowledge of the situation.

I think we then need to clarify exactly what sort of people we are talking about. Previously you said

The majority of people setting up homes these days are not content with anything less than brand new. It is the fault of the materialistic society in which we live.

In which case I'd think that the people buying and setting up homes these days are a bit more "that way" financially than the population in general. Or the kind of people I know and meet are less "that way" financially than the population in general. I have a colleague who recently set up in a new flat. He was telling me about all the cheap places to buy discount furniture. I myself know of some charity shops which have quite nice furniture. Not brand new, but reasonable looking. And about £80 for a three piece suite. £5 delivery. And the cash would go to charity. But returning to the topic, it does seem that the people I meet are not spendthrifts of the type you describe. I think you're meeting different people.

While I have to be careful about what I say as many people here have recently bought houses, I believe that for many people buying a house at current prices is not financially prudent. Perhaps this means that the small proportion, compared to previous levels, of FTBs that still buy are not just the few able to afford houses and property, but also the least financially prudent members of society.

RHemmings

A_Fool_&_His_Borrowed_Mon wrote:

Even better, M. Lewis as chancellor of the exchequer! He'd soon get this country's finances ship-shape!:money:

Martin Lewis for benevolent dictator of the world. And can we have Kirsty, Phil, and the rest imprisoned in the tower?

tomstickland

Sounds like you mix with financially savvy people. Most of the people I know from work are similar. They won't be impressed by a new car or a bigger house. They're just not into that sort of thing.
But there are hoardes of proper "consumerists" out there, who are the lenders dream. They don't care about how they finance something, they just want it all. I've seen people on another forum boasting about how much they borrowed for their house when they wanted to "upgrade". They really thought is was something to brag about.

RHemmings

tomstickland wrote:

Sounds like you mix with financially savvy people. Most of the people I know from work are similar. They won't be impressed by a new car or a bigger house. They're just not into that sort of thing.
But there are hoardes of proper "consumerists" out there, who are the lenders dream. They don't care about how they finance something, they just want it all. I've seen people on another forum boasting about how much they borrowed for their house when they wanted to "upgrade". They really thought is was something to brag about.

I couldn't resist being the one who thanked you for the 1000th time. Do I get a prize?

Now that I think of it, I do mix with people from particular backgrounds. I don't know anybody who owns one of those 4x4 monsters, and they're everywhere.

tomstickland

Thanks!

The people I know at work generally are degree educated in scientific type subjects, work hard, have varied interests and see quality of life and intellectual stimulation as more important than owning things.

When I think about it I realise that they are not typical of the rest of the country.

meanmachine_2

RHemmings wrote:

While I have to be careful about what I say as many people here have recently bought houses, I believe that for many people buying a house at current prices is not financially prudent. Perhaps this means that the small proportion, compared to previous levels, of FTBs that still buy are not just the few able to afford houses and property, but also the least financially prudent members of society.

That's a good point.

Look on the mortgages site and you'll see that almost every FTBer is looking for at least a 100% mortgage. When I suggest they should save a deposit, I'm attacked like I'm a mad thing, and that if they don't buy now then they'll end up in the gutter. Or words to that effect.

Sadly, these people are setting the new market value.