Own a house - you're working for nothing.

nearlyrich

des_cartes wrote: »

Well as you asked.

Lets assume your house is valued at 350k.

It's losing about 1% per month = about 3.5k per month.

You could probably rent it for about 1k per month

Your net loss is 2.5k per month.

Of course owning a house as others have said is not only about the financial implications, but as an answer to your question, I hope i have helped your understanding of the topic. Bearing in mind that UK houses have around 30% further to fall, your net loss from here could be around 75k. Fine as long as you do not need 75k, but for me when I sold 4 years ago, the potential saving I could achieve by selling at the top of the market and buying when prices fell was too good to miss.

So where can I put my equity to provide an income to cover the £1250 per month rent of a similar property ( but without some of the things that make living here my ideal home, the views, the neighbours, the great pub at the end of the road) without biting into the capital so I can rebuy once this massive crash has occurred?

I agree there is a bit of movement on prices around here ( north west as it happens) but it's the starter homes that went from £20k to £120k in a short number of years, people are realising that they can't sell an overpriced 2 bed to a couple on minimum wage which is why property prices are falling. I have lived on this road for over 30 years most of them in this house and this bit we live on (12 house in total) only two have changed hands in the last 17 years.

Running_Horse

toocan wrote: »

1) It would push millions of people into negative equity
2) It would effectively make the business of building new houses profitless

1) Like the early 1990s? It has happened not so long ago, and could happen again.
2) Recent history suggests they would just stop building until there was a profit in it again.

ukcarper

Running_Horse wrote: »

1) Like the early 1990s? It has happened not so long ago, and could happen again.
2) Recent history suggests they would just stop building until there was a profit in it again.

I think house prices only actually fell for one year in the 90s and then only by about a couple of percent.

MigsyBigsy

diable wrote: »

Nothing wrong with London.

there is nothing right with it too:(

diable

MigsyBigsy wrote: »

there is nothing right with it too:(

You mean the entertainment, night life, museums, art galleries, shows, concerts, diversity, variety of shops, bars, pubs, restaurants, the chances of finding work in various fields be it fashion, civil engineering etc etc etc

Tell me me why nothing is right with London, as it will have the same problems with gangs, drugs, homelessness as any other city in the UK.

mrcow

des_cartes wrote: »

but for me when I sold 4 years ago, the potential saving I could achieve by selling at the top of the market and buying when prices fell was too good to miss.

I am close friends with someone who used to talk just like you. Thought that he could second guess the housing market.

He lost everything he had. His house. His money. His business. And his wife and son walked out too. He thought he was being so smart at the time. Trouble was, he was gambling with what he could ill afford and ended up in a rental rut.

By the time he realised how stupid he been sounding, it was too late.

toocan

Running_Horse wrote: »

1) Like the early 1990s? It has happened not so long ago, and could happen again.
2) Recent history suggests they would just stop building until there was a profit in it again.

The drop in 2008 dwarfed that of the early 90's. In terms of the building industry are you saying it would just have to stop existing for x amount of years

HAMISH_MCTAVISH

ukcarper wrote: »

I think house prices only actually fell for one year in the 90s and then only by about a couple of percent.

Two years, and by 13%. They then stagnated for quite some time though, as supply was maintained throughout..... The builders hadn't learned their lesson.

They have this time.;)

This crash was slightly shorter, but much larger than the 90's crash, with prices falling by 23% on one measure.

HAMISH_MCTAVISH

mrcow wrote: »

I am close friends with someone who used to talk just like you. Thought that he could second guess the housing market.

He lost everything he had. His house. His money. His business. And his wife and son walked out too. He thought he was being so smart at the time. Trouble was, he was gambling with what he could ill afford and ended up in a rental rut.

By the time he realised how stupid he been sounding, it was too late.

Sadly, this is the case with all too many of these Sell To Rent gamblers.

No wonder des cartes sounds so desperate. STR in 2006 is a very costly mistake.

poppycod

HAMISH_MCTAVISH wrote: »

Sadly, this is the case with all too many of these Sell To Rent gamblers.

No wonder des cartes sounds so desperate. STR in 2006 is a very costly mistake.

The only person who has been demonstrably shown to be desperate on this forum over the last week or so is you.

Everyone has seen through you and recognises the propagandist at work.