12 reasons to not buy a house

robmatic

AndyGuil wrote: »

It is falling even more so in real terms, but falling regardless anyway.

Falls in real terms are irrelevant in terms of loss of equity.

Falls of approx. 1% per year in nominal terms mean that rental yield has to be less than 100 basis points bigger than the mortgage rate for savings to be made.

AndyGuil

robmatic wrote: »

Falls in real terms are irrelevant in terms of loss of equity.

Falls of approx. 1% per year in nominal terms mean that rental yield has to be less than 100 basis points bigger than the mortgage rate for savings to be made.

Take out wear and tear costs, and insurance etc. Then consider a drop of around 5% as predicted for this year then it looks very good. The economic woes are weighing on this market and are about to get worse like nothing seen before. The risk to homeowners is great as a result. The market is still correcting. Not all properties fall the same amount. You do well if you have a very high value property in London but the lower value properties have fallen tremendously (even then these properties are getting hit).

London YoY: http://www.home.co.uk/guides/house_prices_report.htm?location=london&lastyear=1
Birmingham YoY: http://www.home.co.uk/guides/house_prices_report.htm?location=birmingham&lastyear=1
Manchester: http://www.home.co.uk/guides/house_prices_report.htm?location=manchester&lastyear=1
Southampton: http://www.home.co.uk/guides/house_prices_report.htm?location=southampton&lastyear=1
Winchester: http://www.home.co.uk/guides/house_prices_report.htm?location=winchester&lastyear=1
Oxford: http://www.home.co.uk/guides/house_prices_report.htm?location=oxford&lastyear=1
Bristol: http://www.home.co.uk/guides/house_prices_report.htm?location=bristol&lastyear=1

ukcarper

AndyGuil wrote: »

Take out wear and tear costs, and insurance etc. Then consider a drop of around 5% as predicted for this year then it looks very good. The economic woes are weighing on this market and are about to get worse like nothing seen before. The risk to homeowners is great as a result. The market is still correcting. Not all properties fall the same amount. You do well if you have a very high value property in London but the lower value properties have fallen tremendously (even then these properties are getting hit).

London YoY: http://www.home.co.uk/guides/house_prices_report.htm?location=london&lastyear=1
Birmingham YoY: http://www.home.co.uk/guides/house_prices_report.htm?location=birmingham&lastyear=1
Manchester: http://www.home.co.uk/guides/house_prices_report.htm?location=manchester&lastyear=1
Southampton: http://www.home.co.uk/guides/house_prices_report.htm?location=southampton&lastyear=1
Winchester: http://www.home.co.uk/guides/house_prices_report.htm?location=winchester&lastyear=1
Oxford: http://www.home.co.uk/guides/house_prices_report.htm?location=oxford&lastyear=1
Bristol: http://www.home.co.uk/guides/house_prices_report.htm?location=bristol&lastyear=1

Not to impress with those links did detached houses in Winchester really go up 22% last year?

According to land reg. the average terrace house In Hampshire lost £2.5k last year it would have cost you £9k to rent same house.

In Surrey the drop was less and the rent more.

AndyGuil

ukcarper wrote: »

Not to impress with those links did detached houses in Winchester really go up 22% last year?

According to land reg. the average terrace house In Hampshire lost £2.5k last year it would have cost you £9k to rent same house.

In Surrey the drop was less and the rent more.

There are some spikes as it is a YoY for each type of property so less averaging. I would ignore extreme values and assume they are positive or negative values. The smaller values are more representative. It really depends on the value of the property as to the gains or losses.

It depends on the area and property value. You will always pick up volatility like this too.
3 month changes:
London: http://www.home.co.uk/guides/house_prices_report.htm?location=london&startmonth=09&startyear=2011&endmonth=11&endyear=2011
Birmingham: http://www.home.co.uk/guides/house_prices_report.htm?location=birmingham&startmonth=09&startyear=2011&endmonth=11&endyear=2011
Manchester: http://www.home.co.uk/guides/house_prices_report.htm?location=manchester&startmonth=09&startyear=2011&endmonth=11&endyear=2011
Southampton: http://www.home.co.uk/guides/house_prices_report.htm?location=southampton&startmonth=09&startyear=2011&endmonth=11&endyear=2011
Winchester: http://www.home.co.uk/guides/house_prices_report.htm?location=winchester&startmonth=09&startyear=2011&endmonth=11&endyear=2011
Oxford: http://www.home.co.uk/guides/house_prices_report.htm?location=oxford&startmonth=09&startyear=2011&endmonth=11&endyear=2011
Bristol: http://www.home.co.uk/guides/house_prices_report.htm?location=bristol&startmonth=09&startyear=2011&endmonth=11&endyear=2011

ukcarper

AndyGuil wrote: »

There are some spikes as it is a YoY for each type of property so less averaging. I would ignore extreme values and assume they are positive or negative values. The smaller values are more representative. It really depends on the value of the property as to the gains or losses.

Why not just look at Land Reg. and get a more accurate picture unless I’m mistaken the figures you link to are just a raw average of property sold that month.

AndyGuil

ukcarper wrote: »

Why not just look at Land Reg. and get a more accurate picture unless I’m mistaken the figures you link to are just a raw average of property sold that month.

Yes they are volatile, but you can see the trend. This data will of course be on the land registry. You get great control on that website and seeing specific areas, properties and even postcodes is useful.

ukcarper

AndyGuil wrote: »

Yes they are volatile, but you can see the trend. This data will of course be on the land registry. You get great control on that website and seeing specific areas, properties and even postcodes is useful.

I think the sample is too small to be meaningful

AndyGuil

ukcarper wrote: »

I think the sample is too small to be meaningful

It gives you good idea for the market with specific criteria (date range, areas, properties and postcodes)

Colin297

The reality is:

Anyone on here, with any decent type of net worth, almost surely owns property or multiple properties.


If you can seriously, seriously tell me you're better paying rent, i.e. dead money, for a prolonged period of time, than pay slightly more per month to actually own a property to an an asset that will have significantly appreciated over 20+ years, then i must be missing sometihng.

Even as an investment - my brother just bought a house where he makes a PROFIT on the rent (after the monthly mortgage payment). Excellent investment.

Now owning = small time.

AndyGuil

Colin297 wrote: »

The reality is:

Anyone on here, with any decent type of net worth, almost surely owns property or multiple properties.


If you can seriously, seriously tell me you're better paying rent, i.e. dead money, for a prolonged period of time, than pay slightly more per month to actually own a property to an an asset that will have significantly appreciated over 20+ years, then i must be missing sometihng.

Even as an investment - my brother just bought a house where he makes a PROFIT on the rent (after the monthly mortgage payment). Excellent investment.

Now owning = small time.

Those that benefitted from the boom yes. Many haven't.