Repo's up and some startling numbers

RenovationMan

geneer wrote: »

I was of course refering to those who, like myself, considered a housing crash inevitable. Would have thought that was obvious.

Well, I predicted it too, it was pretty obvious that the market was overheating. My missus saw a house she liked in 2005 and I talked her out of it citing an impending crash. I had to endure a couple of years of gentle mockery until I was proven right. We bought our new home in 2010, post crash and saved quite a bit of money.

How have you benefitted from your crash prediction?

geneer wrote: »

0.5% base rate = emergency measures.
Your benefiting from low mortgage rates is, by your own admission, nothing more than good fortune.

I bought our house in 2010, quite a while after the 0.5% base rate/emergency measures came in, so how did I manage to do a backward facing 'prediction'?

Instead I reasoned that rates would stay low for a long time and based the purchase of my new house on this reasoning. In Feb 2010 when I started the house move in motion I predicted that we would have 0.5% rates until May/June 2011 and so far I have been proven correct. Where is the 'good fortune' in this?

geneer

RenovationMan wrote: »

Well, I predicted it too, it was pretty obvious that the market was overheating. My missus saw a house she liked in 2005 and I talked her out of it citing an impending crash. I had to endure a couple of years of gentle mockery until I was proven right. We bought our new home in 2010, post crash and saved quite a bit of money.

Fair enough.

Though this can't be the same RM who argued with me on and on about how you shouldn't worry about timing markets and gambling with the family home and just get on and buy when you can.

You remember. The RM with that amazing anecdotal friend who berated himself for waiting out the crash and getting it ooooooohh so wrong.
http://forums.moneysavingexpert.com/showpost.php?p=42139518&postcount=34

Good job its not the same RM because at best you'd be utterly contradicting yourself, and at worst youd be a total hypocrite.

RenovationMan wrote: »

How have you benefitted from your crash prediction?

Buy not buying near the peak of a big old bubble.

RenovationMan wrote: »

I bought our house in 2010, quite a while after the 0.5% base rate/emergency measures came in, so how did I manage to do a backward facing 'prediction'?

Instead I reasoned that rates would stay low for a long time and based the purchase of my new house on this reasoning. In Feb 2010 when I started the house move in motion I predicted that we would have 0.5% rates until May/June 2011 and so far I have been proven correct. Where is the 'good fortune' in this?

Good stuff.
You're quite right of course. Low interest rates are quite good for anyone who buys before or after a crash.
Which makes it a strange thing to gloat about.

RenovationMan

geneer wrote: »

Fair enough.

Though this can't be the same RM who argued with me on and on about how you shouldn't worry about timing markets and gambling with the family home and just get on and buy when you can.

You remember. The RM with that amazing anecdotal friend who berated himself for waiting out the crash and getting it ooooooohh so wrong.
http://forums.moneysavingexpert.com/showpost.php?p=42139518&postcount=34

Good job its not the same RM because at best you'd be utterly contradicting yourself, and at worst youd be a total hypocrite.

I think you have highlighted the inherrent problem with a lot of bears; they simply do not understand risk. I stated that you should not gamble with your home by speculating on the movement of a market. This was in reference to someone like yourself who could have bought a house but decided not to because they thought there would be a crash. It was also aimed at people who sold their houses and rented in the belief that the market would crash and they would buy back in at a higher level. It was also aimed at people who desperately need to move and can afford a larger place but hold off buying in the hope that they can get somethign even bigger in a crash (in the case of my friend, he was in a tiny 2 bed FTB house with a growing family).

Let's look at the risk. The best case scenario is that they could get their house cheaper, the worst case scenario is that the market doesn't change and they are either priced out of the market (FTB), cannot even afford to buy a similar property to the one they sold (STR) or see the next rung of the ladder move out of their grasp and they have to stay put in a house that does not meet their needs or move to a cheaper area in order to afford a large enough place.

Contrast this to what I did. We had a comfortable 4 bed detached house where we we happy to live, had plenty of room and were paying down the mortgage. We had no real reason to move other than wanting to live in a more rural setting.

Lets look at the risk. Worst case scenario is that we see the next rung of the ladder move out of our grasp and we have to stay put in a house that totally meets our needs and that is still gaining in value due to HPI.

Do you see the difference? Actually, I bet you don't and that's why you don't understand risk.

geneer wrote: »

Fair


Good stuff.
You're quite right of course. Low interest rates are quite good for anyone who buys before or after a crash.
Which makes it a strange thing to gloat about.

Unprecedented Low rates are good for everyone who has a mortgage, just as a housing crash is good for people getting onto or moving up the housing ladder. I agree with you that gloating about these events is meaningless in themselves. You can only gloat if you actually take advantage of either of them.

You gloat about falling house prices and yet you have not benefitted from them at all. Effectively you are really just gloating that some people have lost money, not that you have gained money. There is a huge difference between being happy because you have made money and being happy because others have lost money. You won't understand that either.

wotsthat

RenovationMan wrote: »

You gloat about falling house prices and yet you have not benefitted from them at all. Effectively you are really just gloating that some people have lost money, not that you have gained money. There is a huge difference between being happy because you have made money and being happy because others have lost money. You won't understand that either.

What you talking 'bout Willis?

People like Geneer shorted the banks all the way down, invested in silver and sold it at the peak. When they do buy it will be a country mansion at mid 1990's prices. Unfortunately it's all a dream and when they wake up they find they are still paying someone else's mortgage and no closer to owning a home. It helps to understand the bitterness.

The hedging example is a good one. An all or nothing bet where the odds are stacked against you is a high risk strategy - as a short term punt it might come off but longer term it's almost certain to fail.

geneer

RenovationMan wrote: »

I think you have highlighted the inherrent problem with a lot of bears; they simply do not understand risk. I stated that you should not gamble with your home by speculating on the movement of a market. This was in reference to someone like yourself who could have bought a house but decided not to because they thought there would be a crash. It was also aimed at people who sold their houses and rented in the belief that the market would crash and they would buy back in at a higher level. It was also aimed at people who desperately need to move and can afford a larger place but hold off buying in the hope that they can get somethign even bigger in a crash (in the case of my friend, he was in a tiny 2 bed FTB house with a growing family).

Let's look at the risk. The best case scenario is that they could get their house cheaper, the worst case scenario is that the market doesn't change and they are either priced out of the market (FTB), cannot even afford to buy a similar property to the one they sold (STR) or see the next rung of the ladder move out of their grasp and they have to stay put in a house that does not meet their needs or move to a cheaper area in order to afford a large enough place.

Contrast this to what I did. We had a comfortable 4 bed detached house where we we happy to live, had plenty of room and were paying down the mortgage. We had no real reason to move other than wanting to live in a more rural setting.

Lets look at the risk. Worst case scenario is that we see the next rung of the ladder move out of our grasp and we have to stay put in a house that totally meets our needs and that is still gaining in value due to HPI.

Do you see the difference? Actually, I bet you don't and that's why you don't understand risk.

Hypocrite it is then RM.
Doesn't matter how painfully elaborate a comparison you fabricate.

Yeah, you waiting since 2005 for the crash was bang on. You're the man.

Someone else waiting for the crash since 2005, well they're "gambling with the family home".

Yawn.

RenovationMan wrote: »

Unprecedented Low rates are good for everyone who has a mortgage, just as a housing crash is good for people getting onto or moving up the housing ladder. I agree with you that gloating about these events is meaningless in themselves. You can only gloat if you actually take advantage of either of them.

What? Gloating at being a part of the select club of "absolutely anyone who has a mortgage". Whoop de doo. What ever floats your boat RM.

RenovationMan wrote: »

You gloat about falling house prices and yet you have not benefitted from them at all. Effectively you are really just gloating that some people have lost money, not that you have gained money. There is a huge difference between being happy because you have made money and being happy because others have lost money. You won't understand that either.

:rotfl:Another elaborately fabricated argument eh RM.
TBH I don't give much of a monkeys about those who have lost money. I'm surprised you do.
I mean clearly "they gambled with the family home" didn't they?

Eggs. Baskets. Collateral damage.

I, and others, can certainly take intellectual credit and a certain amount of satisfaction at being proven correct, regardless of whether they've yet to buy.

Which is I suppose quite different from "gloating" that you bagged the same interest rate as tens of thousands of others. Or "gloating" that you just happened to be in a position to buy before some other punter. You might want to give that a miss yeah.

wotsthat

geneer wrote: »

I, and others, can certainly take intellectual credit and a certain amount of satisfaction at being proven correct, regardless of whether they've yet to buy.

Can you use intellectual credit to buy a house for your landlord?

RenovationMan

LOL at you geneer. I knew you wouldn't understand the difference in risk. Well, as you said in another thread:

geneer wrote: »

d.ross, if your just going to dismiss evidence as "rubbish" when it doesn't suit you, there really is no point discussing it with you.

geneer, if your (sic) just not going to understand an argument, there really is no point discussing it with you. :rotfl:

RenovationMan

wotsthat wrote: »

Can you use intellectual credit to buy a house for your landlord?

He's got it earning 2% interest at his intellectual bank. No wonder he wants BoE rates to go up! :rotfl:

wotsthat

geneer wrote: »

I, and others, can certainly take intellectual credit and a certain amount of satisfaction at being proven correct, regardless of whether they've yet to buy.

Come on Geneer. Why don't you put this to bed and show how you've been proven correct?

When could you have first purchased but chose not to?

How much rent have you paid to your long suffering landlord?

What's happened to your target house price in that time?

Or are you going to get coy again?

RenovationMan

Geneer has also predicted the winning numbers for tonight's +£100M Euro lottery. He's not going to buy a ticket because he just wants the intellectual credit and satisfaction at being proved correct.

He will be publishing his lottery prediction tomorrow and will be proved right. All numbers will be correct!