House price predictions

ds1980

abaxas wrote:

I'm sorry for saying this.. but...

Your talking out of your ar@e under the assumption that 'house prices always go up'.

Also you forget that maintainence you'll have to do on the propert (usually 2% of house cost PA), interest payments, moving costs. Etc etc the list goes on.

Please dont try to make points you dont understand. Housing is a complex topic, over simplifications will only make you look like a fool.

(sorry for being a little rude but people have to understand there is a bigger picture not the little microcosm they live in)

I didnt say they dont go down only that people who are waiting wont be any better off.

The fortunate thing for me is its people like you who only make me
1. earn more and
2 want to earn more

Just for info - Mortgage free at 26 - million pound property portfolio in less than 3 years with minimum of £300000 equity. 3 successful businesses and a regular 9-5pm job. Don't think id have got to this stage with being stupid. If you would like any advice id be happy to give it to you but please ebar in mind i am extremely busy and you probably couldn't afford me.

be good

rebeccaj

ds1980 wrote:

Mortgage free at 26 - million pound property portfolio in less than 3 years with minimum of £300000 equity.

don't understand this. How can you be "mortgage free" as you say if you have just £300,000 equity in a million pound portfolio

abaxas

ds1980 wrote:

I didnt say they dont go down only that people who are waiting wont be any better off.

The fortunate thing for me is its people like you who only make me
1. earn more and
2 want to earn more

Just for info - Mortgage free at 26 - million pound property portfolio in less than 3 years with minimum of £300000 equity. 3 successful businesses and a regular 9-5pm job. Don't think id have got to this stage with being stupid. If you would like any advice id be happy to give it to you but please ebar in mind i am extremely busy and you probably couldn't afford me.

be good

Good to you! It's good to see other people kicking some !!!! and making money! However dont invest your ego in this, it's now worth the potential egg on face if you're wrong. (this is good advice, you cant buy credibility, it is earned)

Have you ever thought that a crash would be the best thing for you? It would give you the opportunity to increase you business and make more money. Anyone can make a killing in a rising market, those with savvy make it during stagnation or 'crash'.

I've always made this point, we NEED a crash. It will sort out the dead wood and lets people make money again. The only other way out is wage rises, IR rises, job losses and recession.

Bring on the pain NOW, lets get it done and over with (agahgah I'm sounding so american now!)

boom-bust-boom-bust-boom-bust.

devils_advocate

Just for info - Mortgage free at 26 - million pound property portfolio in less than 3 years with minimum of £300000 equity. 3 successful businesses and a regular 9-5pm job. Don't think id have got to this stage with being stupid. If you would like any advice id be happy to give it to you but please ebar in mind i am extremely busy and you probably couldn't afford me.

Interesting to note that you're 26 - so its doubtful you remember the last crash. in your other example, you mention that you couldn't see prices dropping £50k, which was a third of the inflated value. Ask anyone who was a property owner in the last crash if prices dropped by a third, and I'm sure the answer will be 'yes'!

Similarly, you've got a large portfolio no doubt through gearing. Don't forget that it works the other way round, that if your million pound portfolio falls 15%, your equity falls 50%! And have you factored in that your borrowings are in a low interest rate enviroment, with a very loose money supply. Rates have risen, and IMHO will rise more, but the other effect of inflationary rises will be for the BoE to tighten the money supply. The practical effect of this is banks having less money to lend, so even if a lot of people can afford the repayments, the banks lending criteria will tighten to exclude all but the triple A risks.

Not saying that you are going to lose money, but I wonder if you have experience or understanding of all the risks?

FleetFanatic

ds1980 wrote:

ok for all you people that are hoping the house market will crash.

imagining a £150000 house 2 years ago has risen ?????? 15% i would say a lot more than that but im being conservative. price now is £172250. the house market then falls 20%-30% price now £138000 - £120750 (please bare in mind that this is highly highly unlikely. A house is not going to lose £50000 im sorry but its not and remember you only lose out if you sell!

rent costs for 2 years (conservative) £500 pm ???? = £12000. This could have gone into your own house!!!!

Money paid off mortgage in 2 years (capital and repayment) = £5000 or so.

No hassles with getting someone round to look at the washer, can i paint this can i paint that.

Do the sums and really you'll actually gain eff all! Don't forget the capital you should have gained in those 2 years which could have been a nice sum to move to a bigger house or use to have nicce holidays or treat yourself to a new car without having to borrow off a loan company as such. (remortgages are generally cheaper than a loan). I could go on and on and on but you should do the maths yourself and if anyone would have been better off waiting than good luck to you but you'll be one in a million that won't.

I thanks you!

It's not about any of this.

It's about price to earnings.

ds1980

rebeccaj wrote:

don't understand this. How can you be "mortgage free" as you say if you have just £300,000 equity in a million pound portfolio

Thanks for this. I mean i don't pay my mortgage as such. i bought my own house outright. The others are rented out and others pay my mortgages on those, i have enough money and rental yields that even if a crash of 40% i wouldn't be affected. I do understand the risks of property but i also know that im lucky to be alive and could die tomorrow so i try and make the most of things

ds1980

devils_advocate wrote:

Interesting to note that you're 26 - so its doubtful you remember the last crash. in your other example, you mention that you couldn't see prices dropping £50k, which was a third of the inflated value. Ask anyone who was a property owner in the last crash if prices dropped by a third, and I'm sure the answer will be 'yes'!

Similarly, you've got a large portfolio no doubt through gearing. Don't forget that it works the other way round, that if your million pound portfolio falls 15%, your equity falls 50%! And have you factored in that your borrowings are in a low interest rate enviroment, with a very loose money supply. Rates have risen, and IMHO will rise more, but the other effect of inflationary rises will be for the BoE to tighten the money supply. The practical effect of this is banks having less money to lend, so even if a lot of people can afford the repayments, the banks lending criteria will tighten to exclude all but the triple A risks.

Not saying that you are going to lose money, but I wonder if you have experience or understanding of all the risks?

I listen to lots of people and do a lot of research I now have a great team behind me so i take an interest but they do most of my work i do the maths

Alan_M_2

ds1980 wrote:

Thanks for this. I mean i don't pay my mortgage as such. i bought my own house outright. The others are rented out and others pay my mortgages on those, i have enough money and rental yields that even if a crash of 40% i wouldn't be affected. I do understand the risks of property but i also know that im lucky to be alive and could die tomorrow so i try and make the most of things

Just a point of note, based on your figures of £1million and equity of £300,000 a drop in value of 40% would put you £100,000 in negative equity.

Good luck to you, but you are heavily overgeared in one investment vehicle.

ds1980

Saw this in the FT

If interest rates stay at 5.25 per cent or move higher, buy-to-let investors and house builders will come under increasing pressure.” Simon Hope, a partner at Savills, warned that further rises towards 6 per cent could be “a trip switch for a big problem”.

correct me if im wrong but If house builders find it increasingly difficult will this not widen the shortage terefore sustaining prices? These things just go round in circles its knowing when to get off!!!

FleetFanatic

I think they mean find it difficult to sell their newly-built property.....

.....thus a surplus rather than a shortage.