Come on bulls admit it.......

Really2

Sold in 2008 5% under peak valuation. Purchased in 2008 at 27% bellow peak (peak price for said property being april 2008, I purchased August 08).
Been on a +.49% BOE tracker for 3 years now.

TBF I am OK with what I did in the crash.

andybenw

macaque wrote: »

..... If you had known in 2006 what was coming, surely you would have quit the property market? Property today is a tricky business and a lot people are nursing big losses (quite apart from the hassle and risk). The problem is that the closer you are to the peak, the harder it is to make a profit. This is no easy way down either. Most would be buyers are hanging on to their cash for now.

If I had sold my property not only would I have had fees. I would also have lost my steady income of lodger money. And then on top I would have had to have paid extortionate rent at a far higher rate than I could have hoped to make on my savings.

Since 2007
Property then 155k, now 140k (Judging using sold prices)
Therefore 15k capital loss.

Remain in house.(No mortgage) Lodger income 590x12x4= 28320
28320-15000 = 13320
Loss of savings of 155k 3% per year = 18600
13320 - 18600 = -5280

Sell to rent
Savings of 155k make 3% per year = 18600
Rent for similar house 850 per month. 850x12x4 = 40800
18600 - 40800 -15000 = -37200

All in all i am approximately 32000 pounds better off over a period of 4 years due to staying put in my property.

MrRee_2

I can only conclude that they taught Maths at Bull College .... but, instead of Maths, they spent their time telling fairy tales in Bear College?

Jimmy_31

MrRee wrote: »

I can only conclude that they taught Maths at Bull College .... but, instead of Maths, they spent their time telling fairy tales in Bear College?

That went down well didnt it:)

the_flying_pig

andybenw wrote: »

If I had sold my property not only would I have had fees. I would also have lost my steady income of lodger money. And then on top I would have had to have paid extortionate rent at a far higher rate than I could have hoped to make on my savings.

Since 2007
Property then 155k, now 140k (Judging using sold prices)
Therefore 15k capital loss.

Remain in house.(No mortgage) Lodger income 590x12x4= 28320
28320-15000 = 13320
Loss of savings of 155k 3% per year = 18600
13320 - 18600 = -5280

Sell to rent
Savings of 155k make 3% per year = 18600
Rent for similar house 850 per month. 850x12x4 = 40800
18600 - 40800 -15000 = -37200

All in all i am approximately 32000 pounds better off over a period of 4 years due to staying put in my property.

awful, awful example all-round IMO. typical bull stuff really, poor logic, poor maths.

(1) on the face of things, of the £32,000 by which you claim to be "better off over a period of 4 years due to staying put in my property" almost all [£28k] is due to having a lodger, so you might as well say 'better off as a result of house-sharing as opposed to living alone'.

(2) you actually bias your estimate of the amount by which you're "better off" downward by counting the lost interest of £18k in both the 'stay' and 'go' side of your equation [think about it for a moment].

(3) as an aside it's quite expensive to rent rather than buy in your street [nearly 7% gross yield - unimaginably high by the standards of, for example, where i live in SW London] although funnily enough all the 'bulls' on here live in streets like that [just as they all without exception live in streets where the halifax c 20% price fall from peak is nowhere to be seen].

(4) you don't include the tax you'd have paid on savings, but then nor do you include tax paid on income from the lodger [although that could have been tax free i suppose].

(5) lastly you budget for the £15k capital loss even in the scenario where you sell up pre-crash, which just seems bizarre.

Mistakes (2) and (5) almost cancel each other out [£18k being quite close to £15k]... basically points (1), (3), and (4) aside gets you to being £35k better off, using your logic [i.e. ignoring tax, believing that rent would have been as expensive as you say, & accepting that the lodger doesn't matter] you are actually £35k better off.

ukcarper

Lets have a simple example house sold in my road £285k in 2007 sold for £277k in 2009 rent over that period would have been £24k. Prices are higher in my area than they were in 2009.

Cleaver

It's always fascinating on here that arguments about whether it was 'right' or 'wrong' to buy a house at a certain point in time centres around finance and finance only. Whilst this is one factor people do and need to consider, you lot are aware that for the vast majority of people out there they don't care about timing the market and judging when is best out of a ten year period to buy a house? Most people do a mixture of getting married or getting a long term partner, getting a career, having kids and all that jazz. And at some point they want to buy a house, because it generally fits their lifestyle.

I rented properties in 1999, 2001 and 2003. My wife and I bought properties in 2004, 2007 and 2009. I have no idea whether we are better off financially over any of those periods and, frankly, I don't care. During 1999 to 2003 renting suited my lifestyle and from 2004 to present buying suits our lifestyle.

sarkin1

Cleaver wrote: »

It's always fascinating on here that arguments about whether it was 'right' or 'wrong' to buy a house at a certain point in time centres around finance and finance only. Whilst this is one factor people do and need to consider, you lot are aware that for the vast majority of people out there they don't care about timing the market and judging when is best out of a ten year period to buy a house? Most people do a mixture of getting married or getting a long term partner, getting a career, having kids and all that jazz. And at some point they want to buy a house, because it generally fits their lifestyle.

I rented properties in 1999, 2001 and 2003. My wife and I bought properties in 2004, 2007 and 2009. I have no idea whether we are better off financially over any of those periods and, frankly, I don't care. During 1999 to 2003 renting suited my lifestyle and from 2004 to present buying suits our lifestyle.

Your a lucky sun of a !!!!! you could have been born 5 years later.

Bring on the free money homeowners need help

Cleaver

sarkin1 wrote: »

Your a lucky sun of a !!!!! you could have been born 5 years later.

I don't really know what this means?

The house we bought in 2004 we sold in 2008 for £15,000 less than we paid for it. The flat we bought in 2007 we sold in 2009 for £2,000 less than we paid for it. The house we bought in 2009 and are living in now is probably worth the same or less than we paid for it. So I've never made money from property in my life, well, not in the traditional 'sell for more than you bought' way. Don't regret any of the purchases though and never sat down and worked out whether renting would have been better in a financial sense.

reweird

Selling prices are now lower than they ever were so I wonder what the OP's agenda rally is.