How many people here have sold to rent (anticipating a crash)?

Alan_M_2

Lets consider this from another point of view for the OP.

How much does it matter to you that you have your house now? Lets say, it wouldn't bother you if it took two or three years to find the right place, but the right place is what you intend to live in for a long time (10 + years).

I only ask this for one reason....If you think there will be a correction in the market, this doesn't happen over night, a crash is actually the wrong word to use for these situations as it suggests there;s a single impact and everything is cheaper.

The anatomy of a crash is basically the negative of the anatomy of a boom, certain areas will start falling....generally London and the Home counties and this gradually ripples outward around the country, some areas are sheltered and aren't effected, some are devastated but this could take 5 years form the date of the first headline until it hits bottom.

So, lets say The Daily Mail is right this weekend and a crash has started and the headlines start......it might be 2012 before it all levels out and we're back at what would probably be slightly undervalued.

Would waiting 5 years bother you?

This doesn't bother me in the slightest, but that's because I have all my money tied up in a business instead of a home, that's working fine for me, maybe in 5 or 10 years time I will be in a position to buy the house I want without a mortgage at all, but it's a gamble, STR is a gamble, BTL is a gamble, there's just various levels of risk/reward.

What you need to find is the level of risk/reward that you're comfortable with (that allows you to sleep soundly at night). And weigh up the pros and cons of living in an owned property or rented property.

Ms_Piggy_2

Alan_M wrote:

How much does it matter to you that you have your house now? Lets say, it wouldn't bother you if it took two or three years to find the right place, but the right place is what you intend to live in for a long time (10 + years).

...

What you need to find is the level of risk/reward that you're comfortable with (that allows you to sleep soundly at night). And weigh up the pros and cons of living in an owned property or rented property.

In answer to point one, I'd wait a few years and would rather wait and get the right place (and stay put 10+ years) than rush to buy the wrong place.

I'm rather risk averse - which is why all my money is in gilts etc and why I'll never be rich!
We're in the Nort East too, so I imagine any correction will be less severe than in the SE/home counties.

Alan_M_2

So with a cautious nature STR is probably not for you. You'll be living a worry that you'd done the wrong thing.

However on the upside, you have a sizeable deposit and you're looking for a long term family home which is somewhere to be happy, if it turns out to be an investment long term that's a bonus, if there's a drop in value short term, it will be annoying but fundamentally it won't effect you as you're in for the long haul.

So you could live in one of your properties whilst you looked, you could sell both, find somewhere nice to rent and look at leisure (this will put you in a better bargaining position with effectively no chain).

If after a year or two you've still found nowhere, the market may have changed, you can re think you're status at that time.

None of it's wrong, none of it is right, but what's important is you're comfortable with what you're doing and can afford to ride out any problems that may occur in the short term future.

pioneer

I'm Considering STBASPAHTPIAAing "Selling To Buy A Similar Property At Half The Price In Another Area"

Keeps you in the market, don't have to pay rent, frees up loads of equity and I can exit the RR (Rat Race) and give up paying Gordon loads of Tax.

How that for lateral thinking ? Lifes too short to pay mortgage interest and buy Tonys Bombs !

JBeau

Ms_Piggy wrote:

Which is exactly what worries me :rotfl:

We *are* after a family house to be a home rather than looking at making a fast buck. We'd stretch ourselves to get what we want (rather than have to do it in two moves) but will have a deposit of £50k which will help.

Thanks for all your comments.

(And yes, the House price Crash site is just a tad scarey!)

If you buy now, you don't stand a chance of making a fast buck anyway. You do stand the chance of being trapped for many many years in a property that for any reason is no longer suitable. As for HPC site....often the plain facts (hard to take it sometimes)are scarey ....look between the banter for the plain facts. I strd ( kids an all) I used my equity to buy a home in France, the remaining equity makes interest every month . I truly believe it's worked for us, because I feel I've used my equity well, and am now ready to jump back in to the market when price levels are more comfortable for us.
Buying now IMHO could possibly eat up your 50K very quickly. Best of luck.

roswell

Im 50 / 50 I live in a rented flat but own a house what does that make me ?

MJMum

We STR but, again, because we relocated to a different part of the country, not in anticipation of a crash. We are trying to buy again, but we have downsized slightly (due to marginally cheaper area and lower spec house) and are very happy with our new affordable-on-one-income mortgage / lifestyle

pioneer

roswell wrote:

Im 50 / 50 I live in a rented flat but own a house what does that make me ?

Over exposed to the property market ?

Bank the house and TTLF.Trip the light fantatic. Try equating how many years you would have to work to pay the house off over a normal term. If you release £100K, that 200K on a mortgage and £400K of gross income!!!

Treat it like any other asset, leave something for the other man while you still have a rising market, if its up and you still believe you want to stay in;just like shares/funds sell half your holding. Profit Taking only on a larger scale. When this baby turns there aint gonna be any prisoners and just as they wish they'd caught the up, many will be left holding the baby for decades to come and wishing they had sold before the down, down, down.

zipwen1

there is a thread on here somewhere that explains why the last house price crash happened. after reading everyones explanation i was left quite confident that a crash that would leave your property virtually worthless wont be happening anytime soon.

uk_steve

pioneer wrote:

I'm Considering STBASPAHTPIAAing "Selling To Buy A Similar Property At Half The Price In Another Area"

Keeps you in the market, don't have to pay rent, frees up loads of equity and I can exit the RR (Rat Race) and give up paying Gordon loads of Tax.

How that for lateral thinking ? Lifes too short to pay mortgage interest and buy Tonys Bombs !

i like your style!


but i have to move miles to get the same ratio so thats me snookerd