opinions - not a perfect house - not a perfect area - but cheap.

roswell · 18 February 2007 at 9:00AM

Morning All,

I have come across a strange but interesting thought, A short history and your opinions greatly recieved.

About 4 years ago I met my fiance, at the time I had just purchased my first house. As time and life progressed and i was interested in property I noticed that there were street houses in a badish area that were at the time an amazingly expensive £20 000, by 2004 these were changing hands very quickly from owner occupier to BTL as the first batch of tenants were a night mare but property prices raising these sored (relatively) in price up to £75 000 by the end of 2004.

Now recently a number of these properties have come on the market I believe many are owned by a property company in london who seem to be offloading there stock (I know one of the tenants) and they are selling at around £40 000 - £50 000. And are now changing hands back to owner occupiers result = area is improving.

Now the situation, My partner and I currently live in a rented flat (council) the mortgage on £50 000 would be £20 a month more than our rent ..... So i guess the question really is. Would you purchase a house in a area you didnt like if it ment you could move out of a flat (that is now to small) in a area you like ?

More importantly as these properties are "Bottom of the barrel" they were the last to increase in price .. but seem to be the first showing a sign of prices falling. These would always have a rental demand i believe so the next question.

Would you buy a house In an area you didnt like knowing that it wouldnt be forever and that you believe you could let out in the future?

Pro`s
More space,
Mortgage costs only marginaly higher than current rent costs
outgoing bills would remain about the same.
2nd property.
Mortgage commitment across current house and one of these houses would be less than 2.5 X my income.

Con `s
Chance prices could fall further (but across the 2 properties this wouldnt be a problem assets would = more than debt)
Not the property I would idealy want to raise a family in but also dont currently have a family.
May be hard to sell but easy to rent out.

Your thoughts ?

lynzpower · 18 February 2007 at 9:05AM

Where abouts in the UK are these properties?

You say they are the most likely to fall in value, but Id suggest that properties right at the top are more likely to fall in value as there are fewer buyers able to afford them

where I work, the bottom end of the market is ridiculously busy, wheras theres less demand for those at the top end.

roswell · 18 February 2007 at 9:08AM

These are street house`s in hartlepool. 2 of them turned up on right move last week have since disapeared.

lynzpower · 18 February 2007 at 9:10AM

If you could rent the place for 20 extra a month would you take it?

roswell · 18 February 2007 at 9:17AM

yeah for £20 a month extra I would but i know that the company that owns them doesnt do repairs, our flat on the other hand has had a few burst pipes and these are fixed very quickly by the council.

I dont mind doing or paying for repairs on the property I own but wouldnt pay or do repairs for a land lord.

roswell · 18 February 2007 at 9:21AM

Link to type of property

http://www.rightmove.co.uk/viewdetails-12550304.rsp?pa_n=1&tr_t=buy

lynzpower · 18 February 2007 at 9:22AM

roswell wrote:

yeah for £20 a month extra I would but i know that the company that owns them doesnt do repairs, our flat on the other hand has had a few burst pipes and these are fixed very quickly by the council.

I dont mind doing or paying for repairs on the property I own but wouldnt pay or do repairs for a land lord.

are they being sold off as freehold??

roswell · 18 February 2007 at 9:31AM

They were freehold originaly so I would assume they still are but cant confirm. I know tenants have been given notice that the properties are going to be sold. But the ones in question havent been advertised anywhere yet.

roswell · 18 February 2007 at 9:31AM

They were freehold originaly so I would assume they still are but cant confirm. I know tenants have been given notice that the properties are going to be sold. But the ones in question havent been advertised anywhere yet.

lynzpower · 18 February 2007 at 9:38AM

personally, Id be very tempted.

TO get your own property and the extra space- for an extra 20 pm - sounds like a cracking prospect.

Have you got money for sols etc?

RHemmings · 18 February 2007 at 9:41AM

Do you have children? You describe this as an area you don't like? If you had children, or planned to have them, then you should consider that your children may be influenced by peer group pressure. And in some areas that peer group may be street gangs and the like.