Offer advice on 300K..can I get under 250?

noddynoo

Loopgames wrote: »

Why not wait until markets recover? Sad to read your predicament.

The markets won't recover!
This is a permanent change for the better imo.
We all need to rethink money and debt full stop.

HAMISH_MCTAVISH

noddynoo wrote: »

The markets won't recover!.

:rotfl:

Ahhhh, of course. "It's a new paradigm."

ukcarper

WibbleSnarf wrote: »

Houses are selling fairly well in Surrey? Are you sure about that?

Straight from the "Surrey Houses" website at this link: "Land Registry figures for June show sales completions down 20% on the same month for the previous year and down about 50% for the number of completions usually achieved in June prior to the 2008/09 property crash."

Of course, there's a case to be made that 20% down on last year (and 50% down on 304 years ago) actually *is* 'selling fairly well' but the context is key. There's a world of difference between 'good' and 'least worst' in a market that is tumbling.

The June Land Reg figure are for completion in April are indeed down to 1063 from 1305in 2011, but for March they were up to 1520 from 1214 in 2011.

For April 2009 the figure was 921 and for 2008 they were 1407

They are 50% lower that the max in the boom but i would have thought that would be selling fairly well especially when you consider there are less houses on the market.

WibbleSnarf

HAMISH_MCTAVISH wrote: »

Oh dear....

According to Nationwide, house prices are down 10.6% from peak. According to Land Registry it's less than 12%. ONS and Acadametrics have it more like 5% below peak.

You of all people know very well the significance of, and difference between, nominal prices and inflation-adjusted prices. Of course, nobody is in a position to stop you from using the former to present a skewed view of the *real* world but allow me to remind you in case you've forgotten since you were banned from HPC for your incessant trolling. For one, I'd happily welcome you back - given the way the market has gone since you were given the boot, I'd find it hilarious watching you clutching at straws that no longer exist! Anyway, as promised, here's the difference: The 'inflation-adjusted' price of an asset allows one to make a determination of the value of that asset in terms of the relative spending power of the money that it is effectively 'worth'. The phenomenon is known by economists at the 'money illusion' and there's a great explanation of it here.

Sticking with Nationwide's index for now (I concede that the index is flawed in several ways but only in ways that mask the full extent of the price drops so they working in favour of those in HPC denial so I do you no disservice by sticking with them for now), average prices for Q1 2012 are £162,722. When adjusted for inflation, so as not fo fall foul of the 'money illusion', average prices in Q3 2007 were £212,887.

Now, as I said, you can dress that up as a 10.6% fall from peak if you like but forgive me if I picture you as Comical Ali wearing a kilt when you do! I'm really not sure if I find it funny, pitiful, or a bit of both!

HAMISH_MCTAVISH wrote: »

You'd have to cherry pick Halifax data to show a 20% fall, and even then you'd be ignoring the fact that Halifax shows a similar price today as Land Registry and Nationwide. And the difference is not the falls since 2007, but rather that Halifax showed a higher peak than the other two.

I have no interest in cherry picking data. You see, I have this weird thing that I do. I study the data and, based on what the data tells me, I draw conclusions. You on the other hand, along with a few others of your kin operate in the reverse way, sniffing out isolated fragments of data that appear to support a position and which, almost universally, crumbles when subject to even the most basic of scrutiny.

I note, for example, that the Stan to your Ollie (ukcarper) cherry-picked a bit of data about his local market from the Land Registry and posted it earlier before either deciding, or being persuaded, that it wouldn't stand up to even 2 minutes of cross-checking. He then chose to edit it out of his post. I have no reason, nor inclination, to have to do similar.

Your assertion that the Halifax data somehow 'doesn't count' - again because it doesn't suit your entrenched position - is nothing short of preposterous. "Awwww, b-b-b-b-but it doesn't count because it shows prices falling too much!" Frankly bizarre!

If we really want to keep this discussion sensible then we have to work with the most complete (albeit still imperfect as it excludes 'distressed' sales) set of data that is available to us and that is the Land Registry data.

HAMISH_MCTAVISH wrote: »

Also worth noting that rents have been soaring to new record highs, while homeowners have been enjoying record low rates, so even someone that bought at peak is now more or less even with renters since then.

Mmmmmkay!!! Yeah, I'll bet all those renters who chose not to buy in 2007 and are now reading about the hundreds of thousands of people across the country who are trapped in negative equity on SVRs which are gradually inching upwards are feeling pretty even! Let us not pretend that these new headline grabbing deals that are in theory now available, such as the 2.99% 5-year fix, really are open to the masses. They are out of reach of almost every FTB owing to the strict LTV criteria associated with them. Allow me to illustrate this another way - I'll lend anyone who wishes to apply up to £100,000 at BoE base rate, fixed for 5 years. All they need do to qualify is speak fluent Welsh, have one leg 3-inches longer than the other, have been called David Beckham since birth (none of this deed poll nonsense, please) and have one blue eye and one brown eye.

HAMISH_MCTAVISH wrote: »

[That the house price crash has not yet finished is] A matter of opinion.

Land Registry shows prices have risen and are now year on year positive, as does ONS and Acadametrics.

Haliwide show a slight dip year on year.

All of them show prices remain substantially higher than they were in early 2009 when the market bottomed out.

So at best you could claim prices are stagnant, with a mixed picture currently among the key indices.

The reality would be to say prices have risen a fair bit since the market bottom in most places, and those who advocated waiting for cheaper prices since then have been wrong.

It's not a matter of opinion at all - it's a prediction. A prediction based on 2 simple premises. 1) The UK housing market is stuffed. 2) The wider UK on which the UK housing market depends is stuffed. Your prediction may be different but your track record's not exactly great and the market fundamentals are much, much worse than they were when you could be regularly be seen trolling the HPC fora.

The rest of your post continues to cover its metaphorical ears and go 'la la la - I'm not listening', as regards that cheeky little scoundrel called inflation, to which you appear to prefer to turn a blind eye.

The 'best' I can claim is much better than you like to pretend. Those who advocated waiting since early 2009 are not wrong, and are only just beginning to see the benefits of not jumping into the chasm. Do feel free to keep trying to mislead people into making ruinous decisions but I prefer to sleep at night.

HAMISH_MCTAVISH wrote: »

Wrong again.

According to Halifax the long term average is 4.0. And the current average is 4.3.

Interesting. But neither one of us is more wrong than the other. I quoted Nationwide figures and you quoted Halifax figures. Both are inaccurate as they don't cover the whole market but what remains true in both cases is that both show prices being higher than the historic average and the trend in both is downwards.

HAMISH_MCTAVISH wrote: »

But also according to Halifax the percentage of after tax income for new buyers used to pay a mortgage is just 26%, which is far below the long term average of 37%.

This statistic is useful insofar as it suggests that the likelihood of repossessions when compared to the crash of the 90s is probably lower but it's not meaningful as a barometer for FTBs to prop up the bottom end of the market. The cheap credit tap has been turned off and it's not going to be turned back on any time soon. The game is up. Large numbers of lender valuations are now resulting in prospective buyers having to pull out of purchases - something unheard of while the bubble was inflating. The other thing this statistic indicates is that the few FTBs there are out there are getting huge deposits gifted (or loaned) to them by the bank of mum and dad. This results in smaller proportional repayments as a big lump of the capital has already been cleared. Of course, statistical quirks such as this are to be expected when volumes are so low but don't make the mistake of thinking that the 26% figure is any kind of indication of long-term sustainability!

HAMISH_MCTAVISH wrote: »

Buying a house has rarely been cheaper than it is today, when all costs such as mortgage interest are taken into account.:cool:

My turn to do the 'Oh dear...' now. If buying a house is cheap now, I'm looking forward to 2014 when people will be practically giving them away!

Strapped

Die thread, die...

cwcw

WibbleSnarf wrote: »

Those people who have been saying it for the last 5 years have been proven correct to the tune of 20%. And it hasn't finished yet.

According to the data used to produce the graph on this page, the ratio currently sits at 4.3 - about 23% above the love term average of 3.5. And what's to say, in a market where house prices are falling, that the ratio will hit the historical average of 3.5 and level off? By its very nature, it's an average because prices are historically sometimes both above and below it, and the historic precedent is for the ratio to drop below 3.5 before eventually swinging back in the other direction again.

I don't think the average price to average earnings ratio is relevant any more. Historically, there was a male head of household who would earn most, if not all of the family income, so measuring against the average salary made sense. More recently, most women of younger generations work full time, or at least part time, even through the early years of children. Measuring average price to average earnings ignores a significant element of income. Average prices to average household income would make much more sense. In my mind, this predominantly dual aspect to household incomes has been one of the key drivers of HPI.

PS. I don't really disagree with your over all argument, since even taking into account the dual income aspect of modern households, prices are still high and are being artificially supported by low interest rates. However I don't see that a true crash will be allowed to happen, more a gradual adjustment which may be a crash in real terms but nothing massive in nominal terms. That's why interest rates will stay low for quite a while yet, and only really high inflation would compromise that (BoE have previously ignored inflation as high as c5%, so would need to get somewhat higher than that).

WibbleSnarf

cwcw wrote: »

I don't think the average price to average earnings ratio is relevant any more. Historically, there was a male head of household who would earn most, if not all of the family income, so measuring against the average salary made sense. More recently, most women of younger generations work full time, or at least part time, even through the early years of children. Measuring average price to average earnings ignores a significant element of income. Average prices to average household income would make much more sense. In my mind, this predominantly dual aspect to household incomes has been one of the key drivers of HPI.

I wouldn't dispute that it's been a factor, although the availability of cheap credit and sentiment are overwhelmingly the 2 significant factors and even without dual incomes it would still have happened.

I agree that average house price to average household income would make more sense but average house price to average household income minus the cost of childcare would make more sense still. Anecdotally, several of the couples I know where both parents work full time say their lower income barely offsets the cost of childcare after tax.

cwcw

WibbleSnarf wrote: »

I wouldn't dispute that it's been a factor, although the availability of cheap credit and sentiment are overwhelmingly the 2 significant factors and even without dual incomes it would still have happened.

I agree that average house price to average household income would make more sense but average house price to average household income minus the cost of childcare would make more sense still. Anecdotally, several of the couples I know where both parents work full time say their lower income barely offsets the cost of childcare after tax.

True, but normally the mortgage is applied for and house bought before the children are born. There would likely be a few years of sailing financially close to the wind that the lender doesn't know about, between birth and school age, and the free childcare that then brings. Also, some people have free baby sitting from grandparents.