House prices to fall 5% in 2013

wotsthat

Graham_Devon wrote: »

What's unique about this prediction is it includes a real life scenario. FTB's will need to save £450 every single month for 5 years in order to gain a 20% deposit.

I don't care what anyone says, that's a lot of money to be saving while living.

Capital Economics tend to be overly bearish but say their 5% prediction turns out to be correct our potential FTB's would still need to save £427/ month for 5 years so this offers little relief. It doesn't take many calculations to realise that even the most unlikely of crashes will still require saving discipline. Plus if that crash does happen deposit requirements will worsen and lending will reduce.

If parents etc. can't help out it comes down to a couple of simple questions - do I want to buy or rent? What can I do to get the deposit together?

It's not that new or unique that a deposit calculation has been carried out. Some people did this calculation a few years ago and asked themselves whether they wanted to buy or rent - FTB numbers were at a 5 year high in 2012. In 2011 4 out of 5 FTB purchases went ahead with help from parents.

Not easy but some have been getting on with it for years now.

wotsthat

michaels wrote: »

There do seem to be quite a few mortgages available with a 10 or 15% deposit.

The amount of saving suggeste dis not hard if that is a priority even for a single person in a traditional graduate job who is likely to start on 20+ and quickly get more, even easier if living as part of a couple with 2 incomes (or house sharing) so quite possible to buy by late 20s and tbh most people I know would not have wanted to buy before that as jobs, relationships etc might change.

The average FTB LTV was 81% in 2012 (from memory) which is a slight improvement. I think the higher LTV mortgages are headline grabbers and aren't really impacting on the average.

shortchanged_2

wotsthat wrote: »

Capital Economics tend to be overly bearish but say their 5% prediction turns out to be correct our potential FTB's would still need to save £427/ month for 5 years so this offers little relief.

That sounds like good MSE advice wotsthat wouldn't you say?

Or are you advocating that it's actually better that FTB's should pay more for housing?

wotsthat

shortchanged wrote: »

That sounds like good MSE advice wotsthat wouldn't you say?

Or are you advocating that it's actually better that FTB's should pay more for housing?

I've not offered any advice.

My advice though, if a potential FTB was interested, would be to save like mad and hope prices fall in the meantime, hope deposit requirements ease and hope cost of finance falls. Only one of these is under the control of the FTB so that's where I'd concentrate my efforts.

Clearly if someone is buying a house they want to buy it as cheaply as possible - why wouldn't they?

Niv

Generali wrote: »

There are the big bills that come infrequently e.g. roof, boiler, new carpets etc.

I agree there are. In fact the essential maintenance I have undertaken was for a roof repair (£200 - only flashing so lucky maybe).

If you want longer term, I can go from the total time I have owned a house (seven years is current house). So 13 years and only spent £3k. First house had a horrible kitchen which cost me £1k to replace. So 13 years of home ownership 'should' have spent ~£21k on maintentance and actually spent ~£3k (still only 1k absolute 'essential maintainence'). I am gonna have to have alot of big things going wrong to 'put me on track'. The massive figures quoted just dont add up.

Maybe I have never needed to replace my boiler because it is a reliable back boiler and not a combi (which always seem to be going wrong - based on my time looking at the diy threads).

HAMISH_MCTAVISH

shortchanged wrote: »

Or are you advocating that it's actually better that FTB's should pay more for housing?

You seem to be advocating that FTB-s should pay more for housing all the time.

You want them to have to pay high deposits, which means they are stuck in rented for many years more than they should be, adding tens of thousands to their lifetime housing costs.

Over a million FTB-s have been prevented from buying in the last few years thanks to the mortgage famine. So rents have soared to record highs as a result.

Not very MSE, is it?

HAMISH_MCTAVISH

wotsthat wrote: »

My advice though, if a potential FTB was interested, would be to save like mad and hope prices fall in the meantime,

FTB prices rose by 3% last year.

But 12% more FTB-s were able to buy.

nollag2006

Is this the same Capital Economics that predicted rapid house price drops from 2000 up to mid 2007, and that then admitted they were wrong all along in late 2007 and that prices would continue to soar?

These jokers have a worse price prediction accuracy rate that either Devon or Brit !!

Classic

HAMISH_MCTAVISH

nollag2006 wrote: »

These jokers have a worse price prediction accuracy rate that either Devon or Brit !!

Well thankfully, they're still predicting price falls, so I expect prices to rise nicely.

droiderm

HAMISH_MCTAVISH wrote: »

You seem to be advocating that FTB-s should pay more for housing all the time.

HAMISH_MCTAVISH wrote: »

so I expect prices to rise nicely.

Increased prices implies FTB's will be paying more for housing.