house price madness

[Deleted User]

AndyGuil wrote: »

It's not the county of Greater London but it does have a tube line into London. Like many parts of Surrey, Berkshire, Middlesex etc. it will be absorbed.

The majority of Hertfordshire is outside of the M25. Yes, there is some connections into London (The tube at Watford, the Thameslink line that runs up to St Albans).

However, it's not effected by the same 'foreign investor' forces that boost prices up in the City and 'London'.

I don't quite know where the OP is looking to buy, but you can certainly find homes at South East, rather than London prices, even 'near' commute belts for London.

The people propping up the expensive houses around South Hertfordshire are more likely to be footballers and soap stars than Arab princes and Russian Oligarchs.

I wouldn't consider places like Welyn and Hitchin as 'London' at all. It's quite a big county and only a small part of it is commutable to London.

I'd be interested to see where the OP is looking, as I found a very nice 4 bed detached house in Shenley for £500k, which is only a short drive to Borehamwood or Radlett stations.

AndyGuil

The tube does run out of the M25, as far as Amersham. If we were to go back many years places like Heathrow and perhaps even Watford would not be considered part of London. Even Kingston was not fully absorbed into London officially until the 60s. It is eventual that London will absorb beyond the M25. You are right though, proximity and ease of access to London makes a huge difference to effect you will see on property prices.

[Deleted User]

Well I'm glad there's a good deal of green belt land between me and London (I live about 1/2 a mile from the M25)

What I'm really getting at is that house prices are not as bad as the OP is worrying about

AndyGuil

ringo_24601 wrote: »

Well I'm glad there's a good deal of green belt land between me and London (I live about 1/2 a mile from the M25)

What I'm really getting at is that house prices are not as bad as the OP is worrying about

Definitely not, unless the OP is looking for a large house in zone 2 london then there may be some disappointment.

onlyroz

Where on earth are you living? Here in Berkshire there are plenty of 3-bed semis on sale for £300k or less.

The_White_Horse

Loughton_Monkey wrote: »

It doesn't work like that!

Do you think these are first time buyers?

Here's a rough guide to how they could buy.....

Buy for £6,200 in 1973 and sell a couple of years later at 18% profit. Increase the mortgage by £4K and buy for £11,750 and sell for £15,750 (up 34%) in 3 years. Up the mortgage another £3K and buy for £18,900 and sell at 81% profit for £34,260 3 years later. Then yet another £4K on mortgage and buy for £38,500, selling 3 years later for 23% more - £47,500.

Now put another £10.5K on the mortgage and buy for £58,000, selling 6 years later for a 132% profit at £135K. By then, you can up your mortgage by a hefty £35K and buy for £170K, selling for substantially the same price 10 years later because there was a crash!

Another hefty increase of £120K on the mortgage [because you're earning a good deal more after that 10 years] lets you buy for £295K. Spend a bit of money on the house and 15 years later, it will have gone up 238% to a cool £1m, by which time the mortgage of barely over £200K is paid off.

Very broadly, that's how I did it, and could therefore buy one of those £1m houses for cash if I wanted to move nearer to London (which I don't). It really isn't difficult if you have a 'decent' career and move about a bit.

and if you can't go back in time to 1973 to buy your first house for less than a second hand fiesta????

how do the people do it that started buying in say, 2003/4 do it?

They paid, say £180k for a flat in 2004. Sold it in say, 2007 for £200k. They then got a massive mortgage to buy a 3 bed semi for £320k. That 3 bed semi is now worth say, £360k. So, in the 10 yr period they have made 80k in equity and paid off say, £20k plus their initial 20k deposit. So, when they move, they have about £105k to put down after fees and stamp duty. To get their next home, they need a mortgage of probably £380k at least. They probably aren't earning that much more than they were 7 or 8 yrs ago.

The_White_Horse

also, are you saying that the only people that can buy "family homes" in London and surrounding areas are people who first bought in 1973. So if they were 20 then, they would be 61 now. probably looking to downsize - not buy big. A family in their 30's will want to buy this £1m house not a couple in their 60's whose kids are probably grown and left.

AndyGuil

I family in their late 30s is a reasonable market for these houses. In future when these houses are more then the FTBs of today will become the market as they build equity and cash over the next 10-15 years.

Sellotape

It really worries me. I thought we had a good joint income til I realised we will likely never be able to afford a house, even in a London commuter town.

Makes me wonder if we should relocate cities.. London is unsustainable but the Gvnt don't seem to be worried because the rest of the country isn't in the same situation. Can't controls be placed on London? It's a pan of boiling water ready to spill over.

Or it becomes a place that only the very wealthy can live in.

AndyGuil

Sellotape wrote: »

It really worries me. I thought we had a good joint income til I realised we will likely never be able to afford a house, even in a London commuter town.

Makes me wonder if we should relocate cities.. London is unsustainable but the Gvnt don't seem to be worried because the rest of the country isn't in the same situation. Can't controls be placed on London? It's a pan of boiling water ready to spill over.

Or it becomes a place that only the very wealthy can live in.

If people can't afford it then they will stop living there. It is the most in demand market there is, clearly people can still afford it. It is helped quite a bit by the greater salary. Once on the ladder it is also much easier.