'We've reached a tipping point' Signs of house price weakness

wotsthat

Crashy_Time wrote: »

As long as the area stays nice, and the neighbours are not a problem, and the government doesn`t decide to tax you because they can, super, well done. If I don`t like the colour of my wall paper I can move in a day if I want to, no need to wait for someone to buy it off me.

So if someone buys with a mortgage they're a debt serf and if they own outright then there's all the hassle of selling to move.

Are you new to HPC too? Although it appears they want to spend a lifetime renting the strategy is meant to end with blissful home ownership.

padington

Crashy_Time wrote: »

if you want to believe that the western banking system is solvent, well good luck to you.

To be insolvent you have to run out of money, is that going to happen if you can print it ? Or are price rises a more likely consequence of problematic national debt?

quantic

People said this to me in 2010, prices have not yet crashed, don't buy yet. Couple people I know took this advice and rented instead, hoping for a crash. We just sold the house we bought in 2010, and made "profit" of £20k. The area we have just sold in is pretty poor too and still struggling. Could have made much more had we bought in a more affluent area.

I appreciate that this money is not going to be mine, but had we waited til now to buy or even later, the house we are now buying would have been impossibly out of our reach.

If you add together the profit, repayments and initial deposit we are walking away with £57k. Had we rented we would have thrown away 4 years of rent and the house we wanted to buy would still have gone up in price.

The way I see it, there is a risk you will lose money buying a house, but when you rent its guaranteed.

mayonnaise

I got to say, our own homegrown MSE bears are definitely of a much higher calibre than this rabble coming over from HPC...

lukeh23

quantic wrote: »

We just sold the house we bought in 2010, and made "profit" of £20k. The area we have just sold in is pretty poor too and still struggling.

....sigh......

chucknorris

Crashy_Time wrote: »

So you have 600k of debt, the property crash will affect you, but you still feel OK?...OK.

No I don't feel Ok, I feel very happy about my financial position, I said that I would be OK (in a crash), not that I felt OK.

Percy1983

I will say its not worth talking about your own situation, as it will be twisted to fit somebody elses needs.

ie, there is 2 things which come to mind which have been completely fabricated about me, yes there is many things which are different opinions but others are just plain lies.

1, I don't have an up to date DBS check (I work with children sometimes), ps, I am registered on the DBS update service so I am constantly up to date.

2, I have a failed business behind me, don't know where this came from at all, I am actually running 2 businesses at the same time both of which are turning a profit.

Anyway back to it, I do believe anybody who chooses to rent when they could buy a home with no need to move quickly etc does need to think about what they are doing.

I am not going to say houses on go up in value, this isn't strictly true, but the long term trend is upwards and I don't see that ever stopping even if its only inline with inflation.

lisyloo

I understand the arguments about buying Percy - indeed I'm a homeowner, but it only works long term.
I'm currently thinking of buying a 2nd home in London but we won't be there long long term (don't know exactly when retirement will be) plus on a contract that could end at any time. I guess there are excellent job prospects certainly relatively speaking, but there are a number of risks for people who don't have a full time secure job or can't guarantee they'll be living in a area for a long time.
The transactional costs have to be taken into account over smaller periods.

I have no axe to grind in any direction as I'm trying to work out the best thing to do but can't get a mortgage right now anyway (only 6 months worth of "books").

Also I've observed recently that if I take short term accomodation e.g. £90 per night appartment, I can live in nice/commutable areas (like Earls court) that I would struggle to afford to live in.
It's not a straightforward decision if you don't know whether you will be somewhere for a long time.

Percy1983

I agree that if you are only stopping somewhere a short time its not always best to buy.

I guess I am aiming more at those renting while waiting for a crash, the amount you lose in rent payments make it near impossible for a crash to be worthwhile.

lisyloo

Doesn't that depend on the maths? and also the sacrifices one is willing to make?

I do agree that there's a big risk of being priced out of buying especially in London.
But in principle if you were prepared to rent a hovel what you might lose in rent payments might be less that what you'd need to pay to rent the money with a mortgage (plus the additional costs of maintenance and buildings insurance of course) and therefore you could save some as well.

I totally acknowledge this would be hugely risky (especially in London) with the capital gains side, but I'm not sure I agree that buying would always be cheaper than renting. It depends on a number of factors.

Once thing I've noticed is that you can't always compare like-with-like.
As I've said there are places in London I could afford to live in short term accomodation but I can't afford anywhere I'd be prepared to buy.
That's partly because there are places I'd be prepared to live short term that I wouldn't want be prepared to buy as a home.

I really don't think there is any "one fits all" answer, I do agree that those waiting for a crash are playing a high stakes game.