1st Time Buyer help !!!!!

william_conrad

http://www.youtube.com/watch?v=11MaFlOiSsk

izzybusy23

lypsey wrote: »

I have copied and pasted from repossessed property thread tha is running but it also applies to you
"Take five minutes to look at what is happening in the stock markets , read up on hedge funds and also the carry trade. Billions and billions had been made through very very very cheap credit over the last 5 years . This is starting to end.

It was muted on Five Live this morning that one of the UK banks (can't remember if it was Brad & Bing or Northern Rock) but they were suggesting we could have a major bank failure . Before you all laugh how insane a suggestion this is , I think you will find 80 banks in America have gone bust THIS YEAR and the BIGGEST US lending bank called Countrywide which is nothing to do with the English company with the same name is close to bankruptcy with its share going down 59% in the last week or so.
You will see that ALL the banks start to rein in the offers of 5 times and 6 times salary , 125% mortgages , interest only mortages etc. I believe now that interest rates may be at there peak but don't get excited because I also believe that the money markets will make the interest rates over the next 6 month and you could see the borrowing rates climbing far and beyond the central bank rates
My question to you is what effect will this have on UK house prices , I would suggest catastrophic , I can see house price fall of 50% of the next 5 years , so gentlemen be careful"

I was in negative equity on the last house price crash and I can tell you it is miserable. The fundementals dont stack up
1) As mentioned above we have 1.3 trillion pounds of debt
2) Average house 200k , average salary 23.5 k = average borrowing is 8 times salary . Even in the last crash it wasn't this high
http://www.in2perspective.com/nr/stats/house-price-to-earnings-ratio.jsp
My 3 year old will tell you whats going to happen with this graph
3)BTL doesn't make finacial sense now , you can get better value in the bank and it has been BTL that has been the "bottom rung" of the ladder
4)Take a look at the property shares such as Persimmon , wimpy , barretts , their shares are down big time. The city (smart money) know whats going to happen in the housing market. Also take a look at Brad & bIng and Northern Rock even before this weeks crisis they were in severe trouble and they lend a lot of money to the BTL market
5) The lowest number of 1st time buyers in history ... why
I could go on

Good post.. quite scary really with all that is going on in the stockmarket at the moment. I think its Northern Rock that you are referring to as they have been the main cuprits of the UK's 'subprime' mortgages.

I have never been one to join this madness and am quite willing to save hard for a decent deposit for the next five years in the hope that the housing market has corrected.. if that means buying in my 40's then so be it.. rather be 40 and more financially savvy than a 20+ year old struggling with mortgage payments and debt just to jump on the bandwagon.

Good post.. thanks.

Scouse_Skip

Hi all, certainly gives you something to think about !

david89999

Scouse I have sent you a private message with my recent experience detailed (I could almost be twins with you, situation wise!)
I have done it by PM, through bitter experience of telling my tale, and the thread being hijacked by people in ivory towers going on about the folly of house buying etc. (I wonder how many of them live in council accomodation?)