Rent now, wait for the crash and then buy?

regprentice

Its wishful thinking that there will be a house price crash in the near future. Uk govt is absolutely dead set on propping up the house price bubble with policy after policy.

When the next crash does come, as others have said, it will be as a result of or alongside other significant economic events the govt has tried but failed to manage. I believe i have recent read that, if we manage another 2 years without a recession, then it will have been the longest gap between recessions since the great depression...so its fair to say that a recession 'should' be imminent. But if you lose your job your plan will be out of the window...

redned_2

As someone who has been out of the property market for two years while looking (and hoping prices would come down) I would strongly make the case for buying sooner! If the prices come down, as stated so will everyone elses, if they go up you're basically stuffed! It is only a problem if you are likely to need to sell in the near future for some reason. Better to be 50K worse off but have a house...buy a house to live in not to make money;)

AdrianC

Let's say this crash does arrive.
What will cause it? Lack of affordability.
What does that mean for most people? Inability to get a mortgage.
So what's so special about you that means you will be able to get a mortgage when so many others can't...?

adonis10

AdrianC wrote: »

Let's say this crash does arrive.
What will cause it? Lack of affordability.
What does that mean for most people? Inability to get a mortgage.
So what's so special about you that means you will be able to get a mortgage when so many others can't...?

A 60-70% deposit?

Brock_and_Roll

There are guaranteed to be times in the future when house prices fall substantially, plunging a number of "late entrants" into negative equity.


But of course there are also likely to be period where house prices rise substantially over a short period resulting in a big paper gain for owners.


However, predicting either or these periods has historically proved almost impossible - like stock market crashes, their very severity is caused by the uncertainty i.e. no one expects it to happen until it does, then takes everyone by surprise.


So wherever we are in the cycle, the most important thing a prospective buyer should consider is whether they can ride the wave - how much deposit do they have? How secure is their job? and Could they still just about get by paying the mortgage if rates were 8% for a period.

Marvel1

Bought in 2007 just before the crash and peak, not recovered, am I bothered? Since I cannot be bothered to move, not really. My mortgage payments is much cheaper than renting.

AdrianC

adonis10 wrote: »

A 60-70% deposit?

So still a 30-40% mortgage. Not that unusual, once you get past FTBs.

eddddy

adonis10 wrote: »

I do get the whole "buy a home to be a home" idea but am still petrified that the next crash could wipe 50-100k off a house I buy, and never recover thus meaning it'd be rather difficult to move again.

It's a complex topic, but bear in mind that...

- if a crash causes your house to drop by £50k, the house you want to buy next will also have dropped by £50k

- and if you're upsizing, your house has dropped by £50k, but the bigger house you want to buy next may have dropped by £75k.

(Although, it's more difficult if the drop puts you in negative equity.)

There's an argument that it's less risky to stay in the property market as it rises and falls, rather than trying to judge when to jump in and out at the right moments.

[Deleted User]

What will be will be I'm afraid. No one can give you a definitive answer.

If you are that desperate to buy a house buy something that is suitable for any future plans you think you may have (e.g. big enough for a family).

mrginge

I believe there is a nuclear winter pencilled in for 2065. Probably best to wait until after then tbh.