Are house prices falling?

Woby_Tide

meanmachine wrote:

Why on earth do you think banks are any more able to predict the future than you or i?

Those clueless banks with their billion pounds profits, what a lucky guess, year after year, bounders the lot of them

meanmachine_2

Woby_Tide wrote:

Those clueless banks with their billion pounds profits, what a lucky guess, year after year, bounders the lot of them

More to do with them covering their bases. In a recession they do well, in a boom they do well. At all other times they do well. It's called diversification.

But as far as I'm aware banks are advised by economists, not visitors from the future, and economists can't agree on the weather, let alone anything more meaningful.

Until banks really take a risk and give people 25 year fixed mortgages, they're taking no risk at all.

I should imagine that fewer than 5% of all mortgages are fixed for longer than 2 years anyway, so future IR rates aren't really an issue for them.

t_i_g_e_rr

deemy2004 wrote:

All those who are now posting that house prices will not tumble will be eating their hat, shoes and smelly socks in 12 months time....

Those who have been predicting a crash are fed up with the taste of hats. Five years of eating hats is enough. However, in recent months I have noticed that the people predicting a crash have stopped eating hats. This leads to a very simple economic conclusion: if there is an oversupply of hats, the people who are not eating hats will have to start. Therefore there will be a crash. Of course, eating hats makes you mad!

meanmachine_2

Well, the Nationwide has revised its house inflation prediction from 2% down to somewhere between 0% and 2%.

I'd be happy with that. In real terms that's a loss. Means I'm in absolutely no hurry to buy a thing. Tum tee tum....

Now who's going to buy all those overinflated one-bed dives?

Not I.

deemy2004

Remember what they said about the unsinkable property - The Titanic Housing Estate, that it would never sink... well we saw what happened when it hit the interest rate iceberg

GingeG

On a serious note guys I am about to start my negotiations on a property for £219,950.

We are first time buyers with a mortgage in the bag as last house fell trhough at last minute!

Seriously bearing in mind prices are likely to drop a little waht should I expect to pay for this place I reckon 205K is fair any opinions??

GingeG

I should have said that is just over 93% of asking price which is what I believe they are all going for (cant believe its only a 3 bed semi)

meanmachine_2

GingeG wrote:

I should have said that is just over 93% of asking price which is what I believe they are all going for (cant believe its only a 3 bed semi)

Pay what you can afford, no more.

Prices aren't likely to change much in the shorter term. So only if you can afford to wait would I advise you to do so.

But it's up to you. A 200K mortgage for a FTBer sounds huge to me, but since I don't know your circumstances, if you're comfortable with it, then that's your look out. If you can afford to service the debt should interest rates double (worst case scenario), then you should be OK.

Have you looked up the property on nethouseprices? That might tell you what the previous owner paid for it and how much profit they're trying to squeeze out of you.

GingeG

Mean Machine,

Thanks for your sensible reply. Wife and I both work and have no kids or debts. So we can afford the £1083 a month repayment on a fixed 5 year term.

I have reservations about this though as it is expensive. The vendors paid 120K 5 years ago, dont think they are trying to rip us off with asking for 220 cos thats what all the houses have done country wide is jump up.

I just wanna pay them a fair price. When do we think prices will start to come down then?

bridiej

No one knows when prices will come down!

Just offer what you're prepared to pay for the house, what YOU think it's worth and take it from there.