Buy now or wait?

IveSeenTheLight

Dave93 wrote: »

Knowing St Helens is still 10K below 2007 is very interesting seeing as it is most likely the place we will buy. Once we own we would be saving for pension, and building up a healthy amount of cash so that later in life we are not job reliant, can cut our hours and hopefully even retire early. We are also unmarried with no children and that seems to be the next step after buying a house, so there is that to think about as well.

Thank you for all of your research and insight, it has genuinely helped me more than any bank, article or friend/family member and I am already feeling in a much more confident and knowledgeable to help make a decision.

We sound so similar, just a different generation maybe

Saving for the future can be done by investing in the house.
We renovated, paid down mortgages (although check rated you are on) and upsized as much as we could before children came along.

It meant we were financially secure and could afford to live off one wage when our children were born.

As for pensions, one option we have is to downsize in the future, once the children have become independent.

If you research the net migration and house building statistics, there is an increasing need for homes and as such makes it a strong opportunity to be able to downsize in the future.

I see this continuing unless house building exceeds net migration requirements and catches up the the shortage for a number of years.

There will be plenty of warning if there is a risk to the property needs.

Dave93

mollycat wrote: »

Dave....thanks, I wish you well

Something that may or may not help, from the perspective/experience of someone much older....

Self and partner have had long term desire of living in London.

10 years ago could have afforded to buy someplace, thought prices a bit dear, so decided to wait.

Could have bought 5 years ago but this would have taken pretty much all of our free cash, so decided to wait, (for a crash).

Forward to present day; nothing remotely affordable for us now, likely never will be.

Do I wish I'd bought 10 years ago? Yes.

Do I wish I'd bought 5 years ago? Yes again!

I know this tale has limited relevance to yourself, but there's a lesson in there someplace.

Like I say, good luck.

There is definitely something I can take from that, thank you for sharing that with me. It's funny, family and friends around me have all suggested keep renting, spend on holidays and enjoy life and then think about a house in a few years. This has never felt like a sensible decision to me and the input from you guys on this thread has cleared the water for me massively.

Slinky

Dave93 wrote: »

There is definitely something I can take from that, thank you for sharing that with me. It's funny, family and friends around me have all suggested keep renting, spend on holidays and enjoy life and then think about a house in a few years. This has never felt like a sensible decision to me and the input from you guys on this thread has cleared the water for me massively.

Is that because the people you are asking rent their homes and spend their money on holidays and enjoying life?

One thing I haven't seen mentioned, how confident are you that your OH will be able to get a job commutable from where you plan to buy?

Dave93

IveSeenTheLight wrote: »

We sound so similar, just a different generation maybe

Saving for the future can be done by investing in the house.
We renovated, paid down mortgages (although check rated you are on) and upsized as much as we could before children came along.

It meant we were financially secure and could afford to live off one wage when our children were born.

As for pensions, one option we have is to downsize in the future, once the children have become independent.

If you research the net migration and house building statistics, there is an increasing need for homes and as such makes it a strong opportunity to be able to downsize in the future.

I see this continuing unless house building exceeds net migration requirements and catches up the the shortage for a number of years.

There will be plenty of warning if there is a risk to the property needs.

You sound like what I hope future me is saying to somebody else in the future. You have planned and lived the life I am trying to plan - Thank you for all of your help.

Slinky wrote: »

Is that because the people you are asking rent their homes and spend their money on holidays and enjoying life?

One thing I haven't seen mentioned, how confident are you that your OH will be able to get a job commutable from where you plan to buy?

Its a mixture of family members who had the luxury of buying when house prices represented 3.6 times salaries, so are now sitting comfortable. And friends who are for the most part renting/living with parents and blowing every penny they have.

Regarding my OH, she is the reason we are living in the area we are; both of our families live local and she doesn't want to stray too far away from the pack. So her location will decide her job rather than the other way around. We may have the need to change location once she gets a job, but it wouldn't be anything drastic and would most likely be a change in location to make our daily commutes a bit easier.

tom9980

yes my income was just student loans at the time.

I would like to see some projections, you should work out all the costs of buying and the costs of renting over various periods of time.

Renting over short periods can be more cost effective when you consider stamp duty, solicitor fees, refurbishment and repair costs you would inevitably make if the house you buy needs work. It may make some more sense if the work involved can be DIY'ed to a high standard, but generally work done refurbishing a home doesn't mean the house will increase in value by the amount you actually spend.

Also base projections on you buying and there being a 30% crash, 15% crash, stagnation, +10% and +20% increases in house prices. It is important to remember there are people still coming to these forums who are in negative equity from the credit crunch. So take a bit of time to run some numbers and work out how that would effect your future plans.

fangoose

Mortgage rates are low at the moment so you may get a good fixed deal. I have noticed with savings accounts it looks as though they are hedging towards interest rate increases soon with inflation running higher will have to wait and see! If you are content that you can afford a house to live in that you actually like then why wait? At least once it's done, you won't be worrying about it

IveSeenTheLight

tom9980 wrote: »

yes my income was just student loans at the time.

I would like to see some projections, you should work out all the costs of buying and the costs of renting over various periods of time.

Renting over short periods can be more cost effective when you consider stamp duty, solicitor fees, refurbishment and repair costs you would inevitably make if the house you buy needs work. It may make some more sense if the work involved can be DIY'ed to a high standard, but generally work done refurbishing a home doesn't mean the house will increase in value by the amount you actually spend.

Also base projections on you buying and there being a 30% crash, 15% crash, stagnation, +10% and +20% increases in house prices. It is important to remember there are people still coming to these forums who are in negative equity from the credit crunch. So take a bit of time to run some numbers and work out how that would effect your future plans.

Some good advise, but I'd be interested to hear of those in negative equity from more than 10 years ago.

I cited above that St Helens was still £10k down from peak 10 years ago, but that's assuming someone bought at peak. I'd also expect that more than the £10k had been paid down during the 10 year amortization period.

Certainly there is always a short term risk with negative equity, but with property, if prepared for the long term, the risk can be managed if it occurs

cashbackproblems

IveSeenTheLight wrote: »

We sound so similar, just a different generation maybe

Saving for the future can be done by investing in the house.
We renovated, paid down mortgages (although check rated you are on) and upsized as much as we could before children came along.

It meant we were financially secure and could afford to live off one wage when our children were born.

As for pensions, one option we have is to downsize in the future, once the children have become independent.

If you research the net migration and house building statistics, there is an increasing need for homes and as such makes it a strong opportunity to be able to downsize in the future.

I see this continuing unless house building exceeds net migration requirements and catches up the the shortage for a number of years.

There will be plenty of warning if there is a risk to the property needs.

I think this is rather simplistic, the reason for house price inflation has been due to unprecedented low interest rates, BTL boom and easy credit, all which can and is changing e.g. BTL taxes. Prices do simply not go up due to population and demand


don't get me wrong I have just bought my own place and think if you find the right place it is worth going for it. But don't feel like prices will increase much over the next 5 years due to brexit.

Dave93

tom9980 wrote: »

yes my income was just student loans at the time.

I would like to see some projections, you should work out all the costs of buying and the costs of renting over various periods of time.

Renting over short periods can be more cost effective when you consider stamp duty, solicitor fees, refurbishment and repair costs you would inevitably make if the house you buy needs work. It may make some more sense if the work involved can be DIY'ed to a high standard, but generally work done refurbishing a home doesn't mean the house will increase in value by the amount you actually spend.

Also base projections on you buying and there being a 30% crash, 15% crash, stagnation, +10% and +20% increases in house prices. It is important to remember there are people still coming to these forums who are in negative equity from the credit crunch. So take a bit of time to run some numbers and work out how that would effect your future plans.

Great advice, I will be sitting down with the OH crunching the numbers; she is doing Mathematical Science and I'm a Project Manager so we should be able to figure it out between us :P LOL

fangoose wrote: »

Mortgage rates are low at the moment so you may get a good fixed deal. I have noticed with savings accounts it looks as though they are hedging towards interest rate increases soon with inflation running higher will have to wait and see! If you are content that you can afford a house to live in that you actually like then why wait? At least once it's done, you won't be worrying about it

Very true, we have some house viewings arranged and a couple of second visits to houses we have previously been to. I guess our lack of experience, uncertainty about the future and general anxiety of buying a home has made us hesitant and we want to make sure we are doing the right thing. You guys and your kind and helpful advice have seemingly convinced my OH that it is the right thing to do which is a huge step forwards. Just got to sit down and work out the numbers so we are 100% clear on what it will cost to buy now vs rent then buy later (projected costs as Tom suggested above)

IveSeenTheLight wrote: »

Some good advise, but I'd be interested to hear of those in negative equity from more than 10 years ago.

I cited above that St Helens was still £10k down from peak 10 years ago, but that's assuming someone bought at peak. I'd also expect that more than the £10k had been paid down during the 10 year amortization period.

Certainly there is always a short term risk with negative equity, but with property, if prepared for the long term, the risk can be managed if it occurs

If we bought now, I guess we would be holding onto the house for at least 5 years - more if we were in negative equity. Once we get our hands on our first home there would be no need to rush into moving on, so I guess there's no time like the present...

cashbackproblems wrote: »

I think this is rather simplistic, the reason for house price inflation has been due to unprecedented low interest rates, BTL boom and easy credit, all which can and is changing e.g. BTL taxes. Prices do simply not go up due to population and demand


don't get me wrong I have just bought my own place and think if you find the right place it is worth going for it. But don't feel like prices will increase much over the next 5 years due to brexit.

I didn't think prices would be increasing much, if at all myself - and I was worried that we would end up making a mistake by buying now. But from the feedback from all of you guys i think we are going to go for it if we find the right place that we can rework and invest in. Holding onto it for a length of time isn't a problem for us providing we can find the right area

Pixie5740

Before getting too excited go and speak with an independent broker rather than the chancer you saw at the bank. That should give you a better indication of your budget.