House prices

westernpromise

Crashy_Time wrote: »

The banks?

Are you under the impression that banks own residential property, Crashy? Really?

Here's a thought experiment for you.

1. A bank lends £100k to buy a £120k house.
2. The house falls in value to £90k.
3. Does the bank's balance sheet

• show a negative change
• show a positive change
• not change at all?

westernpromise

Malthusian wrote: »

Government helps guy who can afford a house worth £160k (£10k deposit and £150k mortgage) to live in a house worth £200k. Three years later, after putting in 160k including mortgage, his share is worth £216k, and he is living in a house worth £270k. From putting in £10k plus three years' mortgage repayments from his own pocket, he now has £76k net of the mortgage. As a result he is hacked off.

You could not ask for clearer proof that all politics is a total waste of time. People are never happy. Not as a result of anything you do for them unsolicited using other people's money, anyway.

OP - just sell and be a renter again. Then you will be in the same position you would be if the Government had never come up with Help To Buy, but with your share of the house price growth in your pocket.

He's a snowflake, probably. Wants it all on a plate.

NineDeuce

A lot of people could afford the houses they live in if they werent restricted by huge deposits. Mortgage payments invariably are indifferent to rental payments.

This is the issue.

Batman2017

House prices over the last few years have spiralled which makes it hard for those who want to second step.

E.g FT buyer buys a house for 100k, the house then increases by 20%. £120k. Problem is the house that was 200k is now £240k. Thats a real terms difference of 20k that the buyer needs to find from deposit or mortgage borrowing.

I'm a first time buyer and have been living in my property for 6 years. It has a 2nd charge on it from the builder which is interest free for ten years.

We looked at buying last year and were shocked that one house in Coventry we looked at had increased by 100k from 150k to 250k in 3 years with no home improvements. Estate agent said it was just a desirable area.

The banks, Estate agents, goverment(taxation) all win with higher house prices.

Who loses?

HPC_Ghuol_Hunter

Batman2017 wrote: »

House prices over the last few years have spiralled which makes it hard for those who want to second step.

E.g FT buyer buys a house for 100k, the house then increases by 20%. £120k. Problem is the house that was 200k is now £240k. Thats a real terms difference of 20k that the buyer needs to find from deposit or mortgage borrowing.

I'm a first time buyer and have been living in my property for 6 years. It has a 2nd charge on it from the builder which is interest free for ten years.

We looked at buying last year and were shocked that one house in Coventry we looked at had increased by 100k from 150k to 250k in 3 years with no home improvements. Estate agent said it was just a desirable area.

The banks, Estate agents, goverment(taxation) all win with higher house prices.

Who loses?

Alternatively you could more to a less desirable area where you can afford the next rung on the ladder. Cut your coat according to you cloth, so to speak.

gazzabboi

westernpromise wrote: »

He's a snowflake, probably. Wants it all on a plate.

You are obviously an old guy who already has his mortgage paid off and can't wait for prices to rise laughing at the less fortunate.

I'm a mid 20s lad on the average salary with kids. How can it be good for me knowing that prices have gone from about 5 times my wage to 10 times in the space of 3 years.

So not a snowflake, I'm a hard working lad living in the struggle. Happy that I've gained equity, but no better off despite it as I can't move up.

Koldweather1

I can understand where you are coming from gazzabboi, but without your house, you could have been paying even more on rent.

I've recently got a mortgage for a house (I'm 27, so probably similar age) and personally I've got enough equity to cope with a decent drop in house prices and I have every intention of overpaying the mortgage enough to try and reduce any blow dropping prices will have.

My gut is we are going to get kind of a Japan situation with a slow and steady drop in house prices for a sustained period of time until wages increase relative to inflation for a sustained period of time. Interest rates aren't going anywhere north too quickly so not enough pressure to force people to sell at largely reduced prices, thus why I think any drop is going to be shallow.

Conrad

Malthusian wrote: »

Government helps guy who can afford a house worth £160k (£10k deposit and £150k mortgage) to live in a house worth £200k. Three years later, after putting in 160k including mortgage, his share is worth £216k, and he is living in a house worth £270k. From putting in £10k plus three years' mortgage repayments from his own pocket, he now has £76k net of the mortgage. As a result he is hacked off.

You could not ask for clearer proof that all politics is a total waste of time. People are never happy.

I have clients that have experienced similar to the OP, but unlike him they have a positive can-do outlook and would be most perplexed by his outlook.


All my adult life I've heard the cookie-cutter refrain 'it's crazy my house has gone up this much, something has to give', it's just one of those ever-present memes whether it's 1985 or 2017, nothing changes.


A proportion of the population always whinges they cannot move up market, hey ho, but be assured the majority will move up market as will the OP once he thinks it through calmly one day in the future.

Guess what prices will always go up over time with the occasional downswing here n there. We live on crowded island.

MobileSaver

gazzabboi wrote: »

I'm a mid 20s lad on the average salary with kids.

I'm almost twice your age and yes have paid off my mortgage but like most similar people here am not laughing at anyone.

gazzabboi wrote: »

I'm a hard working lad living in the struggle ... but no better off despite it as I can't move up.

The sense of entitlement of your generation is palpable. I'm quite sure you could "move up" either by buying a bigger/better house in a different area or by working harder/longer and therefore earning more but as so eloquently put by westernpromise, you do want it all on a plate.

There's no question in my mind that your parents have to take some of the blame but ultimately it's you and your generation whose default position always seems to be "it's someone else's fault" regardless of what the "it" is!

I'm a relatively wealthy guy but that still doesn't mean I can have anything and everything I want; there are certain thing I would like to have that I simply can't afford or justify. The difference between us that I don't go around complaining how unfair life is because of it...

Koldweather1

Mobilesaver, I think you would agree your generation had it MUCH easier when it comes to property and prices? Thats a fair comment?

Anyway at least OP you have a place to call your own, many people have to rent a similar sized place...and some people aren't even THAT lucky. So whilst your struggling to move onto the next step, your further along than many of your age are.

Personally I've had to move to another county to afford a house. My mindset is roughly the same as when I was paying rent though, and the surplus is going straight into overpayments. Of course I have just a pure mortgage rather than the S/O solution which obviously must limit you somewhat.