Advice - negative equity

harrys_dad

If as you say it was intended as a long term investment just live in it long term and enjoy it. If it is going down in value so is anything else you might eventually want to move into. If in fact in the future you want to move UP the supposed property ladder then the rungs are getting closer together and you will find bigger/better houses closer in price to yours.

When I first considered moving into my current area my house was valued at £175000 and the sort of house I would consider buying was £260,000. Three years and a financial crash later I sold my house for £130,000 and bought my current lovely house for £192,000. Although my original house had "lost" £45,000 in value my "price to change" had actually fallen by £23,000, and this was real extra money I didn't have to splash out.

bouicca21

House prices have fallen before, it's almost inevitable after a steep rise. Unless you actually have to move just hang on in. A house is a home not just an investment.

warby68

If your house has fallen in value then it won't be in isolation so any property you might want next will, in all probability, be worth less too.

If you're trying to sell so you can buy again at the perceived bottom of the market that's quite risky, very difficult to predict and time.

Each time you sell and buy the costs are considerable - rather than incur those costs twice more short term it may be better protection to throw extra at your mortgage and maintain/increase your equity. The main short term problem for you is probably if your mortgage deal needs renewing and your LTV is now higher so this would build some protection in.

I'd love to have been a fly on the wall when you tried to tell your neighbours how to price their property :eek:

pinkfluffybabe

sarahc81 wrote: »

We're able to put our property for sale now if we need to. Someone further down the road has listed theirs and reduced the listing price so that it's around £40k less than what we paid. My husband and I did go round to speak to them and explain we may also try to sell soon and that lowering the price like this isn't in any of our interests but they've kept it at the same level.

Did you really do this :rotfl:

HampshireH

The fact house prices were predicted to drop at some point isn't new. It most certainly should be something you consider in the pros and cons when buying property and investing long term ...... a bit like interest rates....... which are also going to go up as well as prices falling to a degree.

Sit it out. Or you will lose more money buying and selling because you are constantly reacting to the market.

No come back on being unsold given bad advice Because you werent. You were given advice relevant at the time.

Things change.

As for asking the neighbour to raise his value. Wow!

They will have put their house on the market and priced it to sell in the current climate based on valuations given. To expect them to do anyone any favours by pricing it out of the market is crazy.

pinkshoes

sarahc81 wrote: »

This was intended as a long term purchase and not an investment. We are living in the property having lived with my husband's mother for several years.

The value of your HOME is IRRELEVANT if you are not planning on selling.

You have just said it is a long term investment, so what's the issue???

So it is now worth less than you paid for it, and you are thinking of selling, moving back in with your mother in law (?), then taking out a loan to cover the debt??? Just on a whim that when you do come to sell many years down the line, it might be worth less than it is now...?

Are you crazy???

Just enjoy your home and stop seeing it as a pile of cash!

I couldn't care less what my home is worth. It is my HOME. I am not moving until at least retirement if I can help it, and that is 25 years off!

davidmcn

sarahc81 wrote: »

Also does anyone also know if there are possible legal options for the advice we were given? Prices in the area had increased a lot over the last 2-3 years before we purchased. It has a 35 minute rail link to London and we were assured by the estate agents that it was a good purchase. The surveyor also agreed with the valuation and the bank must have also agreed as it provided the mortgage against it. It seems unfair that they can provide all of that advice then walk away when it's incorrect and we're left to suffer and deal with the consequences.

Whatever the estate agent said to you, it wasn't "advice", just sales patter on behalf of the sellers.

The bank didn't give you any advice about the value of the property, they just told you what their valuer had told them the value was.

Your surveyor (if you did get your own survey?) would have told you the valuation at the time they valued it. Not a prediction about what would happen in the future - because nobody knows that. If you can prove that they were negligent in their valuation and that you therefore suffered a loss, then you might have a case against them. But I can't see that you do from what you've told us.

Keep_pedalling

I can't believe that there has been such a price reduction in Herts. According to the link average prices in the county had risen over 9% in your first year of ownership. Are you seriously suggesting that you missed out on that and have lost a further 10% since Feb?

http://www.hertfordshiremercury.co.uk/house-prices-in-hertfordshire-among-fastest-rising-in-britain/story-30219516-detail/story.html

_CC_

sarahc81 wrote: »

However the news about interest rate rises and the economy means we don't know whether it's better to try and sell now in case they continue to fall.

A prolific poster on here did just that in 1990's IIRC.

Maybe they'll share how that worked out for them?

Cakeguts

While you are living in a house it has no monetary value. You can only get the money out when you sell. It doesn't matter how much you sell it for if you have lived in it as a home and paid as much mortgage off as you can.

A mortgage is a loan to help you buy a house. Why would you not try to pay off as much of the loan as you possibly can as soon as you can so that you don't pay lots of interest.

There is no point in worrying about what a house is worth when you are living in it.