House Price Crash Discussion Thread

SJ1

The thing I always wonder when I read stuff like this is why does it matter and this is why....

1.you buy your house in an area that works for you re jobs etc
2.you work our how much you can afford - you put in a good deposit and you work out that the repayments will be within your budget
3. if you feel you might be close to the mortgage payment edge you fix the rate thus guaranteeing your repayment for years.

So who cares if the actual value goes up or down - if you can afford the repayment then it doesn't matter. The thing I worry about is what will happen to interest rates in the medium/long term. If those start to rise then we will all be in the sticky stuff. In the 80's when the last crash happened lenders just adjusted their products and let you take the negative equity with you.

I wish people would stop talking about a house as if it is an investment - it's a home to live in. If it goes up well done you, if it doesn't then you haven't been so lucky although hold tight and the likelihood is things will be fine.

S

sabretoothtigger

Well said. Ultimately houses do save people money because it should be cheaper then renting but this whole get rich quick idea is dying a slow death it seems.
Finance is the largest cost, its not right now but over a 25 yr term I doubt Brown has reversed gravity somehow

kad1

Hi all. I'm hoping to benefit from your fountain of wisdom...

I've been in my flat now for nearly 3 years on a shared ownership basis. When I bought in 07 the flat (new build, 2-d/bed rooms in a 2-story block, kitchen furnished) was £182,500. I bought a 70% share (£127,750) and taking into account the deposit I put down, was given a mortage of £107,750.

I put my flat details through Zoopla and was given the estimated value of £169,109 with a range of £152,199 - £186,019. I am now considering buying the remaining 30% but would like your advice as to whether now is a good time to do so? Should I wait a little longer for the price to fall a bit more?

IveSeenTheLight

kad1 wrote: »

Hi all. I'm hoping to benefit from your fountain of wisdom...

I've been in my flat now for nearly 3 years on a shared ownership basis. When I bought in 07 the flat (new build, 2-d/bed rooms in a 2-story block, kitchen furnished) was £182,500. I bought a 70% share (£127,750) and taking into account the deposit I put down, was given a mortage of £107,750.

I put my flat details through Zoopla and was given the estimated value of £169,109 with a range of £152,199 - £186,019. I am now considering buying the remaining 30% but would like your advice as to whether now is a good time to do so? Should I wait a little longer for the price to fall a bit more?

Zoopla can be hugely erratic and I personally know they are well out with their estimations.
They have one of my rented properties as receiving 1/2 the rent it actually does.

I would definately recommend getting a more professional evaluation of your property that that of Zoopla.

Where is your location?
Have you checked it against the land registry?

kad1

Land registry doesn't shed any light unfortunately as when I do a search it says:

'Sorry, there is no price paid/value stated information available for this property'

I am based in Enfield.

Alex_Richards

I think house prices will fall or remain static over the next 2-3 years or so then start rising sharply again, simply because there demand will outstrip supply with a rising population. Of course, if the economy is !!!!!!ed the housing market will remain stagnant for many, many years. And yet people will continue to invest, based on the previous boom.

IveSeenTheLight

kad1 wrote: »

Land registry doesn't shed any light unfortunately as when I do a search it says:

'Sorry, there is no price paid/value stated information available for this property'

I am based in Enfield.

I found info for Enfield
Depending when you bought in 2007 you could still be showing a positive price or a slightly negative price.
The index was 304.8 in Jan 07 and 337.0 in Dec 07
Currently the index is 311.3

kad1

this info is v interesting thank you! i bought in Nov 07 so i guess i'm looking at negative equity at the mo?

IveSeenTheLight

kad1 wrote: »

this info is v interesting thank you! i bought in Nov 07 so i guess i'm looking at negative equity at the mo?

On average for the area, flats were £215,132 in Nov 07.
Latest info on average shows them as £199,274.
This represents a rough drop as 7.37% from the time you bought.

You purchsed at £182,500 so in theory (roughly) you could estimate that the value would be around £169,047 (representing a 7.37% drop.

Your share of the property was 70%, so your proportion of £127,750 becomes valued at £118,333 (if thats how shared ownership works).

Given the deposit you put down, you would not be in negative equity, although if you sold you would net receive the same deposit back

In essence (in line with your original post), instead of requiring an additional £54,750 to purchase the additional 30%, you would currently only need £50,714. (If that's how shared ownership works).

It would appear that the drop in value helps those in shared ownership to be able to affeor the remaining part of their property.

You need to wonder if there are likely further drops ahead or not.
Certainly from the graphs I've shown it seems the last two months turned negative, however there was a substantial recovery from the trough (approx 10% difference)

Hope all this helps you to make an informed decision

kad1

Oh decisions decisions! You have certainly given me food for thought, thank you. I guess it's all in judging when the market will go on an sustained upward turn and you how can anyone confiently predict that? what would you recommend as the best way to monitor the market?

i am planning to get a professional valuation done in Dec so I beat the VAT rise and then I have 3 months from then to acquire the remaining shares before I'd be required to get another valuation.