Will there really be a crash?

Sapphire

People (even wealthy ones) used to rent much more than they do now, and still do in other countries. In no way were they considered failures, at least not based on whether they rented or owned properties.

However, the system has become skewed in this country, due to property now being considered a 'market', which should never have been allowed to happen; homes should be places to live in, not to speculate on.

Advertising has plastered itself in gullible people's imaginations, giving them the impression that they are somehow better people if they own a property, which is nonsense. Someone above is even of the impression that you become 'upper middle class' when you own a property, which is also patent nonsense.

lookstraightahead

I'm still not sure why owners think they are more successful than renters. I'm bemused by the amount of homeowners who take out massive loans for stupid cars. There's a new estate by us full of tiny four bed houses and sitting in the drive are brand new shiny 4x4s, presumably on the never never, Debt debt and more debt. Makes the money saved on buying a house pale into insignificance.

Computer_Beginner

Sapphire wrote: »

People (even wealthy ones) used to rent much more than they do now, and still do in other countries. In no way were they considered failures, at least not based on whether they rented or owned properties.

However, the system has become skewed in this country, due to property now being considered a 'market', which should never have been allowed to happen; homes should be places to live in, not to speculate on.

Advertising has plastered itself in gullible people's imaginations, giving them the impression that they are somehow better people if they own a property, which is nonsense. Someone above is even of the impression that you become 'upper middle class' when you own a property, which is also patent nonsense.

Property may be a market, but it's certainly not a free market.
It's completely manipulated by the govt, via the planning system.

You don't own a property you have a mortgage on.

Computer_Beginner

lookstraightahead wrote: »

I'm still not sure why owners think they are more successful than renters. I'm bemused by the amount of homeowners who take out massive loans for stupid cars. There's a new estate by us full of tiny four bed houses and sitting in the drive are brand new shiny 4x4s, presumably on the never never, Debt debt and more debt. Makes the money saved on buying a house pale into insignificance.

I've met two types of debtors in my life.
1. Those who blindly get into debt and end up worse off to the creditors.
2. Those who deliberately take on debt, in order to lower the value of the assets available to any creditors trying to sue them etc. Basically a method of risk management. They have assets out of reach.

One guy told me "the only good debt to hold, is one that you default on".

If you owe the bank £1000 that's your problem.
If you owe the bank £1 million, that's their problem.

lookstraightahead

triathlon wrote: »

There are the Triathlons(I do them for real by the way)HPC !!!!!s and Chucknorris of this world who clunk glasses with the elite and hold our heads up high, and then you get the bitter and twisted who blame the world. Ask yourself and be honest, who do you want to be like, them or us?

It really is a no brainer

I don't understand your question to be honest. Are you asking who would like to be you? "Hands up who wants to be me?" type scenario? Who are the elite?

chucknorris

Computer_Beginner wrote: »

Property may be a market, but it's certainly not a free market.
It's completely manipulated by the govt, via the planning system.

You don't own a property you have a mortgage on.

You do own property that is mortgaged, that is a legal fact, currently we own 4 houses with no mortgage, and 3 flats and 1 house with mortgages, but we do own all 8 properties. We could pay of all those 4 mortgages, but as the mortgage rate is less than dividend income from our shares, that would be very foolish.

GDB2222

I'm a bit horrified at the assumption that house prices are bound to rise. There are reasons why prices have risen: the two main ones are shortage of supply and very low interest rates. If Brexit really does reduce immigration and we really do build more houses, the supply shortage may ease. Interest rates may rise if the £ falls following Brexit. I'm not predicting a crash, but I'd be cautious about over-extending financially.

I've lived through the price crash which lasted around 7 years, starting around 1988. It was pretty awful for some, and I bet they remember what happened, but everybody else seems to have forgotten about it.

Sapphire

Computer_Beginner wrote: »

You don't own a property you have a mortgage on.

You do own it if you've paid off your mortgage, to your great satisfaction after many years of hard work and penny pinching.

lookstraightahead

chucknorris wrote: »

You do own property that is mortgaged, that is a legal fact, currently we own 4 houses with no mortgage, and 3 flats and 1 house with mortgages, but we do own all 8 properties. We could pay of all those 4 mortgages, but as the mortgage rate is less than dividend income from our shares, that would be very foolish.

Ok debtor is a better word maybe.

chucknorris

lookstraightahead wrote: »

Ok debtor is a better word maybe.

Bears like you never seem to realise that having some debt is not necessarily a bad thing, in fact, it can be a beneficial. For example we are approaching 10 years of low interest rates. For those 10 years, if I had wanted to, I could have paid off my mortgages, for which the rate is marginally over 1%. But the return on my equities (for which the total investment far exceeds the value of my mortgages) dividend income over that period, exceeds 3.5% (currently around 4%). Therefore it really is a 'no brainer' to retain the debt.

That might change however, when I sell one or two of my properties in the near future, because IMO it wouldn't be so wise to invest more into the stock market at my age (60). I will invest the equity into safer assets, probably single corporate bonds held to maturity.