Who are buying now?

otter1_2

I'm looking to buy now. Me and the OH have reached a point where our 1-bedroom flat is feeling rather small and we decided that we didn't want to move to another rental property when we might as well buy. If we don't find somewhere immediately it's not the end of the world, but it would be great if we found somewhere sometime soon. Couldn't give a stuff about negative equity - we'll be there for the next ten years so we can ride it out.

PasturesNew

kissingthepink wrote: »

I do not have a stop loss in place as I believe that over a 10 year period the property will gain in value overall, i.e. if there is a price slump say next year, that prices would have caught up by year 5 or 6.

I think the "argument" here is: if there is a crash, you'd better off selling, banking the money for 5-6 years risk/hassle free. Then buying an identical property at the lower prices in X years and starting again. Especially if the crash lasts 5 years on the way down and 5 years on the way up again.

That's where bears are coming from.

So I guess your bet is placed on a short fall/rise timescale.

Would you feel the same if it were going down for 5 years, then up for 5? So a property wouldn't be the same value for another 10 years?

hearts

Ive bought 4 more in the last 3 months. ;-)

Zammo

Without massive job lay offs and people being forced to sell there will be no crash - there may however be a slight correction if the banks are unwilling to lend as much, which in my experience so far doesn't seem to be the case.

I wouldn't touch a new build flat with a barge pole though, there is a massive oversupply of the things and when there is a correction they will be hit the hardest.

TBeckett100

suddenly my offer on a house 10k below asking has gone from flat refusal to constant calls from estate agent.

epz_2

i probably will but thats cause i really need to move to lanarkshire for work(1), fortunatly houses are buttons and assuming it takes 4 years for the market to bottom out based on local rents prices would have to have droped over 22% for me to make a saving.

frankly with the big deposit i have and a pretty damn secure job in an industry with very transferable skills it really doesnt matter what happens, i just dont want to keep blowing £20 a day on petrol.


(1) thanks mostly to seemingly constant inability of drivers to not crach into each other on the motorway, 2 1/2 hours to get home some days !!!!!!, its only 40 miles.

Chilibean_2

I'm selling mine and upgrading to a better area, but only because of issues with my neighbours and what has happened in the last few weeks. The one I'm going for is approx 17,000 below market value as it's a builders part ex, and it's in a very good area and in the catchment for a better school. Properties hardly ever come up for sale there so when I saw it, I had to jump in while I had the chance.
There are 2 properties for sale on my road already, so I have some competition but saying that neither are as nice as mine. I am keeping my fingers crossed that someone falls in love with mine and I can move quickly, if not I will stay put and hope I can ride the storm.

jyonda

My uncle has just downsized from 4 bed (640k) to 3 (320k). The woman who bought his house was downsizing from a £1.3 million property.

IveSeenTheLight

PasturesNew wrote: »

I think the "argument" here is: if there is a crash, you'd better off selling, banking the money for 5-6 years risk/hassle free. Then buying an identical property at the lower prices in X years and starting again. Especially if the crash lasts 5 years on the way down and 5 years on the way up again.

That's where bears are coming from.

So I guess your bet is placed on a short fall/rise timescale.

Would you feel the same if it were going down for 5 years, then up for 5? So a property wouldn't be the same value for another 10 years?

Seems to me that you are speculating how long and how low prices will drop by.
This is okay, but by speculating you risk losing money as well/

Lets speculate that house prices drop 20% over 5 years before starting to climb again. A 200,000 pound house is now worth 160,000.

However you would have to pay rent on that property for 5 years (not including any costs if you have to move during this time). Lets say the rent is 1,000 per month, this means you spend 12,000 per year and 60,000 on rent, (without including any rent increases) over five years.

So a very short speculation would result in you spending 60,000 to save 40,000 and have not reduced the amortization period during that time.

Sure this is very basic and does not include and interests etc, but just pointing out that speculating on house price drops can mean you pay more in the long term depending on by how much prices drop by and for how long.

Of course, when the cycle is at the bottom, you are going to see a massive swing in buyers who are trying to get ono to the ladder, back on to the ladder or by investors

Hope it works out for you though

sarkin

hearts wrote: »

Ive bought 4 more in the last 3 months. ;-)

http://news.bbc.co.uk/1/hi/business/7083446.stm

You must be either rich or stupid