Should we pull out? Buying our first place and Corona Virus concerns

Thrugelmir

Transaction volumes will be affected by the 3 D's. Death , Distress (Financial) and Divorce (Relationship Breakdown)  doesn't take a crystal ball to see that the current crisis weighs heavily to the negative. Also that rammifications will be felt by many for a very long time. 
When buying remember that you take on all maintenance issues. Boilers, double glazing, etc. Over time the costs do mount up. While ownership is obviously better in the long term. Don't overlook the short/medium term demands on your cash. 

Jonny363737

Thank you all for your opinions! I haven't taken any offence and am aware there is no crystal ball to see into the future! Educated options and facts are helping me and my partner make an educated decision.

At the moment were leaning toward trying to get some money off and proceeding. The question is just how much. It seems cheeky to ask for more than 5k but perhaps appropriate. 

Another factor some have mentioned to me is that borrowing rates will be effected when the market does recover. I'm currently getting a pretty good deal which is leaning me (along with the 825 dead money in rent a month) toward continuing and a reduced rate. 

Thrugelmir

Jonny363737 said:

Another factor some have mentioned to me is that borrowing rates will be effected when the market does recover. 

Currently it's cheap to borrow. If the scenario were to arise that house prices were to fall and interest rates rise. It's possible that you'd still be better off financially in the long term by buying now. Run some numbers through a mortgage calculator. What If scenarios are total guess work but at least you will be informed when making your decision. 

Jonny363737

After bargaining with the estate agents/ homeowners today we have agreed on a £4000 reduction on the purchase price. We initially tried for more but that was the maximum we could get.

We've now been asked by the owners to get things through ASAP and asked to not renegotiate again  (we wasn't planning on pushing our luck anymore lol) 

Thank you again for all your opinions. I'd urge anyone in a smiliar position but wanting to proceed to have a chat with the agent (without scaring them off) to see if you can get some money off.

I think with the reduction, the good mortgatge deal and the fact that we will be paying off our mortgage rather than rent during the upcoming uncertain time I now feel more comfortable proceeding. Thanks again folks. Hopefully it will turn out to be the right decision. 

Crashy_Time

JessJ23425 said:

Densol said:

Ive pulled out on my purchase 

Just going to add a little more info from this chap - he's pulled out of his BTL INVESTMENT purchase!! Very different situation obviously.

If it's somewhere you plan to stay for years to come and importantly you are not expecting a change in your circumstances employment wise, "go for it" has been the main advice on the forum.

The first two things are not predictable for many years in the future, especially nowadays, the key thing is to purchase the house as cheaply as possible, so waiting may be the way to go in these circumstances.One problem with the general property advice on here is that many of the people giving the advice have large mortgage debt themselves or are wedded to the idea that property will always go up in price and pay out when needed, very dangerous assumptions to make IMO.

Crashy_Time

MovingForwards said:

JessJ23425 said:

Densol said:

Ive pulled out on my purchase 

Just going to add a little more info from this chap - he's pulled out of his BTL INVESTMENT purchase!! Very different situation obviously.

If it's somewhere you plan to stay for years to come and importantly you are not expecting a change in your circumstances employment wise, "go for it" has been the main advice on the forum.

Not as dramatic for him/her to say it was a BTL though was it, as it gives perspective and not the panic s/he is trying to spread!

Don`t take this the wrong way, but when the US is passing a bailout deal of nearly $2 trillion dollars, the panic has already spread! I wish people here would get out of the mindset of it just being a few "Doomsters" trying to crash the property market by invading forums and try to embrace economic reality a bit more, it would give, especially the property forums, a lot more credibility.

SouthLondonUser

I am surprised there aren't more comments mentioning:

• financial situation and liquid savings: is your job really very safe? Will you have substantial savings even after buying? Unless I could answer yes to both, I wouldn't buy now - I'd much rather keep the money put aside for a deposit as a buffer for a rainy day.
• when will the new house be ready to move in? Do you need to refurbish? Good luck with that. Do you need a removal company? Good luck with that, too. Even if you found one, do you want a team of strangers moving dusty dirty boxes and appliances right now? I know I wouldn't.
• if you can't move for a while, have you factored in that you risk paying rent + mortgage for quite a few months?
• yes, it is true that the principal you repay as part of your mortgage payment is money you repay to yourself, so not a cost. However, that is also money you cannot easily get out of the house once you put it in. I.e. if you were to struggle financially, it would be much better to have, say, £10k more in the bank and £10k less of equity in the house, because the £10k in the bank you can use to pay for food and bills.

jstw

I would personally be holding off for another 6 months. Barclays have pulled their mortgages with more than 60% LTV, I’m sure a bank knows better what’s going on and if they don’t want to take the risk of highly leveraged loans, I definitely wouldn’t be. 

Thrugelmir

jstw said:

I would personally be holding off for another 6 months. Barclays have pulled their mortgages with more than 60% LTV, I’m sure a bank knows better what’s going on and if they don’t want to take the risk of highly leveraged loans, I definitely wouldn’t be. 

Barclays off shore India call centre / processing operation has been impacted by the entire lock down in the country. 

Jonny363737

We're in quite a fortunate position that 1, we don't need removal companies as I own a van. 
2, we are planning on some renovations but we do not need to do imediattley.
3, I have job security 
4, We just got out mortgage offer through, still at a good rate
45 we have some finances set aside for renovations which we could potentially full back on if needed. 
Another factor which I have not mentioned is about the supply of property in my area. There was really very little around our range and a lot of buyers in a similar position to us. We got shafted on two houses where there was so much interest we didn't even make it through the front door.  This place ticks all of our boxes and we consider ourselves quite fortunate to have got it. This is a situation that is going to be much worse once the market has recovered.