Is a recession a good time to buy?

Mickey666

Marvel1 said:

Bought before it started late 2007, never recoverd, but I have a roof over my head and mortgage is much cheaper than rent for someone elses mortgage.

THAT is the key issue - having somewhere to live.  That's going to cost either rental payments or mortgage payments.  I know which I'd rather pay . . . er, except I don't have to pay either because I've paid off my mortgage

Mickey666

Crashy_Time said:

RelievedSheff said:

There is no right or wrong time to buy a property if it is going to be a long term home.

The tail end of the biggest bubble in history and the start of a major recession is the wrong time, whatever kind of home it is going to be.

So what's your alternative?  Rent somewhere to live instead (and probably pay someone else's mortgage)?

I took out my first mortgage mortgage back in the early 80s recession, another in the late 80s and then another in the early 90s recession.  Fortunately I paid it off early so by the 2008 recession I cared even less about recessions and was able to retire early.    To rent the house I now own would probably be around £3k/month yet I've never paid more than £640/month for any of my mortgages, even when they were at 15% interest.

Glad I didn't wait to buy and waste money on renting instead

Aaghh321

Couldn't agree more. When I move into my new place I'll be saving £00's a month in mortgage over rent costs and have a nice garden to spend any future lockdowns in. Even if I lose my job my emergency savings will last about 50% longer.

Crashy_Time

Mickey666 said:

Crashy_Time said:

RelievedSheff said:

There is no right or wrong time to buy a property if it is going to be a long term home.

The tail end of the biggest bubble in history and the start of a major recession is the wrong time, whatever kind of home it is going to be.

So what's your alternative?  Rent somewhere to live instead (and probably pay someone else's mortgage)?

I took out my first mortgage mortgage back in the early 80s recession, another in the late 80s and then another in the early 90s recession.  Fortunately I paid it off early so by the 2008 recession I cared even less about recessions and was able to retire early.    To rent the house I now own would probably be around £3k/month yet I've never paid more than £640/month for any of my mortgages, even when they were at 15% interest.

Glad I didn't wait to buy and waste money on renting instead

Can you post a link to something similar that rents for 3k a month?

Mickey666

Crashy_Time said:

Mickey666 said:

Crashy_Time said:

RelievedSheff said:

There is no right or wrong time to buy a property if it is going to be a long term home.

The tail end of the biggest bubble in history and the start of a major recession is the wrong time, whatever kind of home it is going to be.

So what's your alternative?  Rent somewhere to live instead (and probably pay someone else's mortgage)?

I took out my first mortgage mortgage back in the early 80s recession, another in the late 80s and then another in the early 90s recession.  Fortunately I paid it off early so by the 2008 recession I cared even less about recessions and was able to retire early.    To rent the house I now own would probably be around £3k/month yet I've never paid more than £640/month for any of my mortgages, even when they were at 15% interest.

Glad I didn't wait to buy and waste money on renting instead

Can you post a link to something similar that rents for 3k a month?

 Just search for properties with 8 bedrooms in about 5 acres.

steve866

I don’t think there is any general ‘good time to buy’ whether we are in a boom or recession. A recession *could* well be a good time to buy if you managed to time the market and buy at a discount. From your original post, if your job is secure I wouldn’t hold back from proceeding given that you love the property and you think you’ll be able to get a good discount on it. 

Mickey666

steve866 said:

I don’t think there is any general ‘good time to buy’ whether we are in a boom or recession. A recession *could* well be a good time to buy if you managed to time the market and buy at a discount. From your original post, if your job is secure I wouldn’t hold back from proceeding given that you love the property and you think you’ll be able to get a good discount on it. 

I'd go further and say that ANYTIME is a good time to buy.  You need somewhere to live and the only other option is to waste money renting.  Buying decisions need to be considered over 25-30 years not the next six months.  Over 25-30 years buying is a no-brainer, and that's even without considering the retirement planning advantages of having 'free' housing when the mortgage is paid off.

Scotbot

Crashy_Time said:

Scotbot said:

Crashy_Time said:

Anamox said:

Crashy_Time said:

RelievedSheff said:

There is no right or wrong time to buy a property if it is going to be a long term home.

The tail end of the biggest bubble in history and the start of a major recession is the wrong time, whatever kind of home it is going to be.

Extrapolating data from your comment history it looks like you've been predicting this bubble bursting imminently for more than half a decade... considering we're still 4 million houses short and mortgages are now stress tested to the extremes (thus most of us can now afford the houses we buy) it seems unlikely anything will be happening anytime soon. Even when you factor in COVID-19 job losses, they are predominantly in industries in which the workers likely don't own a house and aren't likely to have ever been prospective buyers nor are about to default on a mortgage. The higher level redundancies we're seeing are with people that are most likely qualified enough to move into another role elsewhere.

Why are transactions at half peak level (ignoring the Covid phase of near zero) in that case? 

Because of the cost of moving prior to the SDLT holiday. You can build an extension for the same cost in many areas. You can't get a builder round here for love nor money they are booked up 6 months in advance. For the same reason FTBs are no longer buying small flats  then trading up a couple of years later instead  they wait a bit longer then buy the 3 bed house

So you really seriously believe that falling transactions prior to Covid had nothing to do with the actual price of the house?

Volume of transactions is directly related to number of properties on the market. If it ain't for sale you can't buy it. The SDLT changes resulted in fewer properties being marketed as people decided to renovate instead of moving.

Crashy_Time

Scotbot said:

Crashy_Time said:

Scotbot said:

Crashy_Time said:

Anamox said:

Crashy_Time said:

RelievedSheff said:

There is no right or wrong time to buy a property if it is going to be a long term home.

The tail end of the biggest bubble in history and the start of a major recession is the wrong time, whatever kind of home it is going to be.

Extrapolating data from your comment history it looks like you've been predicting this bubble bursting imminently for more than half a decade... considering we're still 4 million houses short and mortgages are now stress tested to the extremes (thus most of us can now afford the houses we buy) it seems unlikely anything will be happening anytime soon. Even when you factor in COVID-19 job losses, they are predominantly in industries in which the workers likely don't own a house and aren't likely to have ever been prospective buyers nor are about to default on a mortgage. The higher level redundancies we're seeing are with people that are most likely qualified enough to move into another role elsewhere.

Why are transactions at half peak level (ignoring the Covid phase of near zero) in that case? 

Because of the cost of moving prior to the SDLT holiday. You can build an extension for the same cost in many areas. You can't get a builder round here for love nor money they are booked up 6 months in advance. For the same reason FTBs are no longer buying small flats  then trading up a couple of years later instead  they wait a bit longer then buy the 3 bed house

So you really seriously believe that falling transactions prior to Covid had nothing to do with the actual price of the house?

Volume of transactions is directly related to number of properties on the market. If it ain't for sale you can't buy it. The SDLT changes resulted in fewer properties being marketed as people decided to renovate instead of moving.

Volume of transactions is directly related to availability of credit and demand, if there is low demand it doesn`t matter how many properties are on the market.

Crashy_Time

Mickey666 said:

steve866 said:

I don’t think there is any general ‘good time to buy’ whether we are in a boom or recession. A recession *could* well be a good time to buy if you managed to time the market and buy at a discount. From your original post, if your job is secure I wouldn’t hold back from proceeding given that you love the property and you think you’ll be able to get a good discount on it. 

I'd go further and say that ANYTIME is a good time to buy.  You need somewhere to live and the only other option is to waste money renting.  Buying decisions need to be considered over 25-30 years not the next six months.  Over 25-30 years buying is a no-brainer, and that's even without considering the retirement planning advantages of having 'free' housing when the mortgage is paid off.

Most people, especially later buyers, don`t get the chance to buy a 30 year house during a housing bubble though, that is one problem with Ponzi schemes, sorry housing bubbles, and anecdotal from the 80`s has very little relevance to today`s bubble, sorry market.