Is now a really bad time to buy a house?

ProDave

If buying your first home (so you don't have one to sell) I would much rather buy in a slow market where you can take more time to find what is right and not be bullied into over bidding to "win" it.

A first home is rarely a "forever home" it is usually a starting place, to later step up to a better property that more fits your idea of forever home.

Hedgepigs

RelievedSheff said:

We bought our last house in 2007, right before house prices took a turn. We were in negative equity with that property for a long time but it wasn't really a problem. We continued to pay the mortgage and eventually a combination of slowly rising house prices and the building of equity meant that we could move onto our current home in 2019.

Looking back, 2007 was still the right time to buy for us. We were in the position to buy our own home instead of paying rent. Rent would have been more expensive than our mortgage. The big lesson learned for us was to take our mortgage over as short a term as possible to pay less interest. We paid far too much interest on the previous  house due to the long 30 year term we took out and not being able to remortgage due to negative equity.

I would caveat the 'shortest mortgage term possible ' with taking into consideration allowed overpayments. 

I took a longer term, but am overpaying to the amount of the shorter term mortgage, so the debt is going down as if I were on a shorter term and without penalty, but with the safety net I can reduce my payments to the actual contracted amount should I ever need to. 

t1redmonkey

Probably depends a bit on if you're a cash buyer or not (you haven't mentioned that in your opening post). 

If you're getting a mortgage then I don't think it's going to make that much difference if you buy now or wait a bit, since waiting might result in lower house prices but then it's also going to mean higher mortgage rates (plus whatever you're paying for renting in the meantime). 

So you'd basically be relying on a massive house price crash to offset that, which I doubt is going to happen.  But who knows.

london21

RelievedSheff said:

We bought our last house in 2007, right before house prices took a turn. We were in negative equity with that property for a long time but it wasn't really a problem. We continued to pay the mortgage and eventually a combination of slowly rising house prices and the building of equity meant that we could move onto our current home in 2019.

Looking back, 2007 was still the right time to buy for us. We were in the position to buy our own home instead of paying rent. Rent would have been more expensive than our mortgage. The big lesson learned for us was to take our mortgage over as short a term as possible to pay less interest. We paid far too much interest on the previous  house due to the long 30 year term we took out and not being able to remortgage due to negative equity.

Another way around this is to overpay if you can, most lenders allow a yearly overpayment of 10%.

fewcloudy

pinkshoes said:

jennim said:

My husband and I are looking to buy our first home. We have been looking for just over a year but have had awful luck with the market being the way it is, been gazumped, ourselves pulled out because of survey etc. Anyway, now we are still looking but doubts starting to creep in with the house market possibly going to crash and possibly prices fall, is it a really bad idea to buy now? Especially considering the house we buy is highly unlikely to be our forever home, so resell value in 5ish years is relevent. 
Any helpful advice much appreciated 🙏

Why won't it be your forever home?

I can't speak for the OP, but in my experience, very few FTB are buying their forever home.  I'm not sure if the answer is important anyway, is it?

I think the answer is to buy now OP. And when you look back in hindsight wou will be either pleased you did, or be a bit miffed.  And a few years after that you will only be pleased that you did it now.
Very few people will look back 5yrs and wish they hadn't bought.

Getting_greyer

So many variables in play. In two years time you might have increased equity by £20k and see it wiped out in 3rd year. So maybe not catastrophic. 

Practical advice would be not to get into a bidding war, try and have an emergency fund and maybe look at something that could work over the medium term if you would be unable to sell and move. Eg if you're planning extra kids in 2 years maybe look at a shabbier 3 bed house instead of chic one bed flat.

EndlessStruggle

I would keep trying to buy.

I assume you're renting so it's either 100% equity loss vs an unknown % chance of unknown % of equity loss.

I bought my first house in Dec 2021 (planning to stay for 3-5 years) but my circumstances have changed and I've just sold it for 32k more than I bought it for.

I've had an offer accepted on another house for 8k less than asking price. 

I walk away with 17-20k in my pocket.

Someone else might have lost 17-20k. 

No regrets buying this house even though it's not my forever home.

CRISPIANNE3

We are in the process of buying another house. We view this as our next home. Happy with the price we paid and everything else. I leave others to play the property game.

[Deleted User]

Bought house 6 years ago 75% increase in value.
Bought house 2 years ago 20% 
Increase.
Thing is I just wasnt smart enough to wait for the crash.

My view. Buy the right property, in the right place. And its your home. It will probably hold value and might well increase.  But failing that - be happy to live in it!

lookstraightahead

When you buy a property you shouldn't see it as a money tree. The market will always go up and down. You can't just own property and only see it increase in value. 

I would continue to buy - but be realistic about what you're paying and don't get misguided by sellers who only see their house as a money tree. 

Take into account that lenders are wary about house values.