Advice on reducing asking price

MobileSaver

lookstraightahead said:

MobileSaver said:

lookstraightahead said:

MobileSaver said:

lookstraightahead said:

MobileSaver said:

lookstraightahead said:

I think the worst situation to be in would be paying over valuation now , with interest rates as they are. Or even near to current valuation as this is going down (in my opinion).

As you said recently, we see life differently. You and others seem to view their home as just a pile of bricks, in my world most people see their home as more than that.

What I don't want is my "dream home" becoming an absolute nightmare.

If, like most people, you buy a home with a five-year or longer fixed rate mortgage then how does that become an "absolute nightmare"? What specifically are you afraid of?

I'm not afraid, just sensible. I feel you are more afraid

Er, ok, so if you are not afraid of anything then how can buying your home with a five-year fixed rate mortgage become an absolute nightmare? I genuinely don't understand what you mean.

You're twisting my words.

Your actual words were "What I don't want is my 'dream home' ... becoming an absolute nightmare." You then continued with "A property that is an absolute nightmare is much worse than missing out on a dream home."

I've simply asked how does someone's home become an "absolute nightmare" and for whatever reason you seem reluctant or unable to answer.

Seriously. It becomes a nightmare if you've paid too much and you're in negative equity if you need to sell (and debt). And that is an extremely difficult position to get out of (as I have experienced).

You really don't need to agree

I agree, negative equity could be a nightmare but the chances of that happening are incredibly slim.

As you know a third of all purchases are cash so negative equity is obviously impossible in those cases.

For the remaining two thirds, most homes are bought with at least a five-year fixed rate mortgage and at least a 15% deposit with the average deposit being something like 23%. That means most homeowners have at least 15% equity on day one, fixed outgoings for at least 5 years and month in, month out, for five years they're reducing the amount they owe. Yes, it's not impossible that some could be in negative equity after five years but it's highly unlikely. Of course, even if someone is in negative equity, it's a nightmare but it's not the end of the world.

I do disagree with what I think you're suggesting which is "don't buy a dream house because you might end up in negative equity". While technically you are correct, statistically it's very unlikely. You may as well say don't have a relationship with anyone because it may end badly or don't cross the road as you may get knocked over... Life is for living and you can't be scared of doing anything just because things may go wrong, that's not living.

lookstraightahead

 Life is for living and you can't be scared of doing anything just because things may go wrong, that's not living

But you do learn from your mistakes and naivety, as I have,  and if you can live your life and also minimise your risk, that's a game changer. I can't ever imagine needing a specific house so much that I would equate it to "living my life". To me that's just materialistic and it won't bring true happiness. 

Life is for living, agreed, you don't have to throw caution to the wind though. A bit like the relationship point you made. I'm not saying don't have a relationship with anyone, I'm saying think before you act. I'm not saying don't cross the road, I'm saying why cross with your eyes shut when you can just open them.

Sarah1Mitty2

MobileSaver said:

Sarah1Mitty2 said:

Aberdeenangarse said:

MobileSaver said:

Sarah1Mitty2 said:

JJR45 said:

MobileSaver 

Most of the rest will have taken out a five-year or longer fixed rate so they won't be worrying about renewing for at least another three years yet...

it is around 50% of new lending that was on 5y+ fixed in 2020, but that could still mean the majority of a mortgage on a property in terms of value could be on a different term.

Around 70% of mortgage debt payers will see their monthly debt costs rise in the next couple of years apparently.

Around 100% of renters will see their monthly rent costs rise in the next couple of years apparently.

Yes, particularly with all those  over leveraged Landlords trying to offload their ‘investments’

 https://www.telegraph.co.uk/property/uk/buy-to-let-crisis-trigger-property-fire-sale-landlords-suffer/

Who will buy the "loss making properties"?

People who want the property as a home rather than a business perhaps?

But those people have seen their borrowing power decimated, and the mortgage rate hikes have only just started, how much discount do you think they will need to be able to buy these properties, and unless you think they are all living at home then what happens to their present landlord?

Sarah1Mitty2

RelievedSheff said:

lookstraightahead said:

MobileSaver said:

lookstraightahead said:

MobileSaver said:

lookstraightahead said:

MobileSaver said:

lookstraightahead said:

I think the worst situation to be in would be paying over valuation now , with interest rates as they are. Or even near to current valuation as this is going down (in my opinion).

As you said recently, we see life differently. You and others seem to view their home as just a pile of bricks, in my world most people see their home as more than that.

What I don't want is my "dream home" becoming an absolute nightmare.

If, like most people, you buy a home with a five-year or longer fixed rate mortgage then how does that become an "absolute nightmare"? What specifically are you afraid of?

I'm not afraid, just sensible. I feel you are more afraid

Er, ok, so if you are not afraid of anything then how can buying your home with a five-year fixed rate mortgage become an absolute nightmare? I genuinely don't understand what you mean.

You're twisting my words.

Your actual words were "What I don't want is my 'dream home' ... becoming an absolute nightmare." You then continued with "A property that is an absolute nightmare is much worse than missing out on a dream home."

I've simply asked how does someone's home become an "absolute nightmare" and for whatever reason you seem reluctant or unable to answer.

Seriously. It becomes a nightmare if you've paid too much and you're in negative equity if you need to sell (and debt). And that is an extremely difficult position to get out of (as I have experienced).

You really don't need to agree, but you don't need to waste your valuable time and energy on me as I will not change my opinion.
have a lovely day (and I mean it 😊)

Negative equity isn't the end of the world. We were in it for a long time after we bought our previous house in 2007.

We survived. We still had somewhere to live. That house was still our home. It's value was irrelevant.

Negative equity is easily avoided now though, you just don`t buy a house at bubble prices when interest rates have started to rise.

newsgroupmonkey_

Sarah1Mitty2 said:

RelievedSheff said:

lookstraightahead said:

MobileSaver said:

lookstraightahead said:

MobileSaver said:

lookstraightahead said:

MobileSaver said:

lookstraightahead said:

I think the worst situation to be in would be paying over valuation now , with interest rates as they are. Or even near to current valuation as this is going down (in my opinion).

As you said recently, we see life differently. You and others seem to view their home as just a pile of bricks, in my world most people see their home as more than that.

What I don't want is my "dream home" becoming an absolute nightmare.

If, like most people, you buy a home with a five-year or longer fixed rate mortgage then how does that become an "absolute nightmare"? What specifically are you afraid of?

I'm not afraid, just sensible. I feel you are more afraid

Er, ok, so if you are not afraid of anything then how can buying your home with a five-year fixed rate mortgage become an absolute nightmare? I genuinely don't understand what you mean.

You're twisting my words.

Your actual words were "What I don't want is my 'dream home' ... becoming an absolute nightmare." You then continued with "A property that is an absolute nightmare is much worse than missing out on a dream home."

I've simply asked how does someone's home become an "absolute nightmare" and for whatever reason you seem reluctant or unable to answer.

Seriously. It becomes a nightmare if you've paid too much and you're in negative equity if you need to sell (and debt). And that is an extremely difficult position to get out of (as I have experienced).

You really don't need to agree, but you don't need to waste your valuable time and energy on me as I will not change my opinion.
have a lovely day (and I mean it 😊)

Negative equity isn't the end of the world. We were in it for a long time after we bought our previous house in 2007.

We survived. We still had somewhere to live. That house was still our home. It's value was irrelevant.

Negative equity is easily avoided now though, you just don`t buy a house at bubble prices when interest rates have started to rise.

Surely that is dependent on whether you are buying and selling?

I mean, if you're renting then perhaps.

Ultimately, the only people that lose out during negative equity are those who sell to rent or get out of the housing market.

mi-key

@Sarah1Mitty2 "have seen their borrowing power decimated" ? Have you actually worked out the costs ? 

On £100K borrowing, before you could get a fix at 2%, that would be £424 per month.You can now get a fix at 4.5% which is £556. An extra £130 a month is hardly having your borrowing power decimated when the average uk salary is £3166 per month ?

Remember an awful lot of people aren't first time buyers having to borrow £200K, they are people moving from an existing home with equity in it, so often aren't borrowing that much to upsize

mi-key

"Negative equity is easily avoided now though, you just don`t buy a house at bubble prices when interest rates have started to rise"

No, you buy a house when you can afford the monthly repayments, are offered a mortgage and find a house you want to live in.

Until mortgages become more expensive than renting, people will always keep buying

JJR45

mi-key said:

Until mortgages become more expensive than renting, people will always keep buying

I Believe mortgages are a fair bit more than renting now.

mi-key

JJR45 said:

mi-key said:

Until mortgages become more expensive than renting, people will always keep buying

I Believe mortgages are a fair bit more than renting now.

Not for equivalent properties in lots of areas. My house would cost me £1100 a month to rent, I pay £629 mortgage. Even if I swapped to a 4.5% deal this would only go up to £732.

Sarah1Mitty2

mi-key said:

@Sarah1Mitty2 "have seen their borrowing power decimated" ? Have you actually worked out the costs ? 

On £100K borrowing, before you could get a fix at 2%, that would be £424 per month.You can now get a fix at 4.5% which is £556. An extra £130 a month is hardly having your borrowing power decimated when the average uk salary is £3166 per month ?

Remember an awful lot of people aren't first time buyers having to borrow £200K, they are people moving from an existing home with equity in it, so often aren't borrowing that much to upsize

As I said, search "Buyer enquiries" and look at what is happening in the real world.