Should I Buy a House?

Jonbvn

brit1234 wrote: »

I would give it 6 months, the market is falling far faster than anyone predicted. That way the difference in properties will be smaller saving you £1000s.

I don't think houses will fall as much or as fast as flats. Considering that they are selling a flat, the situation is surely not so clear cut?

ixwood

I guess the ideal solution is selling to rent/lodge/share.

Now is the best (or least worst) time in probably the next 5-10 years to sell a flat IMO and now is not the time to buy anything really. Bank what you can and wait a while?

Shermanator

Thats some great advice from everyone, thanks very much

I never thought about the fact that flats would suffer a greater hit if they keep going down. Also, if I were in a house and the prices dropped I would be happy to stay for at least 10 years I would like to think, whereas I am ready to move on now so don't fancy being stuck here until the market recovers

pamaris

Shermanator wrote: »

Thats some great advice from everyone, thanks very much

I never thought about the fact that flats would suffer a greater hit if they keep going down. Also, if I were in a house and the prices dropped I would be happy to stay for at least 10 years I would like to think, whereas I am ready to move on now so don't fancy being stuck here until the market recovers

There is your answer then. Good luck!

ixwood

Selling to rent/lodge/share does make sense if you're definitely selling anyway.

And having no property to sell and cash ready would put you in an incredibly strong position in the current/coming market.

If prices drop a relistic (imo) 25%, that's 40k saved. 40k on 25 mortgage turns into 80-120k paid back and more years on the mortage/less equity.

Plus as a cash buyer you'd then be able to push for the extra discount your position is worth as well.

Plus 40k less stamp duty.

ixwood

You might be able to upgrade for free, or even get paid to upgrade if you play your cards right.

sunshine_shell

ixwood wrote: »

You might be able to upgrade for free, or even get paid to upgrade if you play your cards right.

Could you explain that please?

ixwood

Say you sold you flat now for 140k, banked the cash and rented somewhere cheap, or stayed with friedns/parents, lodge, house share etc.

If the market was then to drop say 25% (easy maths and not particularly unlikely IMO), the house you were going to buy is now worth 120k. You use your good "No chain, ready to go" position in a buyers market, get it for 115k. In theory you've got the new house and 25k left over.

Of course, ther's fees etc and the rent/boarding money to take into account, but do you get the idea?

And as mentioend, any saving you can make on the purcahse price are then further mulltiplied by the interest saved. So in the example, you've saved 45k on the purchase price, so in effect saved yourself 90-135k overall (assuming it takes 25 years to pay it off).

ixwood

There;s a lot of assumptions and was just to give you an idea.

Worst that could happen IMO is prices stagnate and not fall more. In which case you're in no worse a position.

sunshine_shell

Thanks, we're looking at putting ours in the next couple of weeks