Property -Views please

meanmachine_2

Aren't we getting to the point where people leave uni with huge debts, take years to pay it off, then by the time they're debt free find that property is eight times their salary, decide they have to rent for the next ten years...a much loved relly dies in that time and bingo...

Property ladder has been reached, without the need for EAs or banks' money.

The only other loser in this scenario is the poor old relative. But then they had a life of affordable housing, unlike me.

Spendless

meanmachine wrote:

Aren't we getting to the point where people leave uni with huge debts, take years to pay it off, then by the time they're debt free find that property is eight times their salary, decide they have to rent for the next ten years...a much loved relly dies in that time and bingo...

Property ladder has been reached, without the need for EAs or banks' money.

The only other loser in this scenario is the poor old relative. But then they had a life of affordable housing, unlike me.

I have to admit I wonder if my kids are looking at having a huge debt to pay back before they start their working lives and mine are currently only 5 and 2 years old.

Of course the problem with them eyeing up eventually inheriting is that the surviving parent may need to go into care and the house be sold to pay the bills.

the surviving parent might re-marry and then die first living the place to the new partner.

the money might be spent by surviving parent, taking out equity or ringing up debt that has to be paid out of estate on death.

lush_walrus

meanmachine wrote:

Sadly I wouldn't be horrified, as I have a number of seemingly intelligent mates who have done this very thing, thinking that they'd forever be "left behind", or had "missed the boat".

Sound familiar? It's typical EA speak - lies, in other words.

And the Bank of england is suddenly wondering why the economy ground to a halt at 4.75%.

With such huge mortgages, even a .25% cut or rise suddenly seems very large. Which is why the bank only nudges up and down, unlike in the good/bad old days when int rates were push up a whole percentage at a time.

Meanmachine, its ultimately the mortgage companies who are at fault on this one. I know you have a dislike for agents which is fair enough if thats how you feel, but you have to admit that they do not set the level of lending or have any control over banks. It is the banks who ultimately should demand proof of earnings (as they traditionally did) and only lend on proven accounts or on salary. Its greed on their behalf which is continuing to fuel the market, not the agents on this one!

lush_walrus

meanmachine wrote:

Effectively my spending/savings habits are out of kilter with the current market, or what the economy needs. I have savings and would benefit from a high interest, higher inflation, but lower house price economy. That would be the death of today's consumer led economy.

Sadly, I'm beginning to think that the circumstances will never be right for me to buy, therefore I never shall. I'll probably just rent, then inherit a place in 25 years' time. It'll be much cheaper that way - for me personally anyway.

Exactly the point circumstances are never right for anything, there is always a counter arguement for any arguement. So if you want to buy then choose a time that suits you and bite the bullet. If you are happy renting then rent, there is no right or wrong only what suits the individual person.

But in all honesty (and this is a question for yourself rather than the forum) are you truely happy with renting? From what I have seen of you around the forums property is your biggest interest, so it strikes me that you would prefer to be a homeowner rather than rent. If thats the case then really really push to get there, without excuses of this that and the other. Its a very big move, but blocking out all of the negatives really is the only way if thats what you want.

Ian_W

Meanmachine wrote: The only other loser in this scenario is the poor old relative. But then they had a life of affordable housing, unlike me.

Jammy b***ards I say!!
And if over 65 they'd have enjoyed the War, the Blitz, Food Rationing, post-War austerity, 3 day week, Mrs.T and numerous recessions. All that AND affordable housing - some people just didn't know they were born!!
No wonder they call them
THE GOOD OLD DAYS!
:rotfl:

competitionscafe

Ah the great house prices debate. Interesting article here:
http://www.alansteel.com/archives/articles_quotes.aspx?id=637

"What does he know about property? Actually quite a lot. Simon is a successful property multi-millionaire. He still owns property in Melbourne and New York as well as Spain. But recently he sold all his UK properties, including his commercial property empire. Now, he’s seriously thinking of dumping the rest. "
rest of article: http://www.alansteel.com/archives/articles_quotes.aspx?id=637

And in this weeks Money Week magazine there was a good article saying that the statistics we have now (stagnant market) are all based on properties that actually sell and does not take into account the huge quantity, perhaps even the majority that just don't sell.

I know there are 3 flats on my street that have been on the market for months and are just not shifting (the prices are just too high) whereas at the beginning of this year the flat next door to mine sold and one across the road both sold within a couple of weeks. And this is in Edinburgh - the article quotes examples in London (which is probably a bit ahead of the rest of the UK) where flats have been on the market for up to a year without selling even when the asking price was dropped by a quarter.

Even if there is no crash, even the more optimistic are saying there will be low or no growth - so as an investment property does not look good. On the other hand for your own home as long as you intend to stay where you are for a while you might be okay. Personally though I am happy to rent for another year or two until things become clearer.

meanmachine_2

There's an article in today's Mail, basically asking investors what they'd do with 100K.

Those who are heavily geared into property recommend you...wait for it...buy into property, no doubt to sure up their investments. Duh!

Those without a property axe to grind suggest you run a mile from anything looking remotely like a house.

The property "millionaire" (presumably only on paper) thinks he'll be able to turn 100K into a million in 10 years.

Wow. Can't fail. Let's all join the gold rush.

meanmachine_2

Update on my street:

Three months ago I mentioned that a house had been up for sale, ridiculously overpriced. Didn't sell. Owners put it up for rent.

Well, three months later, they've found tenants. DSS no doubt.

Meanwhile the larger property which had been on the market for a year and which had finally sold...that's now back on the market at the SAME price at which it languished there for a year.

I think the owners must already have bought and simply can't afford to drop their already inflated price.

Fancy supporting two mortgages for more than six months? No, nor me.

greencat_2

The Grauniad reckons things could get nasty:

http://www.guardian.co.uk/business/story/0,3604,1544462,00.html

I'm a first time buyer too - but having looked at the latest Land Registry figures:

http://news.bbc.co.uk/1/hi/business/4747919.stm

and done a postcode search, the prices in the two areas I'm looking at have fallen by 1 and 4% over the last 3 months and sales are way down. Renting is cheaper than paying the interest on a mortgage for a similar sized place so I reckon I can afford to continue saving for a year or so to see what happens.

eurows

Incidentally in some very developed countries like Japan and Switzerland prices have risen so high that either the only option is to get a 50 or 75 year mortgage (yes really!!) or many people just have to accept that they will never be able to buy their own place. While like I said I am not at all trying to predict the market or saying that prices definitely won't fall I don't buy into the argument that 'what comes up must come down' and that because there has been a crash before there will definitely be another one.

Actually I think you will find Japan has fallen by 40%. Just imagine how those japenese buyers feel now. Its going to happen here. Stop yourself feeling like that. Don't buy now.