FTB's - don't buy now!

Conrad

The worlds smart investors, people like Warren Buffett (richest in world) and Gerald Cohen are saying we are in falling price territory and that the slide will continue for a couple of years.

Buying property in this slump from forced sellers should mean substantial savings for smart buyers. This will mean for example that those people might as a result retire 10 years earlier than otherwise would have been the case.

There seems to be a body of people that dont follow the news at all and have no clue about markets. They just drift along in some kind of rose tinted parallel universe.

dannyboycey

HammersFan wrote: »

I guess only time will tell whether what I said was very unwise.

You 'guess' only time will tell? It's like you are living in an alternative dimension in 2007. Time has already told my friend. The hour is upon us - you only need to take a look at the likes of 'Property Bee'.

dannyboycey

Conrad wrote: »

The worlds smart investors, people like Warren Buffett (richest in world) ...are saying we are in falling price territory and that the slide will continue for a couple of years.

If only he had Hammersfan as an adviser.... :rotfl:

carolt

HammersFan wrote: »

But people have been making predictions (that are stated with certainty) about a crash / correction for years. We still havent got one yet.

If as a FTB I had a decent deposit, and got a reduction of, say 10% when I went to buy, then I don;t see the reason not to go ahead. It will take a good while to see falls of 10% if they occur.

I haven't been making predictions about house prices falling for years. As I've said many times before, I first came to this forum just over a year ago, seeking advice on a house we were trying to buy. I got great advice - especial thanks to Doozergirl, who took the time out to try and help me - but as luck would have it, the sale fell through. (And yes, I do think we were very lucky it didn't work out.)

I think I've called the market at exactly the right time, thank you. Had I bought then, I would have got a property I could (just about) have afforded. Prices immediately jumped, making (a) prices unaffordable in my area (b) prices blatantly so overpriced that something had to give.

As to the second point, if even the Nationwide are predicting falls of 5% this year alone, then I see no reason why we shouldn't see falls of 10% this year - let alone in future years. If America can lose 12.6% in a year, then who's to say we can't do the same. (See my thread re yesterday's FT article on just this subject.)

So maybe my original post should stand corrected, to satisfy the HPI pedants:

FTB - DO BUY A HOUSE NOW, AS LONG AS YOU DON'T MIND LOSING ALL YOUR EQUITY WITHIN THE YEAR, AND ENDING UP IN NEGATIVE EQUITY THE YEAR AFTER.

Sorry to shout - had caps lock on accidentally, but I am happy to emphasise the point.

Great time to buy - if you enjoy debt and like watching the value of your asset fall week by week.

ka7e

Advice I had from a friend "Never try and catch a falling knife. Wait until it hits the floor"

He's an estate agent and successful property investor.

HammersFan

dolcevita wrote: »

I've just made myself a sandwich and when I looked at the bread packaging it reminded me of you.................






.........................Then I realised I misread it - it said "thick cut"

:rolleyes:

Imaginative, but really quite out of order. Very brave of you to post something in a forum you proably wouldnt be prepared to say face to face.

WTF?_2

Skyhigh wrote: »

I've skipped a few posts on this thread but here's my view/status.

I'm a FTB.

I'm due to complete on a house in about two weeks.

Renting in my area is the same cost (and sometimes more) as a mortgage, most of the time you're paying someone elses mortgage (buy to let).

Rent at £600-700 per month (semi detached!).

Or buy with a mortgage at £750 pm.

Rent for three years = £27,000


So, either I buy now and get my own house, or rent and throw money away for 3 years - wasting £27k.
In this light, in 3 years time the house prices would have to drop by MORE than £27k in order for me to have "saved" money.

The house I'm buying is £150k, so it would have to fall to £123k.
It was built in 2004, and sold originally at £115k.
All in all, quite doubtful.


By the way, I just happen to live in South Elmsall - area with the cheapest street of houses in the UK :
http://www.guardian.co.uk/money/2008/mar/14/houseprices.property

So general property prices are low here, I doubt they'll fall too much anyhow.

Where else can you pick up a 3/4 year old, three bed, two bathroom, detatched house, on a nice new estate, in a cul-de-sac, 5 mins walk from a train station, with views over fields.....for £150k?
Not many places

That's great but you are very much the exception to the rule. You live in the cheapest area of the UK and around your parts renting and buying work out roughly similar. Also, because the place is at rock bottom price levels it has less far to fall.

What's about to happen is that the rest of the UK falls back more to the norm, which you are very close to aleady.

Having said that, I would still wait for price falls as every pound borrowed equals more than two pounds repaid over the period of a typical mortgage. Getting the place 10k cheaper could save you 25k in the long run.

hotrod21

Oh no! What do I do? I bought my flat in May 2007 as a first time buyer... Oh well, suppose I'll just sit and wait for the crash. What else can I do? (ANy suggestions would be greatly appreciated)

Skyhigh

Slight exceptions, yes.

At this point, I'll highlight that the house is "worth" £165-£168 but we're actually getting it for under £150k. Moneysaving ftw!


:!:

JonnyBravo

Skyhigh wrote: »

At this point, I'll highlight that the house is worth £165-£168

Not for long though.



Hang on I'm turning into dannyboycey, or is it !!!!!!?..... or even....... carolt??!!!