FTB's - don't buy now!

rizel23

To buy the house i'm currently in it would cost me twice what i pay in rent!

It can only go on so long, i'm just gonna keep saving till prices drop, if they don'nt (which is highly unlikely as asking prices are going down all the time where i live) then i still will have saved loads for a deposit and have and the benifits of renting at the same time.

chriz1000

One of three things will happen. Ether the prices of houses will drop significantly, the rental on property will increase significantly or they will meet somewhere in the middle.
In my opinion don’t bank on rentals being significantly lower than mortgages forever, landlords have to make a profit to stay in business. To be honest it could swing ether way, I say if you can afford to buy a house than go for it. I’m a first time buyer, my mortgage is £200k and monthly repayments are less than a quarter of mine and my girlfiends income if you can afford the repayments you have nothing to lose.

JonnyBravo

carolt wrote: »

JonnyBravo, thanks for acknowledging, albeit in the penultimate paragraph, that maybe I am 'reasonable' after all! (After several paragraphs explaining why I'm not!).

May I be so bold as to suggest this is roughly the correct proportion for the number of times your posts genuinely help someone and the number of times your posts are, in my oponion, simply a long repressed cry of anguish that you didn't manage to get your property back in 2000?

carolt wrote: »

I've never made any secret of which side of the fence I'm on - as a history graduate, I'm well aware that everyone has a bias: the ones you have to watch are the ones who don't declare it.

After all, as you correctly point out, it's not as though the title of this thread was subtle.

Indeed not. No-one will accuse you of fence-sitting, nor indeed of posting an ambiguous title.
Also as a graduate (:p ...;) ) I have been taught that those who have the propensity to be most biased are those who have been most affected. May I humbly suggest that you are in that position, with your house purchases having fallen through in the early 00's?
Have I been affected? Of course. I bought in '98 and again in '05 and would love to think of property forever rising, (thankfully I'm not so naive as to think it will), but so long as I'm not in negative equity when I'll be looking to move in c.10yrs time I don't really mind. You see I'd be selling to buy anyhow. (I will only start to worry come a 60% crash.)

carolt wrote: »

You're right - I do presume to advise other FTB's - partly, I'm older than a lot of FTB's and so have a slightly longer perspective, having been trying to buy my first home since 2000 (and failing); partly, because as an educated part-time working mum, I have more time than most and plenty of inclination to read as much as I can on the subject of the housing market. I'm shocked by the number of FTB's who come on here still posting the 'house prices can only ever go up, renting is dead money...' mantra they've swallowed hook line and sinker off some property !!!!!! show. I am old enough to remember the last crash, and if I can save a few of those innocents from a ghastly mistake, then, yes, I do think I've done some good in my day.

If that's patronising, then I'm happy to be patronising.

Indeed it is patronising.
To presume you know better than other FTB's simply as a result of your age is a poor yardstick.
I'd rather listen to someone with experience of having made sound decisions and, unfortunately, you can't claim to have done that. Whether that is through your reticence in the market (as I suspect) or simply consistent bad luck is a moot point. (from '00 to ? ....when did you realise you could no longer afford the type of house you were after? Around Mar '06?) Indeed this is the same point made by HammersFan later on but it was worth re-iterarting.

I'm sorry no-one was around to stop you from making your "ghastly mistake" but your whitewash approach to advice isn't really advice. Try helping individual requests or queries if you genuinely wish to help people or be honest enough to put your hand up and admit that's not your main motivation.

Cheers,

JB

carolt

HammersFan wrote: »

I do, however, think that its a bit strange that you are giving out advice since by deciding not to buy 5-6 years ago you have put yourself in a significantly worse financial position than you would have been if you had bought property. By now you would have had some good equity in your pocket to sell and rent with for a while.

If you had read my post carefully, you would have noticed that I didn't say 'chose not to buy', I said 'failed'. Until last February ie Feb 2007, we were fully committed to buying and had put in a number of offers on houses that fell through for a range of reasons, from sellers changing their minds and taking house off the market for no apparent reason, once price had been agreed, to woman going through a divorce with no legal rights to sell the house as ownership was disputed. Lots of flaky sellers out there! :rolleyes: Anyway, as we live in a very small village, where our kids go to school, buying elsewhere wasn't an option and suitable houses, within budget, only come up for sale very, very occasionally.

So it's not that I decided not to buy 5 or 6 years ago - I absolutely agree that had I done so I would be significantly better off financially. Even say 4 or maybe 3 years ago. But when we changed our minds last year about buying, and decided enough was enough, it was because prices had just taken another, completely unrealistic and unsupportable leap - and not just in my area. I strongly believe that buying NOW - unlike 6 years ago - would be a HUGE mistake, for me, and virtually all other FTB's, hence the thread.

It's not that I'm against buying per se, but timing is everything - and this is THE WORST POSSIBLE TIME TO BE A FTB.

HammersFan wrote: »

Why shouldn't first time buyers take a risk and go for it? If there's a good deal about then why not take it - there's nervousness in the market and some deals to be done. In loads of places renting is no cheaper than a mortgage (still).

Not true - there are almost no places left where this is the case. But in those few areas, then, I agree, the case for buying now, even as an FTB, is much, much stronger.

HammersFan wrote: »

By staying out of the market people are betting everything on a fall in the market.

You seem to think it is impossible - but what if the credit markets free up along with a drop in interest rates? Mortgage lenders will be back sniffing out business with good deals and prices can rise very quickly. And the longer the 'stand off' between buyers and sellers goes on (not many forced sellers) the more pent up demand there is in the market. What would you do if this happened - would you sit and wait for the crash (still) or would you bite the bullet and accept that prices aren't going to fall significantly?

I'm no financial expert - but I do know that all the financial experts out there, from the Fed & the Bank of England down, are saying this isn't going to blow over for a while. Would I buy anyway at these prices? No, that would be financial suicide when it so much cheaper to rent. I'm not that hung up on home ownership that I'd rather cram my family into a manky 2 bed flat rather than a roomy house with a big garden just so I could have my name on the deeds and an obscene mortgage to keep me awake at night!

HammersFan wrote: »

You present a very one sided view of the situation and people are right to pull you up on it. The press just love a good story - they know house price stories sell papers. Its just not possible to call the market with any certainty.

I have asked this question before but.....if I offered you a house at two prices: price 1 is the price it is today, price 2 is the price it will be in 5 years time, and you didnt know how much either price was, which would you take?

I don't try to present a one-sided view - it is a simplified view, as there can always be individuals whose individual circumstances are sufficiently unusual that they are the exceptions that prove the rule. I present the truth as I see it; others are welcome to disagree (as long as they do it with some evidence more than 'I feel it in my waters'...!).

As m00m00 says above, your theoretical question is meaningless, as I don't know what prices will do in 5 years time - it's a long time. If you say 1 year, I'd be pretty prepared to make that call and say I'd take next year's price, thank you. In 5 years, prices may well be lower - but then different regions will react differently. A lot can happen in 5 years, including having the house you bought at the peak of the market being repossessed, because you couldn't meet the payments, and having to live with thousands of pounds worth of debt for a house you no longer even live in.

Predictions on the housing market in 5 years time are interesting, but make for a different thread.

Re my original post, my point still stands: FTB - don't buy now!

carolt

JonnyBravo, you seem determined to post personal invective in the place of reasoned argument.

No idea how long you've been lurking on this forum, but your name is not a familiar one to me. Maybe if you'd been around a bit longer, you'd have noticed that I post many helpful posts to individuals concerning their individual circumstances, and they are a long cry from some sort of blanket 'Don't buy!' advice. Research before you criticise others.

Of course I post because the housing market affects me - it is an idiotic suggestion that I, or any of the others who post here when we could be doing something else, are not personally involved. (With a respectful nod to pasturesnew here, who 'just likes it here'!) But the fact that it would benefit me if house prices fell, does not, however much those who wish for the contrary would like, invalidate my views, or make it one jot less likely that prices will fall. And it doesn't mean for one second that I don't get a good feeling every time I think I've helped someone avoid a horrible financial mistake.

Prices will fall, whether I like it or not (I do...): I am convinced enough by the views of every single financial and housing expert out there.

Rather than attempting to discredit my argument by discrediting me, maybe you could actually address the argument.

If you have some hard evidence that house prices will or must rise, then by all means contribute to the debate. If you wish to waste space by attacking me, why not PM me instead, so I can ignore it in private, without boring others?

wolvoman

dolcevita wrote: »

...............and while all you HPI cheerleaders are at it, could you answer me one simple question..........

Why are massively rising house prices a good thing?

They're not.

If they rise or fall within a +9% / -1% bracket then that would be ideal, both for individuals and the wider economy. Of course I'm talking nominal prices, real prices would ideally fluctuate between +/-5%.

dannyboycey

wolvoman wrote: »

They're not.

If they rise or fall within a +9% / -1% bracket then that would be ideal, both for individuals and the wider economy. Of course I'm talking nominal prices, real prices would ideally fluctuate between +/-5%.

How so? I don't get those figures.

I also have a problem with the term 'ideal, both for individuals and the wider economy' - There are always winners and losers / rich and poor. That's how a capitalist society functions whether you agree with it or not. There's no magical solution to this that will suit everyone. Some people will do very well. Some will lose everything. Many more will be in the grey areas between.

JonnyBravo

carolt wrote: »

JonnyBravo, you seem determined to post personal invective in the place of reasoned argument.

I'm sorry that once again you seem to have assumed my post was abusive. It was, of course, not meant in any such manner. I apologise if it came across so.

carolt wrote: »

No idea how long you've been lurking on this forum, but your name is not a familiar one to me.

I don't mind filling in a few gaps for you. I'm more usually on the "MFW" board but like to pop over into "the ghetto" occasionally for a view of a few threads. (Having said that I'm more a lurker than a poster as my post count shows. The MFW board is a quiet affair, very different to here!;) ) I guess I was in a mood for a chat about a few "points" I saw you raise. Unusual for me, but us men are strange folk.

carolt wrote: »

Maybe if you'd been around a bit longer, you'd have noticed that I post many helpful posts to individuals concerning their individual circumstances, and they are a long cry from some sort of blanket 'Don't buy!' advice. Research before you criticise others.

Let's have a look.... (please forgive my small amount of research but it's staring me in the face and..... well..... it's like an itch that you know you shouldn't scratch but it feels oh so good! )

carolt wrote: »

I strongly believe that buying NOW - unlike 6 years ago - would be a HUGE mistake, for me, and virtually all other FTB's, hence the thread.

oooo... careful ..... you're being softened up, don't forget the title!!:D (

carolt wrote: »

Re my original post, my point still stands: FTB - don't buy now!

Ah, thats better, things are back on track I see.:D

carolt wrote: »

Of course I post because the housing market affects me - it is an idiotic suggestion that I, or any of the others who post here when we could be doing something else, are not personally involved. (With a respectful nod to pasturesnew here, who 'just likes it here'!) But the fact that it would benefit me if house prices fell, does not, however much those who wish for the contrary would like, invalidate my views, or make it one jot less likely that prices will fall. And it doesn't mean for one second that I don't get a good feeling every time I think I've helped someone avoid a horrible financial mistake.

Prices will fall, whether I like it or not (I do...): I am convinced enough by the views of every single financial and housing expert out there.

Rather than attempting to discredit my argument by discrediting me, maybe you could actually address the argument.

But my argument isn't about the fact that prices are going to drop.
I agree they are and will continue to do so.
My argument is about the fact that what you are currently typing isn't advice and almost certainly isn't stopping any FTB from making a ghastly mistake. If you want to advise then you must give targetted advice to individuals about individual circumstances.

carolt wrote: »

If you have some hard evidence that house prices will or must rise, then by all means contribute to the debate. If you wish to waste space by attacking me, why not PM me instead, so I can ignore it in private, without boring others?

Come, come, carolt, we both know healthy reasoned debate in the open, where all share open and honest views is a much more healthy way of conducting ourselves.... besides I'm not sure I'd trust you in a small dark room..... arrghhhh... where did you pull that ice pick from???? :eek:

brit1234

First time buyers don't buy, 6 months of falls with the biggest next month likely to be 1% fall.

The market is Crashing, wait and save.:beer::j

We are following the US due to our previous dodgy lending.

flipcat

Bring it on I say,house prices are pathetic and it would be nice to see people being able to step on the property ladder again,I personally cant wait:Thow nice it will be to see the generations to come step on that ladder with ease. Im not saying a crash just more realistic house prices that "normal" people can afford,youngsters of today dont stand a chance unless living at home with parents and saving till they are getting old.