First time buyers + Crash. Is this our chance?

Sapphire

Treadmill wrote: »

Thats just an opinion, you can't guarantee anything can you ?

No, it's not my job to 'guarantee anything'. If you haven't heeded the warnings over the last couple of years, that's your loss, not mine. Carry on burying your head in the sand by all means. :rotfl:

Treadmill

Sapphire wrote: »

No, it's not my job to 'guarantee anything'. If you haven't heeded the warnings over the last couple of years, that's your loss, not mine. Carry on burying your head in the sand by all means. :rotfl:

It makes no difference to me either way as it happens, I'm not planning on moving and have oodles of equity in my property, I borrowed 103% in 1998 and was given all the negative equity horror storys back then, I've seen friends sell up starting in about 2003 and wait for the crash who are now paying more than twice my mortgage in rent.. I pay £260 a month, I'm fixed for the term now at 5.99.

There might be a downturn now but in 10 years from now those people who borrowed 100% to buy, even in the last couple of years will be quids in... simple as that.

if its not your job to guarantee things why do you say you will in your posts ?

Turnbull2000

Treadmill wrote: »

It makes no difference to me either way as it happens, I'm not planning on moving and have oodles of equity in my property, I borrowed 103% in 1998 and was given all the negative equity horror storys back then, I've seen friends sell up starting in about 2003 and wait for the crash who are now paying more than twice my mortgage in rent.. I pay £260 a month, I'm fixed for the term now at 5.99.

There might be a downturn now but in 10 years from now those people who borrowed 100% to buy, even in the last couple of years will be quids in... simple as that.

if its not your job to guarantee things why do you say you will in your posts ?

I suppose if you do keep it simple enough and blissfully ignore all the other fundamental questions, then yes, you do put forward a good argument.

There's a pattern emerging on this forum. The few that still dismiss the odds of a crash or don't want a reduction in prices view property as a money making venture (not sure how you can be "quids in" when you live there?) and not a home. Hardly surprising.

m00m00

The FT index quoted earlier in this thread uses LR data and is thus lagged.


only the most blinkered bull would say the market was less 'challenging' than it was 3 months ago.

the key stat to keep an eye on is mortgage approvals. That's the interesting one, all the others are just static on the radio.

even the LR one is flawed in it's methodology by not including repossessions and 'forced sellers'

UK007BullDog

I don't think there will be a big crash. A correction maybe.

Lets be frank here, just because prices come down does not mean people are going to sell in panic. Some do of course, but most wont. I wont, because renting is such a pain and the cost will be more for me than my mortgage. My mortgage is around £500 and the going rent for an equal house is £1200. So I would be mad to sell. I think most people will just settle down and wait it out.

As the lenders are starting to be picky even with a big deposit there are still issues for the FTB in a falling market. The only chance are repossessed properties or BTL'es who stepped into the market too late.

So one can wait and hope, but I think the wait will be futile.

Generali

UK007BullDog wrote: »

I don't think there will be a big crash. A correction maybe.

Lets be frank here, just because prices come down does not mean people are going to sell in panic. Some do of course, but most wont. I wont, because renting is such a pain and the cost will be more for me than my mortgage. My mortgage is around £500 and the going rent for an equal house is £1200. So I would be mad to sell. I think most people will just settle down and wait it out.

As the lenders are starting to be picky even with a big deposit there are still issues for the FTB in a falling market. The only chance are repossessed properties or BTL'es who stepped into the market too late.

So one can wait and hope, but I think the wait will be futile.

It's not so much people selling in panic, its that ultimately some people need or want to sell (eg moving areas, need a bigger house, can't afford to keep the current place).

If your house is worth a bit (or a lot) less then it doesn't really matter so long as it's worth more than the mortgage as the place you're going to buy will be worth less too.

In the short term the market will bung up as sellers hold out for higher prices (where we are right now IMO). Eventually either buyers will have to increase what they will offer (which seems unlikely to me given what is going on in the lending market) or sellers will have to decrease asking prices or not sell.

WTF?_2

Treadmill wrote: »

It makes no difference to me either way as it happens, I'm not planning on moving and have oodles of equity in my property, I borrowed 103% in 1998 and was given all the negative equity horror storys back then, I've seen friends sell up starting in about 2003 and wait for the crash who are now paying more than twice my mortgage in rent.. I pay £260 a month, I'm fixed for the term now at 5.99.

There might be a downturn now but in 10 years from now those people who borrowed 100% to buy, even in the last couple of years will be quids in... simple as that.

if its not your job to guarantee things why do you say you will in your posts ?

Do I get this right - because buying worked out for you in 1998 you are recommending people buy in 2008? Good grief. :rolleyes:


It's misguided 'advice' like that that is going to wind anyone buying now, at 2008 prices in with the current market outlook in a world of financial pain.

If price vs salary was at 1998 levels I'd be recommending everyone jump into the market too. However, I can see that what works in 1998 doesn't work in 2008. You apparently are commenting on the wisdom of buying in todays market based on the specific conditions of the market a decade ago which benefited you.

Topher_Bear

UK007BullDog wrote: »

I don't think there will be a big crash. A correction maybe.

Lets be frank here, just because prices come down does not mean people are going to sell in panic. Some do of course, but most wont. I wont, because renting is such a pain and the cost will be more for me than my mortgage. My mortgage is around £500 and the going rent for an equal house is £1200. So I would be mad to sell. I think most people will just settle down and wait it out.

As the lenders are starting to be picky even with a big deposit there are still issues for the FTB in a falling market. The only chance are repossessed properties or BTL'es who stepped into the market too late.

So one can wait and hope, but I think the wait will be futile.

I'm wondering when you got your mortgage, how much deposit you had, and what type of mortgage (ie repayment, year term). As for the last few years I have found it cheaper to rent than to buy an equivalent property on a 95% mortgage over a 25 year repayment term. In fact it has got so bad that i would find myself paying nearly double my current rent for such a mortgage. To me its a no brainer...I stay renting.

To buy or not to buy right now (assuming you could actually get a mortgage!)?

Chances of prices rising substantially in next year: zero!
Chances of prices rising a little in next year: low.
Chances of prices remaining static for next year: Moderate
Chances of prices falling slightly for next year: high
Chnaces of prices falling lots in next year: Well that depends on who you talk to.

With those as a guide, I'd say, hold on for a bit and see what happens, you won't lose out if it doesn't fall, but you could gain if it does!

My other point about current situation is that with mortgage lending likely to be half this year what it was this year, thats a huge wapping reduction in money going into the housing market. The money from mortgages is the biggest driver in house prices, so with this kind of reduction, we could see some massive falls.

We bought a paper today (looking for a bigger rented place so we can adopt!) and I was a little surprised to see that one of the agents were advertising their properties not just as "price reduced" but also "Repossession"!! (a 1 bed and a 4 bed, for those interested in anecdotes and market indicators - cross the board?)

Topher Bear

MrSafeGaz

Topher_Bear wrote: »

Chances of prices rising substantially in next year: zero!
Chances of prices rising a little in next year: low.
Chances of prices remaining static for next year: Moderate
Chances of prices falling slightly for next year: high
Chnaces of prices falling lots in next year: Well that depends on who you talk to.

With those as a guide, I'd say, hold on for a bit and see what happens, you won't lose out if it doesn't fall, but you could gain if it does!

I agree with this entirely. This is the key thing that first time buyers who are in a position where they don't have to buy need to remember. Simply put, there is a very high probability that sitting back for a while is a win-win situation.

santashelper_2

although first time buyers have been waiting for house prices to drop it doesent matter how much they drop because if they dont have a deposit and credit is going to be harder to come by they will still struggle to get on the property ladder.

For people whos homes have gone down in value if they are moving then the house they are buying has also gone down in value so the money they could owe would be less than if their homes were worth more.