FTB - Should I pull out?

Kez100

As someone who suffered negative equity right at the bottom of the last market can I advise the following :

If you buy, and that can only be your choice, make sure you save as much as possible each month to help towards any negative equity situation. Also make sure the property you are buying now is a great property for resale as, at the bottom of the market, our experience was being priced right wasn't enough - to get that buyer you needed to either give the property away or stand out from the crowd and not come up with any survey problems. Have in mind at all times the bottom of the market last time took five years to reach.

NickDurham

Kez100 wrote: »

As someone who suffered negative equity right at the bottom of the last market can I advise the following :

If you buy, and that can only be your choice, make sure you save as much as possible each month to help towards any negative equity situation. Also make sure the property you are buying now is a great property for resale as, at the bottom of the market, our experience was being priced right wasn't enough - to get that buyer you needed to stand out from the crowd and not come up with any survey problems. Have in mind at all times the bottom of the market last time took five years to reach.

Thanks for that advice. Part of what's putting me off a bit is the sulphate attack problems which may come up in the future, as well as the fact that the roof does have some asbestos - this isn't a problem in itself at the moment, and it's a small percentage/low grade, but it may put some potential future buyers off, I'm guessing.

AMILLIONDOLLARS

If your not sure about this property I would do a quick look around to see what else is on the market.

AMD

lawrie28

Go for it!! If you like the house, and there are no problems with the sulphate floor (which sounds expensive if there is) then I think you will be ok. The house is not vastly expensive, so it's not like no-one will be able to afford it going forward, it's not a multi million pound mansion. If it means that you, the wife and the daughter can be happier ( having a wife and 2 daughters can appreciate what you are going through) and can live in a house that will enable you to live better then look at it this way: if you lose some cash, but are really happy, it's money well spent. If you stay where you are, or rent elsewhere and are not as happy, then it's money wasted. Of course, you could rent somewhere else, and guarantee to lose money on the rent..... and still be happy. Having rented for 9 months, and completed last week, it is such a nice feeling to to things to a house without having to worry about it being OK with someone else (other than the wife)..

BiggaThanBen

NickDurham wrote: »

No. When I got the mortgage I asked whether I could transfer it onto a different property within its validity period. I was told yes. The original amount we were pre-approved for was 11k more than the price of the property we currently have been accepted for. Again I asked whether, if the new property was more than this one, whether the deal remained, and I was told it was, up to the original amount of the mortgage. Does this mean you would advise looking at a different house and getting a better deal (we have a couple in mind)?

But they did not say anything about the rate, right ? They may say, - "Yes the offer is still valid, but it is now 6.5%, sorry ..", I would check that.

I would try, you are not losing anything by asking .. the current seller might look like he is not accepting anything less than 130K, but how knows ...

moneysavinmonkey

NickDurham wrote: »

The mortgage is portable (I was told), the only thing being I would have to pay for any subsequent valuation as they only paid for one free. Does this make the third option I outlined (buying a different house at a bargain price) the most attractive one in your opinion?

ah ok, I understood (wrongly) that the mortgage was only valid on the property you currently had an offer in on from where you said this:

NickDurham wrote: »

it gave us 2 weeks to put the address of the house down

if it's portable and valid for nearly 3 months I would definitely have a look round at other properties and perhaps try some cheeky offers to see if you can get a better deal and a more saleable property (ie without sulphate whatists and asbestos!)

pinkshoes

How much are you paying in rent?/How much would it cost to rent an identical property to the one you're thinking of buying?

Your repayment mortgage (25 yrs) will be around £800 a month, and £590 of this will be interest. If the potential rent of this property is less than £590/month, then it would indicate it's a bit overpriced, but if you're planning on staying for at least 5 years, then it shouldn't matter if prices drop a bit.

NickDurham

pinkshoes wrote: »

How much are you paying in rent?/How much would it cost to rent an identical property to the one you're thinking of buying?

Your repayment mortgage (25 yrs) will be around £800 a month, and £590 of this will be interest. If the potential rent of this property is less than £590/month, then it would indicate it's a bit overpriced, but if you're planning on staying for at least 5 years, then it shouldn't matter if prices drop a bit.

Current rent is 550 per month, which is pretty good (similar sized property, better area, but house not in good nick). I'd said rent would be about the same as the interest in the house we'd move to, but maybe a bit less. Problem is we really do like the house and it has a fabulous garden (very appealing when you've got kids!).

Thanks everyone for the advice. At the moment I'm thinking of getting a structural engineer to look at the reports and tell me once and for all whether the floor/roof issues are or would be a potential problem in 5 yrs for reselling. If the answer's no then, despite the fact I don't thik we're getting a great price, I might be tempted to go for it. Otherwise, we'll look at a handful of properties and try to make a cheeky offer whilst we milk the withdrawal procedure on the 1st house to buy us a week or 2. If we get accepted then we swap houses on the mortgage, if not then it's rent and save for a few yrs more. Not sure if people think this is the best option.

Again, if it was purely a financial decision it would be easier... but, as a few people have mentioned, the fact of having your own house, nesting instincts, bad state of repair of rented house, etc, all have to be factored in as well, and there are much less easy to calculate!

lawrie28

If it has a big garden, you can always extend instead of moving......then dont need to worry about the issues in 5 years....