Another report that says housing market continues to cool

Mr_Proctalgia

" It's those who do have to sell, for whatever reason, whose price is put into the official figures."

Erm - I thought all sales went into the "figures" not just those that have to sell?

Meany - If you choose to rent and save then good for you, however personally I think you ought to have your bumps felt. Why not buy and save instead, you know yourself that the long term trend is going to be upwards, is it because you think you can rent a better place than you could buy? If this is indeed the case then you are suffering from the arrogance of the younger generation who believe that they own the "right" to a certain lifestyle.
A lot has been written about how much more affordable our parents houses were. What utter poppycock, you were not around to see the struggling that went on in order to service a smaller mortgage with a much smaller wage - It most certainly was not a case of a champagne lifestyle - more a case of a packet soup life style.

Think about this - I can borrow a thousand pounds for about £5 per month (and that would include a tiny tiny amount of payback) If I stick £1000 in my savings it will make about £3 per month after tax. If I have an offset mortgage then my savings will make an equivalent £5 per month To me it is a no brainer!

Borrowing on a mortgage is access to the cheapest money you can find in this country, house prices currently are just about neck and neck with wages so are not going to be effectively any cheaper to you as time goes on, you need to save a skip full of money to make any really big difference to your mortgage payments, in effect you are beavering away on your savings for about £2 per thousand per month, that to my way of thinking is a crazy way to do it - Such a small amount of gain would be wiped out by a miniscule rise in house prices - Remember that house prices are not really falling - they are rising more slowly.

Buy land - They have stopped making it you know!

Just to stir up the embers a bit.

http://uk.news.yahoo.com/03092005/344/investment-property-sees-growth.html

weekendwarrior

Hi everyone,

Unfortunately estate agents are in denial!

I put one of my houses on the market last December, it is in Southport and was valued at £185,000. The house is a 4 bedroom semi detached, three storeys high.

I sold the house last week for £145,000. It was costing me around £1000 per month to keep it so I just wanted to get shut asap. Believe me the housing market is DEAD at the moment.

People that think they are getting a bargain by knocking £10000 of the asking price are not as 5 years ago they could of got the property at less than half the price it is now.

It was quite amusing to visit the estate agents in Blackpool, where some sellers had reduced their houses from £140,000 to £139,000, as if a mere £1000 is going to make any difference. Wish I could have shown them that a real reduction would be more like reducing a £140,000 house to £110,000. I suppose it is different if you are living in the house but I feel house prices will fall significantly this year and may continue for a few years. I'll be holding on to my money and waiting a while before buying another house for sure!

Ian_W

$$$ wrote: Personally speaking as a FTB I'm happy to wait and see. I don't need a house right now, my rent is pretty cheap (less than half what I'd pay for a mortgage) and I'm a bit worried about the economy (so would prefer to have some spare cash rather than a big debt if my job ends up disappearing).

That and your supporting arguments are the most sensible I've seen on these threads for not buying at the present. Clearly, worse than being a doomster wannabe who can't buy because of job insecurity, even *when* prices drop, is being a "just have" who can't pay their mortgage, who lose their home and are saddled with huge long term debt. You may be right and your decision will be vindicated, you may be wrong and after a little turbulance the economy may recover and house prices start to rise again. There are no absolutes, it's a personal choice and if it doesn't feel right for you at present then it isn't - end of story.

Mr Proctalgia wrote: I can borrow a thousand pounds for about £5 per month (and that would include a tiny tiny amount of payback) If I stick £1000 in my savings it will make about £3 per month after tax. If I have an offset mortgage then my savings will make an equivalent £5 per month To me it is a no brainer!

Well said, Mr P, but it won't please the numpty's who post how expensive mortgages are, not realising how foolish the statement is when mortgages [with the very odd exception] are the cheapest form of credit available to most people. It never ceases to amaze me that unfavourable comparisons are made between houses and the stock market as investments. It's a Wayne's World comparison - how many people could borrow 90% of a substantial investment, at the lowest rates of interest, and keep 100% of any gains, tax free? Lots of people do with their homes, very few could with the Stock Market, if they wanted to. No brainer and a half to me too!!

meanmachine_2

Ian_W wrote:

It's a Wayne's World comparison - how many people could borrow 90% of a substantial investment, at the lowest rates of interest, and keep 100% of any gains, tax free? Lots of people do with their homes, very few could with the Stock Market, if they wanted to. No brainer and a half to me too!!

No brain indeed.

The last time I checked, homes aren't cash machines, but places to live in.

Therefore you don't make any profit out of it, unless you sell and live on a cloud somewhere.

And aren't you one of these people who keeps banging on about how people should stop seeing homes as an investment? Which is it now? I'm confused.

I'm afraid it's that kind of thinking which has lead to record levels of MEWing to buy those f-ing great 4WDs.

meanmachine_2

Ian_W wrote:

Clearly, worse than being a doomster wannabe

A doomster is the sort of person who predicts fire, war and pestilence.

It's not someone who would like to see housing become affordable again.

There's nothing more doom-laden than the prospect of property sucking so much money out of the economy and into the pockets of lenders for the ext 25 years.

There's no-one more of a doom mongerer than those 20 year old estate agents who try to scare FTBers into buying before they "miss the boat" forever.

In fact, the ONLY people who see a housing correction as bad are the Estate Agents as they lose commission.

Ready to come clean at last IanW?

meanmachine_2

[QUOTE=Mr ProctalgiaBuy land - They have stopped making it you know!

[/QUOTE]

this last comment made me laugh.

Prey tell me how much land is currently "developed".

I think it's around 7%.

Quick!!!! Hurry!!!! You must buy before the other 93% is gobbled up!!!!

Look at Japan - tiny country and yet house prices have only....oh, er gone down in the last 10 years.

Ian_W

Meanmachine wrote: Ready to come clean at last IanW?

Watch my lips meanmachine, I am NOT a ferkin estate agent!!
There - said it, happy now?
Does everyone you disagree with have to be an EA or a vested interest? Just cos you're paranoid - doesn't mean they're not out get you, eh?
It can be well controlled, I'm told, with the right treatment.

Meanmachine wrote: And aren't you one of these people who keeps banging on about how people should stop seeing homes as an investment? Which is it now? I'm confused.

Don't think so, I view them as a bit of both - a home that can also be a good long term investment. I've used equity in the past for home improvements, prop abroad, new 4x4 etc and will do in the future if the need arises.
Confused? You can get pills for that as well.

Kenny4315

When I say cash is king, it surely is when your talking about buying houses, if I go to buy a house and say the money in the bank we can complete in 2 weeks, I'd expect to get a very generous discount off the price, at least 10% and even more on more expensive properties. Alternatively go to buy a house and say well its like this I have to arrange a mortgage, and need to sell my own house, blah blah, blah the seller probably won't accept much of a reduction/won't take an offer until your in a position to really get down to business.

There are plenty of muppets who have overstretched there finances out there, who will have to sell / get repo'd, some of the recent surveys have illustrated repos going up. For example, there are a substantial amount of BTL people (especially novices) who won't be able to keep things running if there is no capital gain, as those who have bought recently are not making any cash, once you take into account mortgage payments/Un-occupancy/fees/Insurance/etc. I had a few BTL properties which I sold recently because it was easier and more profitable selling up and putting the cash in the bank/FTSE/ etc. Note also the FTSE is making significant gains now not dropping like a stone as was the case 4 years ago when the bubble started.

As usual the boom in the UK has been fuelled by speculation, there is absolutely no reasons for prices to go up by over 100% in 5 years. The population has not shifted significantly, there are more houses/appartments than ever before/etc. The reason why is everyone has panicked and many large scale investors have been trying to make a quick buck from houses rather than from stocks and shares.

Surely everyone's aim is to pay off the mortgage asap, I paid mine off by the time I was 34, in 5 years from the mortgage start. It your biggest ball and chain you'll ever have so surely it best to off-load it asap, saving yourself a fortune in interest charges. The reason why most don't lately is because they release 'equity' to buy stuff to keep up with the jones. I only need to look at the car park at my gym to see that, a miriad of 4x4, sport cars, etc, paid over 25 years by re-mortgaging on the basis of current house prices. Start talking about NET ASSETS and these posers suddenly are in big trouble if the market crashes, negative equity, wasting assets (such as cars, etc). As for investments overseas, the market overseas has been mainly fuelled by UK buyers in places like Spain, Turkey, etc. If the UK market crashes then these markets will also find it very difficult, as they can only sell to the british often. For example, my wife is Turkish, the villas on sale have several prices, the Turkish is considerably less than the GBP/EURO price. It would be impossible for a regular Turkish national to pay £80k for a 2 bed villa, as the average wage is about £6k pa.

I am overjoyed to see that so many people still have not realised the market is heading downwards. It is exactly the same as the last house price crash and those before it, and the same as the recent stock market crash. When people are so blinkered that they can't see things have got out of hand then that is when things do drop like a stone. People will say its different this time but it isn't, prices are too high and thus must drop, its very simply. :T

Kenny4315

Doozergirl wrote:

2) In the very near future (his words), or in six months time (yours), Kenny will not be rushing around York picking up houses formally advertised at half a million for tuppence. It just doesn't work like that. Nothing to do with refuting anyone elses prediction of a fall in prices.
.

I reckon I'll be able to get one originally marketed for over £500k close to or below £400k though !! That's alot of money, even for a moneysaver forum. Plus the reduction in stamp duty/legal fees/etc. :j

Kenny4315

Ian_W wrote:

Doomsters ask yourself - how safe's your job - don't answer, SAFE AS HOUSES!! :rotfl:

I'm semi-retired (ie I don't need to work again unless I have the buring desire too, which at present I haven't), so it ain't going to worry me. Maybe I'll invest in property, once it crashes of course. :rotfl: