Just been out bid for a house!

HankMcSpank

Hugh_Mann wrote: »

Luckily i have had a offer accepted on a property for 8% below its current market value this gives me a little head room if this crash ever comes.

Ahem - that isn't headroom....all you've gone & done is simply set the latest 'market price' for that style of house in that particular road!

It's not like the seller is going "Ok, I could actually raise X for it, but I'll sell it to Hugh_Mann for X less 8%" ....he's obviously weighed up his options and figured your offer represents the best he can raise. That makes your offer the current market price.

Also, remember there's total price transparency nowadays at the click of a mouse - so the next guy looking at the next house up for sale in your road will want 8% off the price he can see you paid...(to build in some 'headroom'!) - then guess what....you're sitting on a 8% loss + frictional costs (Stamp Duty, legal fees etc)

IveSeenTheLight

!!!!!!? wrote: »

Easy credit allowed people to get into the BTL game (the 'amateurs')

And essentially also FTBers.

With credit becoming more controlled again (hence why you foresee BTL's will be less in the future), what makes you think that FTBers will be able to afford more than BTLers?

Generali

IveSeenTheLight wrote: »

And essentially also FTBers.

With credit becoming more controlled again (hence why you foresee BTL's will be less in the future), what makes you think that FTBers will be able to afford more than BTLers?

At present it looks likely to be the case that FTBers will be in a stronger position than BTLers as it appears that the easiest terms available on BTL mortgages (75% LTV, 125% rental cover) are a lot more stringent than that available to FTBers.

Personally, in a falling market I'd be happier lending to a OO than an investor as an OO is less likely to walk away from their home if they're losing money.

In a rising market an investor might be a better bet as you have the security of a 2nd property you can at least get a charge against and an investor is less likely to return the keys to you with a "It's your problem now" note if they think they're going to get rich.

IveSeenTheLight

Generali wrote: »

At present it looks likely to be the case that FTBers will be in a stronger position than BTLers as it appears that the easiest terms available on BTL mortgages (75% LTV, 125% rental cover) are a lot more stringent than that available to FTBers.

Personally, in a falling market I'd be happier lending to a OO than an investor as an OO is less likely to walk away from their home if they're losing money.

In a rising market an investor might be a better bet as you have the security of a 2nd property you can at least get a charge against and an investor is less likely to return the keys to you with a "It's your problem now" note if they think they're going to get rich.

75% LTV although more than a FTB requirement of 90% LTV may not really affect the affordability.
BTL LL's tend (should) be more established and have more available cash for a deposit.
125% rental cover has been a requirement for a while. this is actually quite a good limiter in evaluating whether the property is a viable rental property.

You think that it is safer to lend to an OO in a falling market than to a BTL LL. By your previous statement it would be safer to a BL LL as they are puting a larger deposit down. Having a larger deposit (the lower LTV) is surely safer in a falling market