A question for potential FTB's

spottydog

kinesin wrote:

Even Estate Agents :eek: are predicting no recovery til 2008 with prices dropping 9.1% this year and 10.3% till the end of 2006.

Just clicked on the link and what it actually says is Estate Agent REVENUE will drop by those figures not house prices!!

Given that figures shows sales volumes are closer to 50% of 2004 and estate agents say revenue is going to only drop by less than 10% then revenue per property must be rising dramatically so as far as I can see either Estate Agents are increasing the percentage they charge or actual sale prices are increasing.

lush_walrus

Im not going to get drawn into a discussion about house prices again, but the one thing I will say is that ALL threads seem to end this way with majority of people reporting what they have read in this article or that, the majority of people predicting anywhere from stagnant prices to huge falls in the next few years etc etc.

The point Im trying to make is that all of this is incredibly samey now one thread is the same as the next!, wasnt the original point of the thread to ask WHY ftb's buy in what is thought to be a peak in the market. More interesting don't you think than quoting this that and the other?

madfrenchgirl

ye i agree with you... i am planning on buying a house in the next 2 years but not right now, just simply because not enough deposit for a decent mortgage

summerday

We were FTBs a year ago. We were both living with parents and really wanted our own space. Between us we had saved up a pretty decent deposit, and although house prices in our area had risen a lot over the last few years we have reasonable incomes and only had to borrow just over 2.5x joint incomes. Some people were saying to us we shouldn't buy, we should rent a while as prices may drop in a year or 2. But as we had a decent deposit and weren't overstretching ourselves we went ahead and bought. To rent a similar house to the one we bought would have cost £525 ish a month so prices would have had to drop at least £6k over the past year for it to have been worth us renting instead of buying, and incidentally in our town prices haven't dropped (yet anyway) though they have levelled off, so I'm glad I hadn't listened to those people then.

Also I love decorating and making home improvements and I'd have hated living somewhere we couldn't do what we liked to- but then again even if a landlord said we could decorate and make improvements what would have ben the point, we would be spending our own money and possibly improving the value of the house for their benefit. Whereas this year we've redone the kitchen, bathroom and garden that will hopefully make a small impact on the value of our home.

I can also identify with other posters who say they have rented and had to move on several times. I have friends who rent and even when landlords have said they have no intention of selling in the foreseeable future have turned round 6 months later and given their notice. I find moving quite stressful and plan to live in our current house at least 5-6 years more, I would hate to be told by landlords every 1-2 years that we have to pack up and move on.

I am not criticising anyone else for what they choose to do, I am just responding to the OP on why people would choose to be FTB's.

Joannaclaire

In answer to the question. We are FTBs and are hoping to buy still, in spite of the current market and predictions of a downturn.

We are both in our thirties, live in greater London and are currently renting a 2 bed flat and have been renting for years now. We want our 'own' 3 bed house as we hope to have a family some day soon and are also sick of living in a flat with noisy neighbours thundering up and down the stairs and having domestics without consideration to the lack of soundproofing in our building. We're also sick of not being able to decorate/buy nice furniture as it isn't our own property and there's no point in getting sofas etc if they won't fit into a new property. So at the moment we feel our life is a bit on hold until we get our own place. Also, the amount we wish to borrow would mean our actual mortgage would be aprox 2/3 of the current amount we are paying in rent. So we'd be saving a couple of hundred pounds a month, which we of course will then use to overpay or offset our mortgage with - or buy nice furniture with ;-)

We are however in a unique position as we have a rather large deposit, thanks to some early inheritance and also our savings (so has no shiny wide screen telly, no trendy clothes, no big holidays etc for the past five plus years).

We look at our future house as being a home, rather than an investment and also as we both freelance and work from home, it will be a workspace too. Even if property values drop we feel because we'll have less of a mortgge, this hopefully will have less of an impact on us when and if we come to sell.

But so far we have been looking for 12 months as we don't want to rush into anything (and it's amazing the number of badly located, small, dark, north-facing properties on main roads that EAs keep trying to show us) as we don't intend on moving for a few years once we have bought, so whatever we buy has to tick most of the boxes and also be reasonably priced to boot. Thus far we have been gazumped once, and missed out to higher bidders several times as we refuse to pay over the odds given we are in a good position. We are optimistic our house is out there and can't wait to move and get on with our lives :-)

purple12

I think what I'm saying is similar to what other people have written but I'm a first time buyer looking to buy now (through one of the keyworker schemes so it is a part of a property rather than the entire cost) mainly because I just want somewhere to live that isn't dependent on what my landlord does. I've had to move a couple of times because my landlord wanted to sell or renovate and I just want to be somewhere where I don't have to worry about that anymore.

I can afford the mortgage (will be no different from the rent I'm paying at the moment) - and I could afford it if the mortgage goes up too and to be honest, the thought of not needing to move in the immediate future outweighs the investment thing.

I am looking on buying a flat as paying rent to the bank instead of a landlord - I never really thought of renting as dead money because we all need somewhere to live and if the price of the property goes down, so be it, as long as I can afford the mortgage it'll work for me. I might lose thousands of pounds by buying now, but I don't want to go through another move and forever be accumulating bits and pieces of furniture - thinking about where i am going to have to move next and whether my things will fit into the next flat.

wibble68_2

Pal wrote:

In addition, if you have bought and ended up with, say, £10k negative equity, you are going to have major problems moving house and gettting the mortgage on the other property without a deposit to put down.

Personally I think that the only people who should buy at the moment are those with massive deposits who are not worried about losing it if house prices fall i.e. they are going to stay where they are for a long time.

A bit of sense at last.

I wish people would stop banging on about this mythical boat that's just set sail.

Encouraging people to buy in an overvalued market is not good advice.

It's only a good time to buy for certain people.

For the majority of people it's not a good time to buy.

socks_uk

If FTBs are buying a house as a long term home rather than an investment then the right time for THEM must be when THEY can afford it?

We all know what happened in the eighties with people having negative equity on their property but how many of those people still have negative equity now?? None I would say.

No-one knows what the future holds but there's one thing I'm sure about... I'm getting older, wiser and I ache more! Now is the right time for me to move and I'm biting the bullet and going for it.

Jill

John_M_Business

FaTB wrote:

I think that was a fairly balanced statement, many think the market will stagnate,

First part true... most have observed that the current market has stagnated in places... however there is more activity after the interest rate drop in August than for some months...

FaTB wrote:

and many are predicting larger drops than I suggested.

Second part not... I haven't seen any reports from what would be considered reputable media indicating this. In fact, the only place I can see these alleged predictions are on boards like this or websites developed to talk down the market. There is a HUGE difference between stagnation and 25% drops.

FaTB wrote:

But I do not hear anybody saying that prices are rising or are going to start booming again!!

Wake up times have changed, the boom is well and truly OVER.

The boom has settled, true. House prices have reached a new plateau, but it is possible that they will start rising when they make their next move. It may be a year or so before this occurs... we shall see...

Rave

John_M_Business wrote:

Er... yes. Why not start a discussion thread with an unbiased, level headed, considered statement...

Come again???!! 25-30% in your dreams.

What, so 'in your dreams' is considered and level headed?:rolleyes: He presented 25-30% as a worst case scenario, not as the most likely. If you think that it would be impossible for prices to drop 25% over the next few years then I'm afraid it's you who is living in a dream world- it has happened numerous times in the past, and it can definitely happen again. That's not to say that it will, or that it's even particularly likely, but to not even acknowledge the possibility strikes me as extremely foolhardy.