My wife is desperate for her own house but..

eurows · 24 June 2005 at 11:44AM

My wife is desperate for her own house as we are renting at the moment. However I really feel we are in for a crash of some sorts. All the signs are there. EA we talk to are now having a difficult time. One I spoke to in Huddersfield now has 220 properties on their books compared to only 40 at this time last year. They told me that on avaerage people are offering 10% less than the asking price.

However I feel that if I buy now I will be top of the loser list. Buying at peak prices with a expensive mortgage. Surely anyone buying now unless they have a big deposit from the sale of their last house are going to be one of those negative, stuck, depressed majority that the newspapers and TV will be talking about next year.

I feel holding on and putting up with my wife moaning every day is going to pay off in the long run. In fact she will probably thank me next year.

Anyone else got the same problem.

rach83 · 24 June 2005 at 11:57AM

I think you have to take a bit of a view on this. At the end of the day the market goes up and down. As long as you do not pay too much for the property you may have to sit tight for a while but being on the property ladder has to be better than paying rent which is just dead money. I am an estate agent and yes people are panicking. I think what you have to remember is that houses are stabilising. Interest rates are still relativity low in comparison to the late 80's when the market did crash. The key is getting a good deal on your purchase - remember if you are first time buyers and are in a strong proceedable position. Haggle and haggle more DO NOT BE AFRAID OF MAKING OFFERS even if they are percieved to be low alot of sellers are still trying to over price.

Good Luck

Fairdo_2 · 24 June 2005 at 12:22PM

As rach83 said, you have to take a view on this.

I traded upwards last year with all of this talk of house price crash, but I am confident that prices will ultimately take an upward trend through time. However, prices can drop cyclically and short term, I would be a bit concerned. However, if you want tobuy to stay for some time, I would take a view that the risk is lower.

I cannot predict the future, but I personally would be happier joining the property ladder than throwing my money to the wall with rent if I had the choice.

If you are uncomfortable with commiting to the property ladder, you have every right to your views and to stick by them. Ultimately it is your choice.

A different view on this is that during un ancertain market, as a First Time proceedable buyer, you are in a position to negotiate a good deal for yourself, so if you do buy, make sure you pay what you feel comfortable and no more.

meanmachine_2 · 24 June 2005 at 12:35PM

rach83 wrote:

I think you have to take a bit of a view on this. At the end of the day the market goes up and down. As long as you do not pay too much for the property you may have to sit tight for a while but being on the property ladder has to be better than paying rent which is just dead money. I am an estate agent and yes people are panicking. I think what you have to remember is that houses are stabilising. Interest rates are still relativity low in comparison to the late 80's when the market did crash. Good Luck

Aaaarrrrgh!

How many inaccuracies can one post contain?

In a stabilising market renting is NOT dead money.

When has the housing market in this country ever "stabilised"?

Real interest rates - as opposed to nominal rates - are the SAME as they were in the 80s.

If you have a large debt (ie a mortgage) it is MUCH better to have a high inflation high interest rate economy than a low inflation economy.

Etc etc etc

It really is true that, to be an estate agent you don't need ANY qualifications. Although even a basic grasp of economics would be quite handy.

To the OP I'd say that, if the issue is causing you personal problems, then buy. But if the market does crash, how will you feel then? If the answer is thaty you won't be bothered, then buy.

Some things are too precious for money to spoil.

kamaran · 24 June 2005 at 12:40PM

meanmachine wrote:

Some things are too precious for money to spoil.

Thats what it should come down to mate.

YorkshireBoy · 24 June 2005 at 12:53PM

eurows wrote:

One I spoke to in Huddersfield now has 220 properties on their books compared to only 40 at this time last year. They told me that on avaerage people are offering 10% less than the asking price.

Anyone else got the same problem.

Don't think so! Where we are in HD9, a 3 bed semi has just gone on the market at £225K, which is a 59% premium on the £142K the current owners paid just two and a half years ago in December 2003.

And guess what?...3 days later - an offer made for the FULL ASKING PRICE!!!

On the plus side, with a 3 bed detatched, I'm now a net 1/4 millionnaire (even after mortgage owed) - on paper anyway.

On the down side, my kids will never be able to afford to buy a house anywhere near us!!!

When will this madness end?

albreda · 24 June 2005 at 1:00PM

I live in Edinburgh and we went a 1 bedroom flat. It's a good sized room and the living room / kithen is also very nicely sized. There is a small bathroom and a small hall way. So effectively its a a couple of rooms....

This would cost around £95,000 to £110,000 to buy. There are two problems I have with mortgages;

1. We might get a 25-30 year mortgage for £100,000 but you'd actually payback nearly double that with interest.

2. That's about £50,000 per room!! How can people justify that?!?!

I'm now 29 years old and my partner is 24. A 30 year mortgage would make us 59 and 54 by the time the mortgage was paid (in the unlikely event we didn't move). Given that life expectancy for men is about 72 or 74 years old, and that so many people have to sell to pay for their old age or old peoples home accomadation, where's the incentive? Seemingly it's no longer the case that a mortage is cheaper per month than rent either.

And with all the associated costs like buildings insurance and the various repairs etc, it just doesnt offer me any kind of reason to want to buy.

Does anyone else feel this?

Joe

vale_2 · 24 June 2005 at 1:06PM

Us brits are obsessed with owning our own homes...other europeans thinks we are mad...dont know the answer but it keeps me in a job!!

albreda · 24 June 2005 at 1:14PM

Perhaps I'm a closet-Frenchman...

Edinburgh is a renters market - there are hundreds of places available for rent. We move'd up here from Great Yarmouth at the drop of a hat. We simply gave a months notice at out last flat and up we came. Renting leaves me feeling much more mobile.

Am I wrong thinking like that? I should I believe the estate agents?

eurows · 24 June 2005 at 1:21PM

On the plus side, with a 3 bed detatched, I'm now a net 1/4 millionnaire (even after mortgage owed) - on paper anyway.

I take it if they fall 30% your knackered

eurows · 24 June 2005 at 1:28PM

There must be loads of 1/4 millionaires. In fact anybody who has a house outside of Bradford.

The clever ones will be those that still have it in three years time sunning themselves up on a desert Island.

The rest will be here again talking about the good ol days.

My wife is desperate for her own house but..

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