Renting vs buying in 2017

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  • qwert_yuiop
    qwert_yuiop Posts: 3,615 Forumite
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    edited 2 October 2017 at 2:42PM
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    Well whether buying a house is a good idea or not, it has to be accepted that our experience of the property market is somewhat different from what the English are accustomed to. Fifty percent drop in a couple of years? Imagine the howls if that were to happen in London. Who knows, it might. Who knows, can you think of any reason why it mightn't happen again here?

    Simplistic advice like the above led to disaster and regret for many in the run up to 2007.

    I was over in London last week, and all the talk was of prices dropping. Having lived through our boom and bust, I'd say a prospective buyer there should be cautious. I can think of few reasons to spend £50,000 more than you need to. In fact, I can't think of any.
    “What means that trump?” Timon of Athens by William Shakespeare
  • andrewf75
    andrewf75 Posts: 10,421 Forumite
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    motorguy wrote: »
    You would think so, but not on this thread / board it isnt. :)

    ah, the dangers of responding to a thread in a part of the forum you don't usually inhabit!
  • andrewf75
    andrewf75 Posts: 10,421 Forumite
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    qwert_yuiop wrote: »
    Simplistic advice like the above led to disaster and regret for many in the run up to 2007.

    only if you buy for short term investment. I was under the impression the poster wanted somewhere to live. In which case it doesn't really matter whether prices go down, they will likely rise in the long term and even if they don't the point is you own the property once you've paid off the mortgage!
  • qwert_yuiop
    qwert_yuiop Posts: 3,615 Forumite
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    edited 2 October 2017 at 3:36PM
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    andrewf75 wrote: »
    only if you buy for short term investment. I was under the impression the poster wanted somewhere to live. In which case it doesn't really matter whether prices go down, they will likely rise in the long term and even if they don't the point is you own the property once you've paid off the mortgage!

    Well, yes, but... property prices halved after 2007 in Northern Ireland. Anyone Ill advised enough to have bought the day before the crash ( I'm sure there was one) is now ten years into a mortgage for a house they paid twice as much for as they could have if they had waited a couple of years. Prices have risen a little in that full decade, but only a little, and are nowhere near the levels of 2007. These buyers are reminded of this every month when they pay twice as much every month as someone next door who bought a couple of years later.
    It was a bad buy in 2007, it's still a bad buy.
    Our experience is radically different from yours - so far. Once the idea becomes pervasive that prices are dropping, people stop buying. This of course causes prices to drop further, since a seller will only be able to generate interest if the price looks like a bargain. A crash therefore generates.. a crash.
    Nobody knows, it may be a false alarm or it may be a meltdown developing, but soft landings are a fantasy.
    “What means that trump?” Timon of Athens by William Shakespeare
  • motorguy
    motorguy Posts: 22,473 Forumite
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    qwert_yuiop wrote: »
    Well, yes, but... property prices halved after 2007 in Northern Ireland. Anyone Ill advised enough to have bought the day before the crash ( I'm sure there was one) is now ten years into a mortgage for a house they paid twice as much for as they could have if they had waited a couple of years. Prices have risen a little in that full decade, but only a little, and are nowhere near the levels of 2007. These buyers are reminded of this every month when they pay twice as much every month as someone next door who bought a couple of years later.
    It was a bad buy in 2007, it's still a bad buy.
    Our experience is radically different from yours - so far. Once the idea becomes pervasive that prices are dropping, people stop buying. This of course causes prices to drop further, since a seller will only be able to generate interest if the price looks like a bargain. A crash therefore generates.. a crash.
    Nobody knows, it may be a false alarm or it may be a meltdown developing, but soft landings are a fantasy.

    We had the hard landing 10 years ago. Prices are quite literally still a fraction of what they were then.

    If someone wants a home - rather than an investment that they need to go up in value - buy, pay it off over whatever mortgage term you can afford, and relax and enjoy your purchase. :beer:
  • motorguy
    motorguy Posts: 22,473 Forumite
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    andrewf75 wrote: »
    only if you buy for short term investment. I was under the impression the poster wanted somewhere to live. In which case it doesn't really matter whether prices go down, they will likely rise in the long term and even if they don't the point is you own the property once you've paid off the mortgage!

    Indeed, however several on this forum are extremely risk averse.
  • qwert_yuiop
    qwert_yuiop Posts: 3,615 Forumite
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    It's been said before, but all you can say with certainty is it's a better time to buy now than it was then. It's not the sure fire winner promoted by the earlier poster.
    “What means that trump?” Timon of Athens by William Shakespeare
  • motorguy
    motorguy Posts: 22,473 Forumite
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    edited 2 October 2017 at 5:06PM
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    qwert_yuiop wrote: »
    It's been said before, but all you can say with certainty is it's a better time to buy now than it was then. It's not the sure fire winner promoted by the earlier poster.

    ** It doesnt matter **

    Buy at a price you're happy with, and pay it off. Prices are just over half what they were at the peak, have risen roughly 4% per year this past 5 years.

    You're never going to get a Sign From God that you should buy now and that He will make sure prices will only ever go up. :eek:
  • qwert_yuiop
    qwert_yuiop Posts: 3,615 Forumite
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    motorguy wrote: »
    Indeed, however several on this forum are extremely risk averse.

    I wonder what the reason for that could be? Something to do with the experience of the last decade in the property market, I'd say. Once bitten etc.
    I bought a few years back (post crash) because I wanted the property. What's it worth? Whatever someone will pay for it. Could be more, could be less than I paid for it.
    “What means that trump?” Timon of Athens by William Shakespeare
  • qwert_yuiop
    qwert_yuiop Posts: 3,615 Forumite
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    motorguy wrote: »
    ** It doesnt matter **

    Buy at a price you're happy with, and pay it off. Prices are just over half what they were at the peak, have risen roughly 4% per year this past 5 years.

    You're never going to get a Sign From God that you should buy now and that He will make sure prices will only ever go up. :eek:

    The other poster believes it's always a good time to buy. Must be an estate agent.

    And of course it matters.
    “What means that trump?” Timon of Athens by William Shakespeare
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