Terrible time to buy a house?

[Neil H]

daytona365 said:

We don't, don't, don't want millions more crappy houses being built.......I'm quite happy in the house I've got. Like to visit open countryside now and again.

No, what we need in this country is less NIMBYism and an openness to development. People like to complain about house prices but any suggestion of building more houses is met with “not here, not there, not over there, you can’t do that here, that will ruin the character of our village” etc etc ad nauseum. When there’s such resistance to development, what do you expect?

[okgo]

Often those people have a point.

Why ruin a pleasant Surrey village when you could just extend Redhill a bit

[youngsyr]

okgo said:

Often those people have a point.

Why ruin a pleasant Surrey village when you could just extend Redhill a bit

Agreed, they do have a point in most cases - why make our towns and villages even more crowded and congested when there's plenty of space elsewhere to put millions of homes?

It's not as if the developers are building nice, affordable, generously spaced family homes with plenty of parking in areas with good transport links - they're cramming in as many units as feasibly possible into areas that weren't designed to house that many people, with the inevitable impact on local congestion, crammed commuter trains and general loss in standard of living.

Still, as long as they make a few quid though, eh?

[Neil H]

It depends on the availability of the land among other things. It's not usually a case of them saying "right this is the best place, so we'll build here" - there will be a multitude of factors to consider.

It’s not just in quiet little villages though. I’m in the suburbs of SE London/ Kent and a recent proposal to replace a couple of ugly 1970s blocks of flats with 4 slightly larger blocks (effectively double the number of flats) is being met with resistance from locals. This is 5 minutes walk from a major rail station/ town centre. People become very selfish once they’ve got what they want and will resist absolutely every form of development in their locality – particularly the older generation.

[youngsyr]

Neil H said:

It depends on the availability of the land among other things. It's not usually a case of them saying "right this is the best place, so we'll build here" - there will be a multitude of factors to consider.

It’s not just in quiet little villages though. I’m in the suburbs of SE London/ Kent and a recent proposal to replace a couple of ugly 1970s blocks of flats with 4 slightly larger blocks (effectively double the number of flats) is being met with resistance from locals. This is 5 minutes walk from a major rail station/ town centre. People become very selfish once they’ve got what they want and will resist absolutely every form of development in their locality – particularly the older generation.

Let's not kid anyone though - the primary factor in every developer's thought process is profit margin.

What we need is a government led initiative to build a substantial amount of homes with a true focus on what's best for the country. The private sector developers will have to do the leg work, but it needs someone without a vested interest to oversee the project(s).

[daytona365]

In London and the south east there's no bad time to buy a house.

[numtumfutunch]

daytona365 said:

In London and the south east there's no bad time to buy a house.

The woman I used to work with who bought a bedsit in Docklands in the mid 90's and was still in negative equity and unable to move several years later may well disagree with you

[Thankyou4calling]

numtumfutunch said:

The woman I used to work with who bought a bedsit in Docklands in the mid 90's and was still in negative equity and unable to move several years later may well disagree with you

As would I.

Bought a lovely two bed flat in Brockley SE4 in 1990 for £72,000. Sold it after the market had recovered in 2000 for ..........£72,000.

At any time between I was well into negative equity.

[numtumfutunch]

Thankyou4calling said:

As would I.

Bought a lovely two bed flat in Brockley SE4 in 1990 for £72,000. Sold it after the market had recovered in 2000 for ..........£72,000.

At any time between I was well into negative equity.

Quite

I wonder what the demographic is on this board as nobody else seems to know anything other than a bull market for housing

Im not old by any means but remember this vividly as much as I remember coming to work in 1989 with my colleague sobbing that her mortgage rate had hit 15% which she couldnt afford

Cheers

[Neil H]

Thankyou4calling said:

numtumfutunch said:

The woman I used to work with who bought a bedsit in Docklands in the mid 90's and was still in negative equity and unable to move several years later may well disagree with you

As would I.

Bought a lovely two bed flat in Brockley SE4 in 1990 for £72,000. Sold it after the market had recovered in 2000 for ..........£72,000.

At any time between I was well into negative equity.

If you kept it until now you'd be sitting on a couple of hundred grand profit, and probably have paid the mortgage off. So the real issue is how long you are prepared to potentially stay in the property.

My brother had a 2 bed flat in Fulham bought in 2000, he paid 175k for it and sold a few years later for 245k - it has recently just sold for 675k.

[W124]

The question is... "Is this a terrible time time to buy a house?" Not "Is the general trend in house prices going to be upward over a long period of time?" That's the thing. We know interest rates are, on balance, likely to go up in the near future. Clearly the stage is being set for that. They haven't gone up for many years. None of us know what will happen to this wildly over-stretched market when they do. We don't know what the sentiment is going to be and we don't know the affect that sentiment is going to have on the relationship between supply and demand. Therefore, IMHO, it IS a terrible time to buy, inasmuch as if there were going to be utterly irrational stampede out of the market, then it is going to happen when rates rise. Ergo - after rates go up and the effect can be understood and factored in would be a better time.

My own humble view is that it is going to be a bloodbath. That's not based on flailing about in data and using the word 'portfolio' a lot. It's just a gut feeling.

[daytona365]

Thankyou4calling said:

As would I.

Bought a lovely two bed flat in Brockley SE4 in 1990 for £72,000. Sold it after the market had recovered in 2000 for ..........£72,000.

At any time between I was well into negative equity.

.......So how much is it worth now then, 250,000 ?

[Thankyou4calling]

daytona365 said:

......So how much is it worth now then, 250,000 ?

I thought it might be around that.

Looked about 3 or 4 months ago and whilst the exact flat wasn't for sale there were others essentially the same. Two bed Victorian house conversion. It was on a regular residential road, Howson Road 10 minutes walk from Brockley Station. Being top floor I had no garden.

The same now sells for in excess of £425,000 and are advertised at £450,000!

It really is mad because although it was a nice flat and had decent communication links it was far from what you'd call a nice area, just a pretty normal place, the sort a FTB would go for as I did.

This is in the parallel road, same layout and type

http://www.rightmove.co.uk/property-for-sale/prope...

How I wish I'd kept it :-(

Edited by Thankyou4calling on Sunday 2nd August 21:18

[okgo]

numtumfutunch said:

Quite

I wonder what the demographic is on this board as nobody else seems to know anything other than a bull market for housing

Im not old by any means but remember this vividly as much as I remember coming to work in 1989 with my colleague sobbing that her mortgage rate had hit 15% which she couldnt afford

Cheers

it is bull, look at a chart

[davepoth]

Look at another chart and you'll see that average house prices are now over 5 times earnings, against a long term average of 4.1. They got up around 5.75 just before the crash in 2007, and dropped to around 3.25 in the mid 90s. That bears little relevance to the housing shortfall.

[sooperscoop]

W124 said:

My own humble view is that it is going to be a bloodbath. That's not based on flailing about in data and using the word 'portfolio' a lot. It's just a gut feeling.

Interest rates aren't going up significantly, IMHO. I think we'll be looking at sub 3% until 2020, maybe 2025. And this is regardless of inflation.

What better way to burn through all of that government debt and QE than a low interest rate/medium inflation rate environment?

[Welshbeef]

W124 said:

The question is... "Is this a terrible time time to buy a house?" Not "Is the general trend in house prices going to be upward over a long period of time?" That's the thing. We know interest rates are, on balance, likely to go up in the near future. Clearly the stage is being set for that. They haven't gone up for many years. None of us know what will happen to this wildly over-stretched market when they do. We don't know what the sentiment is going to be and we don't know the affect that sentiment is going to have on the relationship between supply and demand. Therefore, IMHO, it IS a terrible time to buy, inasmuch as if there were going to be utterly irrational stampede out of the market, then it is going to happen when rates rise. Ergo - after rates go up and the effect can be understood and factored in would be a better time.

My own humble view is that it is going to be a bloodbath. That's not based on flailing about in data and using the word 'portfolio' a lot. It's just a gut feeling.

If that's your belief have you sold up all real estate and now renting and ready to pounce on the much lower prices a bloodbath would create? If not you don't really believe it do you.

[turbobloke]

Welshbeef said:

W124 said:

The question is... "Is this a terrible time time to buy a house?" Not "Is the general trend in house prices going to be upward over a long period of time?" That's the thing. We know interest rates are, on balance, likely to go up in the near future. Clearly the stage is being set for that. They haven't gone up for many years. None of us know what will happen to this wildly over-stretched market when they do. We don't know what the sentiment is going to be and we don't know the affect that sentiment is going to have on the relationship between supply and demand. Therefore, IMHO, it IS a terrible time to buy, inasmuch as if there were going to be utterly irrational stampede out of the market, then it is going to happen when rates rise. Ergo - after rates go up and the effect can be understood and factored in would be a better time.

My own humble view is that it is going to be a bloodbath. That's not based on flailing about in data and using the word 'portfolio' a lot. It's just a gut feeling.

If that's your belief have you sold up all real estate and now renting and ready to pounce on the much lower prices a bloodbath would create? If not you don't really believe it do you.

It's not my view, but if it happens then there'll be some tasty cash-buy opportunities.

'always look on the bright side of life'

[eliot]

Thankyou4calling said:

As would I.

Bought a lovely two bed flat in Brockley SE4 in 1990 for £72,000. Sold it after the market had recovered in 2000 for ..........£72,000.

At any time between I was well into negative equity.

Same here, bought a 3b eot in 1989 for £60k, it went down to £40k early 90's and I finally sold it in 2000 for.....£60k
Now worth about £180k

My parents bought at the same time in yorkshire and price followed same pattern.

[turbobloke]

eliot said:

Thankyou4calling said:

As would I.

Bought a lovely two bed flat in Brockley SE4 in 1990 for £72,000. Sold it after the market had recovered in 2000 for ..........£72,000.

At any time between I was well into negative equity.

Same here, bought a 3b eot in 1989 for £60k, it went down to £40k early 90's and I finally sold it in 2000 for.....£60k
Now worth about £180k

My parents bought at the same time in yorkshire and price followed same pattern.

I'm sure quite a few people have been there. To make working in London less painful many years ago I bought a shoebox on Weylea Farm in Burpham (Guildford) and doubled my money when it was sold. I thought that was OK, but the last sale of that petit bijou residence (!) in 2013 quintupled the price I paid with £210k changing hands for a 1-bed eot. Now valued at ~£250k, exceeding x6. However, real life happened in the interim with needs of its own!