How far to stretch for First Home?

[okgo]

NickCQ said:

Yeah, I also regret not buying all of the best-performing shares of 2014 and 2015. Hindsight's a wonderful thing.

Quite different. Prices of shares can go up as well as down, its been incredibly rare in London area for house prices to go down, for any real length of time. We're talking normal houses here, not super prime stuff.

And to the second poster, you are correct generally, but I've got a lot of the equity sitting in my bank account, and I don't envisage selling it in order to move on, so it will have served me well, but not quite as well as a more expensive place would have.

[NickCQ]

anonymous said:

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You can borrow against it though. Much cheaper to finance almost anything by securing it against home equity (2% ? borrowing cost) compared to car finance, unsecured loans or credit cards.

[R11ysf]

superkartracer said:

http://www.economist.com/blogs/dailychart/2011/11/...

Very interesting when you look at prices vs income chart, then you realise that actually compared to what we can earn in the UK we aren't really that high at all. Australia, Belgium, Canada, Hong Kong and Sweden all above us. We've gone up a lot in real terms but from a very low base, but we are a country of small size with a growing population so I can't see a massive fall until the pressure on housing is taken off.

If 500,000 people decide to leave because of Brexit then maybe so, but if not and we continue to be a powerful economy then the housing shortage can only get worse, especially in London.

[NRS]

anonymous said:

[redacted]

Thing is you could very well be right, and I think there will be a point soon where things drop - but not so much because of the house prices but because of how the markets look and that we are perhaps due a recession soon using historic timings of when they happen. That will then mean people have to tighten up up their spending and house prices will have to readjust.

However it's like what is posted about the stock market - there are loads of reasons not to buy a house at any one time. However when looking at the trend through time you would have lost out on a huge amount of money over the long term if you haven't. Your 40% blip in 1990 or so has been massively offset by the rises since. So unless you have to sell then you just sit on the house through the down times. No one says it's low risk, and you have to see what the market is doing now. But no matter what the reason (if it is people with vested interests or not) then on average you will have benefited to listen to them.

https://www.allagents.co.uk/house-prices-adjusted/

[p1stonhead]

anonymous said:

[redacted]

My uncle has a house building firm in Ireland. Its been a serious disaster over there for a decade. He basically hasnt done anything. Luckily he was quite well off.

[p1stonhead]

anonymous said:

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Ireland in global terms is the arse end of nowhere though. The UK isnt. It wouldnt happen to the same degree. There were too many houses for people in Ireland, its the opposite here.

[R11ysf]

p1stonhead said:

Ireland in global terms is the arse end of nowhere though. The UK isnt. It wouldnt happen to the same degree. There were too many houses for people in Ireland, its the opposite here.

This. And Ireland is a terrible example for this conversation as it is just another perfect example of Euro Union failure as when Ireland joined the Euro with 6% interest rates and bubbly inflation then ECB rate setting takes hold and its half that within 3 years, hence the massive BOOM. Also see Spain as another example of rate setting for one country shafting another with totally different economy.