How far will house prices fall [volume 5]
Discussion
kingston12 said:
I'd forgotten about that one, its made a massive difference as you say.
I remember when intergenerational mortgages were first talked about and it seemed such an alien concept, but it doesn't seem quite so far fetched now.
Indeed. Already its frightening how quickly they were introduced and swiftly became the norm. Not a small 3 - 5 year increment, but from 25 years to 35 almost in the blink of an eye. I remember when intergenerational mortgages were first talked about and it seemed such an alien concept, but it doesn't seem quite so far fetched now.
Couple that with the fact that deposit requirements are often meaning people are not buying until 30 - 32 years old and boom, there you have a whole working life of mortgage repayments. And yet of course supposed to squirrel away for your pension also. In times gone by you could look to accumulate a pension once your mortgage had been cleared.
These days its as though you rare signed up for your entire working life from the outset to a point you never become debt free. Student loans, mobile contracts, PCP car deals, mortgage that lasts a lifetime. You never clear the debt until you retire, and then you receive your humble pension where you have been prevented paying in due to a lifetime noose around the neck of debt. Truly sad situation IMO.
Shnozz said:
Indeed. Already its frightening how quickly they were introduced and swiftly became the norm. Not a small 3 - 5 year increment, but from 25 years to 35 almost in the blink of an eye.
Couple that with the fact that deposit requirements are often meaning people are not buying until 30 - 32 years old and boom, there you have a whole working life of mortgage repayments. And yet of course supposed to squirrel away for your pension also. In times gone by you could look to accumulate a pension once your mortgage had been cleared.
What is the alternative, a lifetime of rental payments instead? At least with a mortgage there will eventually be a point where it is repaid which is a massive amount of money saved each month. What is the endgame for those who are renting, how are you going to pay rent when you are retired.Couple that with the fact that deposit requirements are often meaning people are not buying until 30 - 32 years old and boom, there you have a whole working life of mortgage repayments. And yet of course supposed to squirrel away for your pension also. In times gone by you could look to accumulate a pension once your mortgage had been cleared.
Two examples, firstly a BTL where the rental is £1100 a month and the mortgage (interest only admittedly) is £260 a month. I am sure the tenants would rather have a mortgage than paying rent with nothing to show for it each month.
Secondly a repayment mortgage on a house that is only £200 a month than the identical house next door is renting for.
It's all very well saying prices have to fall but everybody needs to live somewhere. If you are choosing not to buy because you think a crash is due, then you will have to rent and give your money away to a landlord each month. Big gamble if you are wrong.
I have just read a post on HousePriceCrash where someone has stated that house prices have increased six percent since summer when they all told him not to buy.
Joey Deacon said:
Shnozz said:
Indeed. Already its frightening how quickly they were introduced and swiftly became the norm. Not a small 3 - 5 year increment, but from 25 years to 35 almost in the blink of an eye.
Couple that with the fact that deposit requirements are often meaning people are not buying until 30 - 32 years old and boom, there you have a whole working life of mortgage repayments. And yet of course supposed to squirrel away for your pension also. In times gone by you could look to accumulate a pension once your mortgage had been cleared.
What is the alternative, a lifetime of rental payments instead? At least with a mortgage there will eventually be a point where it is repaid which is a massive amount of money saved each month. What is the endgame for those who are renting, how are you going to pay rent when you are retired.Couple that with the fact that deposit requirements are often meaning people are not buying until 30 - 32 years old and boom, there you have a whole working life of mortgage repayments. And yet of course supposed to squirrel away for your pension also. In times gone by you could look to accumulate a pension once your mortgage had been cleared.
Two examples, firstly a BTL where the rental is £1100 a month and the mortgage (interest only admittedly) is £260 a month. I am sure the tenants would rather have a mortgage than paying rent with nothing to show for it each month.
Secondly a repayment mortgage on a house that is only £200 a month than the identical house next door is renting for.
It's all very well saying prices have to fall but everybody needs to live somewhere. If you are choosing not to buy because you think a crash is due, then you will have to rent and give your money away to a landlord each month. Big gamble if you are wrong.
I have just read a post on HousePriceCrash where someone has stated that house prices have increased six percent since summer when they all told him not to buy.
Joey Deacon said:
What is the alternative, a lifetime of rental payments instead? At least with a mortgage there will eventually be a point where it is repaid which is a massive amount of money saved each month. What is the endgame for those who are renting, how are you going to pay rent when you are retired.
Two examples, firstly a BTL where the rental is £1100 a month and the mortgage (interest only admittedly) is £260 a month. I am sure the tenants would rather have a mortgage than paying rent with nothing to show for it each month.
Secondly a repayment mortgage on a house that is only £200 a month than the identical house next door is renting for.
It's all very well saying prices have to fall but everybody needs to live somewhere. If you are choosing not to buy because you think a crash is due, then you will have to rent and give your money away to a landlord each month. Big gamble if you are wrong.
I have just read a post on HousePriceCrash where someone has stated that house prices have increased six percent since summer when they all told him not to buy.
I’m not saying there is an alternative. Just feel it’s sad that it’s been adopted and accepted and there isn’t a financially viable alternative. Lifetime loans are now the standard. Two examples, firstly a BTL where the rental is £1100 a month and the mortgage (interest only admittedly) is £260 a month. I am sure the tenants would rather have a mortgage than paying rent with nothing to show for it each month.
Secondly a repayment mortgage on a house that is only £200 a month than the identical house next door is renting for.
It's all very well saying prices have to fall but everybody needs to live somewhere. If you are choosing not to buy because you think a crash is due, then you will have to rent and give your money away to a landlord each month. Big gamble if you are wrong.
I have just read a post on HousePriceCrash where someone has stated that house prices have increased six percent since summer when they all told him not to buy.
Joey Deacon said:
Shnozz said:
Indeed. Already its frightening how quickly they were introduced and swiftly became the norm. Not a small 3 - 5 year increment, but from 25 years to 35 almost in the blink of an eye.
Couple that with the fact that deposit requirements are often meaning people are not buying until 30 - 32 years old and boom, there you have a whole working life of mortgage repayments. And yet of course supposed to squirrel away for your pension also. In times gone by you could look to accumulate a pension once your mortgage had been cleared.
What is the alternative, a lifetime of rental payments instead? At least with a mortgage there will eventually be a point where it is repaid which is a massive amount of money saved each month. What is the endgame for those who are renting, how are you going to pay rent when you are retired.Couple that with the fact that deposit requirements are often meaning people are not buying until 30 - 32 years old and boom, there you have a whole working life of mortgage repayments. And yet of course supposed to squirrel away for your pension also. In times gone by you could look to accumulate a pension once your mortgage had been cleared.
Two examples, firstly a BTL where the rental is £1100 a month and the mortgage (interest only admittedly) is £260 a month. I am sure the tenants would rather have a mortgage than paying rent with nothing to show for it each month.
Secondly a repayment mortgage on a house that is only £200 a month than the identical house next door is renting for.
It's all very well saying prices have to fall but everybody needs to live somewhere. If you are choosing not to buy because you think a crash is due, then you will have to rent and give your money away to a landlord each month. Big gamble if you are wrong.
I have just read a post on HousePriceCrash where someone has stated that house prices have increased six percent since summer when they all told him not to buy.
It’s interesting to see where we’ll go next to increase prices. I certainly see full lifetime mortgages now that people are working longer. Intergenerational loans are still probably a step too far at the moment.
Boris’ proposal of government underwritten mortgages is an interesting one. I’m not sure if the detail has been made available yet, but I expect it might be the return of 100% mortgages, and perhaps an increase in income multiples?
kingston12 said:
It’s interesting to see where we’ll go next to increase prices. I certainly see full lifetime mortgages now that people are working longer. Intergenerational loans are still probably a step too far at the moment.
Boris’ proposal of government underwritten mortgages is an interesting one. I’m not sure if the detail has been made available yet, but I expect it might be the return of 100% mortgages, and perhaps an increase in income multiples?
I reckon government underwriting is the likely way forward, as it isn’t much of a step on from where we are already with furlough and mortgage holidays.Boris’ proposal of government underwritten mortgages is an interesting one. I’m not sure if the detail has been made available yet, but I expect it might be the return of 100% mortgages, and perhaps an increase in income multiples?
There is a big problem with lifetime or long terms loans though- the quality of jobs and level of income that is available to you in your later years can be much reduced.
Many people struggle to get decent work after 50, corporations are always looking to replace expensive people with younger/cheaper.
How does one pay off the back end of the mega mortgage if quality employment is not available?
It's cheaper than renting on an equivalent basis, so let's address that first.
Mortgage payments get eroded by inflation - even at a low level it makes a difference over 20 years +, rent does the opposite.
How do all the people renting at say 1k pcm + in retirement manage it now? Good personal pension provision? State support? Or are there so few of them it makes no odds? Or are they in low cost state funded/social housing? I don't know.
Mortgage payments get eroded by inflation - even at a low level it makes a difference over 20 years +, rent does the opposite.
How do all the people renting at say 1k pcm + in retirement manage it now? Good personal pension provision? State support? Or are there so few of them it makes no odds? Or are they in low cost state funded/social housing? I don't know.
number2 said:
How do all the people renting at say 1k pcm + in retirement manage it now? Good personal pension provision? State support? Or are there so few of them it makes no odds? Or are they in low cost state funded/social housing? I don't know.
Most of those in retirement now were of a generation where they bought and could afford to buy so I should imagine it effects very few. For the remainder, you are unlikely to be paying £1k PCM on a smaller retirement place especially when your location isn't dictated by work. Other than perhaps family proximity, why you would even remain in the UK once you've retired would baffle me. Many retirees near my place in Spain rent as its far cheaper than buying more akin to the UK many moons ago. A small place can be €400 PCM so even on a state pension its doable.
711 said:
I reckon government underwriting is the likely way forward, as it isn’t much of a step on from where we are already with furlough and mortgage holidays.
There is a big problem with lifetime or long terms loans though- the quality of jobs and level of income that is available to you in your later years can be much reduced.
Many people struggle to get decent work after 50, corporations are always looking to replace expensive people with younger/cheaper.
How does one pay off the back end of the mega mortgage if quality employment is not available?
I've thought about those things before and it seems like a big concern to me. The way things are heading you could be coming up to the age of 50 and still have close to 20 years to go before state pension. Health, employment opportunities etc could become issues. For me having a mortgage paid off or at least well under control by that age would be seen as essential. There is a big problem with lifetime or long terms loans though- the quality of jobs and level of income that is available to you in your later years can be much reduced.
Many people struggle to get decent work after 50, corporations are always looking to replace expensive people with younger/cheaper.
How does one pay off the back end of the mega mortgage if quality employment is not available?
Talking about 35 year mortgages just got the keys yesterday for my first house been a long road to get to this place when I put the offer on the house in august. 97,500 purchase price 15% deposit with a 2.49% interest lowest at the time mortgage payments just a snip over £300 month.
For comparison I have been a renting a unit for the last 5 years till april this year with a mate of mine as a place to store my kit car trailer etc at £350 per month.
The new house comes with a garage so im quids in from renting a unit. The equivalent house in rental prices in the area is around £500.
Ive been lucky that by 28 and mainly this year ive drastically cut my expenses paid of my car 9k and saved enough to purchase a property on my own with not a high income job (mot tester/tech at a main dealer). I can pay of up to 10% of the mortgage valve per year so will try and chip away at it and bring that 35 year mortgage down a bit over the years.
In the short term im just happy after such a interesting year to put it mildly I can finally say I own my own house.
For comparison I have been a renting a unit for the last 5 years till april this year with a mate of mine as a place to store my kit car trailer etc at £350 per month.
The new house comes with a garage so im quids in from renting a unit. The equivalent house in rental prices in the area is around £500.
Ive been lucky that by 28 and mainly this year ive drastically cut my expenses paid of my car 9k and saved enough to purchase a property on my own with not a high income job (mot tester/tech at a main dealer). I can pay of up to 10% of the mortgage valve per year so will try and chip away at it and bring that 35 year mortgage down a bit over the years.
In the short term im just happy after such a interesting year to put it mildly I can finally say I own my own house.
MG CHRIS said:
Talking about 35 year mortgages just got the keys yesterday for my first house been a long road to get to this place when I put the offer on the house in august. 97,500 purchase price 15% deposit with a 2.49% interest lowest at the time mortgage payments just a snip over £300 month.
For comparison I have been a renting a unit for the last 5 years till april this year with a mate of mine as a place to store my kit car trailer etc at £350 per month.
The new house comes with a garage so im quids in from renting a unit. The equivalent house in rental prices in the area is around £500.
Ive been lucky that by 28 and mainly this year ive drastically cut my expenses paid of my car 9k and saved enough to purchase a property on my own with not a high income job (mot tester/tech at a main dealer). I can pay of up to 10% of the mortgage valve per year so will try and chip away at it and bring that 35 year mortgage down a bit over the years.
In the short term im just happy after such a interesting year to put it mildly I can finally say I own my own house.
Excellent stuff. Best of wishes with the new house.For comparison I have been a renting a unit for the last 5 years till april this year with a mate of mine as a place to store my kit car trailer etc at £350 per month.
The new house comes with a garage so im quids in from renting a unit. The equivalent house in rental prices in the area is around £500.
Ive been lucky that by 28 and mainly this year ive drastically cut my expenses paid of my car 9k and saved enough to purchase a property on my own with not a high income job (mot tester/tech at a main dealer). I can pay of up to 10% of the mortgage valve per year so will try and chip away at it and bring that 35 year mortgage down a bit over the years.
In the short term im just happy after such a interesting year to put it mildly I can finally say I own my own house.
MG CHRIS said:
Talking about 35 year mortgages just got the keys yesterday for my first house been a long road to get to this place when I put the offer on the house in august. 97,500 purchase price 15% deposit with a 2.49% interest lowest at the time mortgage payments just a snip over £300 month.
For comparison I have been a renting a unit for the last 5 years till april this year with a mate of mine as a place to store my kit car trailer etc at £350 per month.
The new house comes with a garage so im quids in from renting a unit. The equivalent house in rental prices in the area is around £500.
Ive been lucky that by 28 and mainly this year ive drastically cut my expenses paid of my car 9k and saved enough to purchase a property on my own with not a high income job (mot tester/tech at a main dealer). I can pay of up to 10% of the mortgage valve per year so will try and chip away at it and bring that 35 year mortgage down a bit over the years.
In the short term im just happy after such a interesting year to put it mildly I can finally say I own my own house.
Best you can do is over pay, over pay, over pay! Can we see the RM link now? For comparison I have been a renting a unit for the last 5 years till april this year with a mate of mine as a place to store my kit car trailer etc at £350 per month.
The new house comes with a garage so im quids in from renting a unit. The equivalent house in rental prices in the area is around £500.
Ive been lucky that by 28 and mainly this year ive drastically cut my expenses paid of my car 9k and saved enough to purchase a property on my own with not a high income job (mot tester/tech at a main dealer). I can pay of up to 10% of the mortgage valve per year so will try and chip away at it and bring that 35 year mortgage down a bit over the years.
In the short term im just happy after such a interesting year to put it mildly I can finally say I own my own house.
MG CHRIS said:
Talking about 35 year mortgages just got the keys yesterday for my first house been a long road to get to this place when I put the offer on the house in august. 97,500 purchase price 15% deposit with a 2.49% interest lowest at the time mortgage payments just a snip over £300 month.
For comparison I have been a renting a unit for the last 5 years till april this year with a mate of mine as a place to store my kit car trailer etc at £350 per month.
The new house comes with a garage so im quids in from renting a unit. The equivalent house in rental prices in the area is around £500.
Ive been lucky that by 28 and mainly this year ive drastically cut my expenses paid of my car 9k and saved enough to purchase a property on my own with not a high income job (mot tester/tech at a main dealer). I can pay of up to 10% of the mortgage valve per year so will try and chip away at it and bring that 35 year mortgage down a bit over the years.
In the short term im just happy after such a interesting year to put it mildly I can finally say I own my own house.
Sounds great to me. If you're on any kind of average wage with no other financial help you really need to have a foot on the ladder before 30, and the sooner the better. I know people now getting into their 30s and still seem to think they've all the time in the world to buy somewhere. I was in a similar position to yourself, mot tester / mechanic, so earning but not big and no other financial help, and just knew on that income I had to give it a shot as soon as I could. Ended up really pushing it on the size of the mortgage which was a huge amount of my basic pay to start off with, but ultimately in the longer run it's saved having to move as I had a reasonable sized place from the start. Good luck ! It might not always be plain sailing but if you're sensible it definitely comes good later on. For comparison I have been a renting a unit for the last 5 years till april this year with a mate of mine as a place to store my kit car trailer etc at £350 per month.
The new house comes with a garage so im quids in from renting a unit. The equivalent house in rental prices in the area is around £500.
Ive been lucky that by 28 and mainly this year ive drastically cut my expenses paid of my car 9k and saved enough to purchase a property on my own with not a high income job (mot tester/tech at a main dealer). I can pay of up to 10% of the mortgage valve per year so will try and chip away at it and bring that 35 year mortgage down a bit over the years.
In the short term im just happy after such a interesting year to put it mildly I can finally say I own my own house.
MuscleSedan said:
MG CHRIS said:
Talking about 35 year mortgages just got the keys yesterday for my first house been a long road to get to this place when I put the offer on the house in august. 97,500 purchase price 15% deposit with a 2.49% interest lowest at the time mortgage payments just a snip over £300 month.
For comparison I have been a renting a unit for the last 5 years till april this year with a mate of mine as a place to store my kit car trailer etc at £350 per month.
The new house comes with a garage so im quids in from renting a unit. The equivalent house in rental prices in the area is around £500.
Ive been lucky that by 28 and mainly this year ive drastically cut my expenses paid of my car 9k and saved enough to purchase a property on my own with not a high income job (mot tester/tech at a main dealer). I can pay of up to 10% of the mortgage valve per year so will try and chip away at it and bring that 35 year mortgage down a bit over the years.
In the short term im just happy after such a interesting year to put it mildly I can finally say I own my own house.
Sounds great to me. If you're on any kind of average wage with no other financial help you really need to have a foot on the ladder before 30, and the sooner the better. I know people now getting into their 30s and still seem to think they've all the time in the world to buy somewhere. I was in a similar position to yourself, mot tester / mechanic, so earning but not big and no other financial help, and just knew on that income I had to give it a shot as soon as I could. Ended up really pushing it on the size of the mortgage which was a huge amount of my basic pay to start off with, but ultimately in the longer run it's saved having to move as I had a reasonable sized place from the start. Good luck ! It might not always be plain sailing but if you're sensible it definitely comes good later on. For comparison I have been a renting a unit for the last 5 years till april this year with a mate of mine as a place to store my kit car trailer etc at £350 per month.
The new house comes with a garage so im quids in from renting a unit. The equivalent house in rental prices in the area is around £500.
Ive been lucky that by 28 and mainly this year ive drastically cut my expenses paid of my car 9k and saved enough to purchase a property on my own with not a high income job (mot tester/tech at a main dealer). I can pay of up to 10% of the mortgage valve per year so will try and chip away at it and bring that 35 year mortgage down a bit over the years.
In the short term im just happy after such a interesting year to put it mildly I can finally say I own my own house.
I paid off my car 9k during the summer reduced my outgoings to just fuel cost for work etc. With a bit of savings built up over the last 20 years the money I saved over the year got up to a nice chunk around 20k which helped massively. 4k left too do things in the house and if things get tight even got the kit car left I can sell.
I got a bit of help from parents the deposit was all me but If things get tight im ok to a certain point. Im just glad its all done ready for Christmas can now focus on that over all the other worries in this mad year.
kingston12 said:
Bullet-Proof_Biscuit said:
Nationwide came back to me after receiving the damp & timber survey and the retention went upto £10k now, beans for Christmas it is!
Why don’t you just push back on the vendor?Bullet-Proof_Biscuit said:
Only because cash buyers were after the place like piranhas! It's well located for distance between the uni, town centre & the beach. I did cautiously negotiate to reduce 25% of the retention though.
I just recently got a job offer in Bournemouth, had to turn it down after seeing the property prices. It was not too different from "affordable" parts of London! I used to work there for a while back in 2009, prices were not this high, except mad places like Sandbanks.Gassing Station | News, Politics & Economics | Top of Page | What's New | My Stuff