Is it a Good Time to Buy a House?
Discussion
North London\Hertfordshire suburbs sort of area. House prices haven't really dropped there at all even through the worst of the recession, in fact I think they are a little overpriced for what you get and definitely in a bubble but it's the price you pay if you want to live anywhere in London which is halfway decent.
Figuring out whether to jump in with both feet or wait to see if the bubble will eventually burst seems like an exercise in frustration sometimes but it's one I want to get right for obvious reasons.
Figuring out whether to jump in with both feet or wait to see if the bubble will eventually burst seems like an exercise in frustration sometimes but it's one I want to get right for obvious reasons.
Guvernator said:
North London\Hertfordshire suburbs sort of area. House prices haven't really dropped there at all even through the worst of the recession, in fact I think they are a little overpriced for what you get and definitely in a bubble but it's the price you pay if you want to live anywhere in London which is halfway decent.
Figuring out whether to jump in with both feet or wait to see if the bubble will eventually burst seems like an exercise in frustration sometimes but it's one I want to get right for obvious reasons.
MIL/FIL/SIL/BIL, all live in sawbridgeworth, and funnily enough we had this convo today about house prices up here (Derbyshire) and down there.Figuring out whether to jump in with both feet or wait to see if the bubble will eventually burst seems like an exercise in frustration sometimes but it's one I want to get right for obvious reasons.
And he was saying similar houses are either on the market for ages or snapped up, but he was undecided as to whether they d been bought by people wanting to live in them or people buying them up for rent due to the travel links to London etc.
Strange one really like you say get it right your laughing get it wrong and even thou your in it for the long haul its still not pretty living in something thats not worth at a minimum what you paid for it.
Sarnie said:
From todays HPI;
"Commenting on the figures, Robert Gardner, Nationwide's Chief Economist, said:
“UK house prices increased by 0.6% in October, more than offsetting the 0.4% decline recorded the previous month. Monthly price changes have failed to establish a strong trend in either direction over the past six months, with three months of increases and three months of price declines since May 2012.
“The annual pace of change continues to display a picture of relative stability, with house prices down just 0.9% compared to October 2011. This maintains the pattern that has been evident since late 2010, with annual price growth remaining in a narrow band between +1.5% and -1.5% on all but two occasions over the past two years.”
Questionable house price statistics, i'm surprised they even use them. In this climate the only people buying are people with money. 3 houses bought at £500k is an average house price of £500k so not a particularly good indication."Commenting on the figures, Robert Gardner, Nationwide's Chief Economist, said:
“UK house prices increased by 0.6% in October, more than offsetting the 0.4% decline recorded the previous month. Monthly price changes have failed to establish a strong trend in either direction over the past six months, with three months of increases and three months of price declines since May 2012.
“The annual pace of change continues to display a picture of relative stability, with house prices down just 0.9% compared to October 2011. This maintains the pattern that has been evident since late 2010, with annual price growth remaining in a narrow band between +1.5% and -1.5% on all but two occasions over the past two years.”
Numbers sold would be more appropriate.
Guvernator said:
North London\Hertfordshire suburbs sort of area. House prices haven't really dropped there at all even through the worst of the recession, in fact I think they are a little overpriced for what you get and definitely in a bubble but it's the price you pay if you want to live anywhere in London which is halfway decent.
Figuring out whether to jump in with both feet or wait to see if the bubble will eventually burst seems like an exercise in frustration sometimes but it's one I want to get right for obvious reasons.
In exactly the same boat. Been looking for last few months in Finchley/Mill Hill areas and I am staggered at what you don't get for the money. I'd like to think I have my eyes open, have bought in Finchely twice in the last 10 years, but the few appropriate houses that come on that I deem are 'over priced' by some margin are going for asking. That obviously is what the market (and zoopla Figuring out whether to jump in with both feet or wait to see if the bubble will eventually burst seems like an exercise in frustration sometimes but it's one I want to get right for obvious reasons.
) think is fair value, but, but, but....
f1_dragon said:
In exactly the same boat. Been looking for last few months in Finchley/Mill Hill areas and I am staggered at what you don't get for the money. I'd like to think I have my eyes open, have bought in Finchely twice in the last 10 years, but the few appropriate houses that come on that I deem are 'over priced' by some margin are going for asking. That obviously is what the market (and zoopla ) think is fair value, but, but, but....
As someone else mentioned, I'd like to know just who his buying these houses to be honest. Are they Buy-To-Letters or people intending to actually live in them and if they are paying these over inflated prices, are they blindly jumping in or do they know something we don't know? ) think is fair value, but, but, but....If the missus was up for living further out and I could stomach the commute I would consider it as you get A LOT more for your money but I just can't stand the thought of spending 3 hours of my life commuting every day and the missus doesn't want to live in the "middle of nowhere" (her words). I think 2013 could be the make or break year for house prices and indeed the economy in general.
Guvernator said:
I think 2013 could be the make or break year for house prices and indeed the economy in general.
Unfortunately you can't say, it can drag for years if not decades...Have you considered the Southern fringes of greater London (if suitable)? It looks noticeably cheaper and there are some good areas and overground trains rather than underground.
chris7676 said:
Unfortunately you can't say, it can drag for years if not decades...
Have you considered the Southern fringes of greater London (if suitable)? It looks noticeably cheaper and there are some good areas and overground trains rather than underground.
Personally I think it could go either way, stagnate for years or crash but I think price rises are off the books for a while at least. The problem is even the "experts" don't seen to know. We have a lot of people trying to project a sense of optimism and latching onto any bit of good news and then you have a few who are predicting massive doom and gloom.Have you considered the Southern fringes of greater London (if suitable)? It looks noticeably cheaper and there are some good areas and overground trains rather than underground.
South London is a no go for several reasons unfortunately. Firstly I need to be not too far from my parents who also live in North London. Secondly I don't like South London (it's that north\south divide thing
)Guvernator said:
As someone else mentioned, I'd like to know just who his buying these houses to be honest. Are they Buy-To-Letters or people intending to actually live in them and if they are paying these over inflated prices, are they blindly jumping in or do they know something we don't know?
I read an article somewhere where an agent suggested what's going on this year in London is parents selling £1.5M+ ish houses (the buyers being mainly foreign), downsizing or moving out of London themselves and bunging £250-500K to their kids.OP, you're getting far to hung up (as many people do) on the nominal value of houses. Inflation has a massive effect on 'real' value over the long term. Even if house prices 'stay the same' they will roughly halve in real terms over the next 10 years if inflation remains around 3%. If prices are 10% lower or 10% higher in nominal terms it doesn't really matter. If you're borrowing to buy inflation is your friend though, as it erodes the value of your debt.
Ultimately, you can borrow very cheaply at the moment, and inflation is eroding your debt. If you think interest rates are going to stay low and inflation moderate, you should buy. If you think interest rates are going to shoot up, and inflation low, you probbaly shouldn't. Personally, I fall into the former camp and bought a house in August.
Ultimately, you can borrow very cheaply at the moment, and inflation is eroding your debt. If you think interest rates are going to stay low and inflation moderate, you should buy. If you think interest rates are going to shoot up, and inflation low, you probbaly shouldn't. Personally, I fall into the former camp and bought a house in August.
I don't disagree with any of that. I guess it comes down to raising the extra upfront cash for deposit, stamp duty and then higher monthly repayments when it feels like London could be a bubble with the possibility of bursting making the same houses more affordable.
Out of curiously what type of mortgage deal did you go for if you don't mind answering?
Out of curiously what type of mortgage deal did you go for if you don't mind answering?
CaptainSensib1e said:
OP, you're getting far to hung up (as many people do) on the nominal value of houses. Inflation has a massive effect on 'real' value over the long term. Even if house prices 'stay the same' they will roughly halve in real terms over the next 10 years if inflation remains around 3%. If prices are 10% lower or 10% higher in nominal terms it doesn't really matter. If you're borrowing to buy inflation is your friend though, as it erodes the value of your debt.
Ultimately, you can borrow very cheaply at the moment, and inflation is eroding your debt. If you think interest rates are going to stay low and inflation moderate, you should buy. If you think interest rates are going to shoot up, and inflation low, you probbaly shouldn't. Personally, I fall into the former camp and bought a house in August.
I think you need to clarify what you mean by inflation - general inflation or wage inflation. If wages aren't increasing, I can't see how inflation is eroding debt.Ultimately, you can borrow very cheaply at the moment, and inflation is eroding your debt. If you think interest rates are going to stay low and inflation moderate, you should buy. If you think interest rates are going to shoot up, and inflation low, you probbaly shouldn't. Personally, I fall into the former camp and bought a house in August.
CaptainSensib1e said:
OP, you're getting far to hung up (as many people do) on the nominal value of houses. Inflation has a massive effect on 'real' value over the long term. Even if house prices 'stay the same' they will roughly halve in real terms over the next 10 years if inflation remains around 3%. If prices are 10% lower or 10% higher in nominal terms it doesn't really matter. If you're borrowing to buy inflation is your friend though, as it erodes the value of your debt.
Ultimately, you can borrow very cheaply at the moment, and inflation is eroding your debt. If you think interest rates are going to stay low and inflation moderate, you should buy. If you think interest rates are going to shoot up, and inflation low, you probbaly shouldn't. Personally, I fall into the former camp and bought a house in August.
I don't think I'm getting hung up on the value in a traditional sense, I'm not planning on using my property to prop up my pension if that's what you mean. I am just a bit wary about purchasing a house at an over-inflated price and then seeing it all go t*ts up if the economy goes into meltdown. Ultimately, you can borrow very cheaply at the moment, and inflation is eroding your debt. If you think interest rates are going to stay low and inflation moderate, you should buy. If you think interest rates are going to shoot up, and inflation low, you probbaly shouldn't. Personally, I fall into the former camp and bought a house in August.
I personally haven't been in that situation before but friends have and from what they've told me it was horrible owing a huge amount of money to the bank on an asset which isn't worth what you paid for it. One scary scenario for instance is what happens if you need to sell up in a hurry for whatever reason? Now admittedly this will be somewhat mitigated as I will be putting down a big deposit but I imagine no one really enjoyed going through that situation in the 90's.
I guess this thread was more about trying to gauge how positive people where about what direction the economy, house prices and interest rates would go. I just think it's worth doing as much research as possible before making the biggest financial commitment you'll ever make in your life, the problem is no one seems to know what will happen!
If you're trying to play the market a bit, then good luck. If you want to look at the house you've got and be thankful that you've got the equity you've got, just get on with your life and find the home you want to grow your family in.
You sound like you've done very well with your current house, possibly due to timing. If there is a drop in prices, look at it that ist eroding some of the increase in value you had on the house you bought however many years ago you bought.
IMO, now is as good a time to sell/buy another home....but if you're looking to buy for the firs time, then I would say sit tight and see what happens. I'm pretty sure they're not going to be running away in price any time soon....but then I thought that in 2003.
You sound like you've done very well with your current house, possibly due to timing. If there is a drop in prices, look at it that ist eroding some of the increase in value you had on the house you bought however many years ago you bought.
IMO, now is as good a time to sell/buy another home....but if you're looking to buy for the firs time, then I would say sit tight and see what happens. I'm pretty sure they're not going to be running away in price any time soon....but then I thought that in 2003.
Pork said:
If you're trying to play the market a bit, then good luck. If you want to look at the house you've got and be thankful that you've got the equity you've got, just get on with your life and find the home you want to grow your family in.
You sound like you've done very well with your current house, possibly due to timing. If there is a drop in prices, look at it that ist eroding some of the increase in value you had on the house you bought however many years ago you bought.
IMO, now is as good a time to sell/buy another home....but if you're looking to buy for the firs time, then I would say sit tight and see what happens. I'm pretty sure they're not going to be running away in price any time soon....but then I thought that in 2003.
I guess I can agree with a lot of that, I was lucky and "won" in the first round of property snakes and ladders so should see that as my safety cushion for any fluctutions. However for me it wouldn't be about saving money or making a good return on my investment, I am looking at it from the view that if prices do go down, I will be able to get more house for my money which is important as I plan to be there for a long time.You sound like you've done very well with your current house, possibly due to timing. If there is a drop in prices, look at it that ist eroding some of the increase in value you had on the house you bought however many years ago you bought.
IMO, now is as good a time to sell/buy another home....but if you're looking to buy for the firs time, then I would say sit tight and see what happens. I'm pretty sure they're not going to be running away in price any time soon....but then I thought that in 2003.
The last line is very true too, all the indicators point to the fact that house prices won't increase dramatically for the forseeable future but then stranger things have happened in the past and could well happen again.
Derek Chevalier said:
I think you need to clarify what you mean by inflation - general inflation or wage inflation. If wages aren't increasing, I can't see how inflation is eroding debt.
Over the long-term wage inflation will lead to 'general' inflation as you put it, or price inflation as its more commonly known. If companies are having to pay workers more then they will have to put up the prices of their goods and services to compensate. What causes inflation is irrelevant to this discussion, its the fact there is inflation as its impact that's important.Guvernator said:
I don't think I'm getting hung up on the value in a traditional sense, I'm not planning on using my property to prop up my pension if that's what you mean. I am just a bit wary about purchasing a house at an over-inflated price and then seeing it all go t*ts up if the economy goes into meltdown.
That's not really what I was driving at. It's like when I was a kid I could buy a copy of the Beano for 15p. Today a copy costs £1.50. If I'd bought a house for £15,000 when I was a kid, and it was worth £150,000 today, it would actually be worth a similar amount in real terms, although its price has gone up ten fold.Anyway, if you are concerned that the economy is going into meltdown you probably shouldn't be looking at buying a house. But even the finest brains in the country can't accurately predict what's going to happen to the ecnomy so at best its a guessing game. Personally I think we are in for a long period of stagnant growth while we get to grips with our massive nartional debt. If I'm right, then interest rates will have to stay to low encourage growth, and house prices will stay around their current level in nominal terms (although falling slightly in real terms, taking inflation into account).
Have you considered Potters Bar? I was also looking North London/South Herts. Train line is reliable and fairly quick to Kings Cross or Moorgate and houses are a lot more reasonable than North London.
Best places are off of The Walk, a short stroll from the station. High Streets are OK, lots of restaurants. There are a couple of ugly high rise office blocks, but once you get past that it’s not a bad place to live and extremely convenient for commuting by train/car.
Not sure where you work but my season ticket works out cheaper than the tube (say from high barnet).
Best places are off of The Walk, a short stroll from the station. High Streets are OK, lots of restaurants. There are a couple of ugly high rise office blocks, but once you get past that it’s not a bad place to live and extremely convenient for commuting by train/car.
Not sure where you work but my season ticket works out cheaper than the tube (say from high barnet).
masteryoda said:
Have you considered Potters Bar? I was also looking North London/South Herts. Train line is reliable and fairly quick to Kings Cross or Moorgate and houses are a lot more reasonable than North London.
Best places are off of The Walk, a short stroll from the station. High Streets are OK, lots of restaurants. There are a couple of ugly high rise office blocks, but once you get past that it’s not a bad place to live and extremely convenient for commuting by train/car.
Not sure where you work but my season ticket works out cheaper than the tube (say from high barnet).
Yes it's one of the areas we are considering but it seems to be an area of two halves with some relatively cheap houses but again, anything which is a halfway decent size or near to the stations\decent schools is almost the same high price as other areas in North London, definitely a possibility though.Best places are off of The Walk, a short stroll from the station. High Streets are OK, lots of restaurants. There are a couple of ugly high rise office blocks, but once you get past that it’s not a bad place to live and extremely convenient for commuting by train/car.
Not sure where you work but my season ticket works out cheaper than the tube (say from high barnet).
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