I am now saving my Money until have a 15-20 percent deposit to make that purchase for my own place, I will make that purchase once I have this deposit in around late 2005 or early 2006. I don't care if the prices go up or go down, I just want my own place that I can call my OWN HOME... It may only be a One bedroom flat or a studio but its a start...

This means no going out/no holidays while I am saving.... Oh well you cannot have everything !!

Just one more thing. I like to wish everybody a MERRY CHRISTMAS AND ALL THE BEST FOR NEW YEAR..

sonny

So, late 2005 to mid 2006 when HPs are falling by 10-15% pa you're going to buy a place? Do please tell us when you have done so - I'll enjoy the read.

Or, of course, you could just carry on renting until prices stabilise at rock bottom levels and then buy. I guess that would be too messy for you?

[quote=Sonny,Dec 20 2004, 08:44 PM]
I decided to purchase my own home in the next 12 - 18 month time.

18 months time will see prices down at least 30% from their highs so if thats what rocks your boat go for it but dont forget prices have risen in some places 160% so 30% is a drop in the ocean this bloated fairy tale market is totally fukced and has years of decline to come so why not take the cheap rent,save hard and bide your time a little longer i have been waiting three years already and know what frustration is all about but there is NO way i am going to help this market stagger back on its feet by buying before it is at the bottom,remember all peaks have troughs, dont be afraid of missing the bottom, be informed follow housepricecrash it will show you the RIGHT time to buy....happy xmas/holidays to one and all me im off to gambia for two weeks partly paid by my landlords genorosity!!!!!!!

I already have a 15% deposit for the kind of place we want, but this would still mean a massive mortgage with little slack.

If you are saving a 15- 20% deposit, how is it going to be your own home? You'll be paying loads to sevrice the mortgage interest? Worse, a studio or one bed, unless a new commonhold, will fall under the UK's unique leasehold system. Not exactly own home heaven.

I not going to see that big deposit that we've sweating over for years go to let some speculator bail out of the massively overinflated market.

[quote=Financial Planner,Dec 21 2004, 09:48 AM]
So, late 2005 to mid 2006 when HPs are falling by 10-15% pa


Whats make you certain that prices will fall ? they could go up again or may just stay steady.. Ref my post earlier, I should have mention that I will make the purchase in around 12 - 18 month time and NOT in the next 12 - 18 month time... (sorry typo error). If the prices go down it be a bonus for me. If they go up, who cares I still be in a better financial position as I will have a deposit.

I am 35 years old and time is running out for me to make that step on that property ladder....

We have made the conscious decision to rent even if prices drop. We are currently renting a house and find this an excellent way to live.

We have the flexibility to move should careers or our personal situation require us to.

We do not have to pay for repairs or redecoration.

We do not have to pay for a gardener to mow our lawn.

We do not have to pay for buildings insurance

We are saving a large amount of money and already have a large nest egg. Our savings are earning us interest which means that we can survive on one income easily.

Things are great.

Come on guys, I'm totally with Sonny on this. It's one thing to want to buy at the bottom it's another to buy at the bottom at the expense of everything else in your life.

Myself, I'm 30, just got married and because the wife is 3 yrs older than me she is desperate to have kids. I'd also like them. Now I don't want to bring up a child in rented accommodation so personally I'll be buying when we have enough of a deposit saved, I reckon this'll take around 12 months.

Yes, I want to see a crash, yes I believe we'll see one, but sometimes buying a home at the bottom is not what it's all about. Houses should be homes for families not financial assets, otherwise we're no better than BTL.

Also gents remember the best bargains are to be had just BEFORE the trough of a bust, fear is at its height and your bargaining power is at its peak.

Keep your fingers crossed for me!!

in a nutshell, spot on bullish bear,waverers read and inwardly digest........

I'll be 35 next month, but I'm not committing financial suicide by joining the house party just as everyone wakes up with their heads down the toilet.

Instead I'll be one of those annoying people who turns up for the afternoon pub session the next day hangover-free and with a great big grin on my face

And it may well be the finish as well.





LOL!


This is what the bulls are counting on. If enough people cave in, the madness will continue. Don't let them.

Sonny, youre going to miss the boat. You can currently snatch a bargain from a distressed / pressured vendor, at about 15% lower than 6 months ago.

Once the 'I dont want to get left behind again FTBs' return in early 2005, it will be too late.

My advice - use a lower deposit and buy now.

Why are they not returning now, dogbollox, if there are such bargains to be had?

The smart ones are - but this wont show up on one of your data reports because such reports are always yesterdays news. Get out more ZZ.

Like the 25% fall in mortgage approvals yesterday dogbrain? that kind of news?

Worth 60k 4 years ago, 150k 6 months ago, so now a bargain at 135k. Fantastic logic.

Don't buy now wait until the "repossessions near all time high" headlines then jump in.

And why do many of my countrymen have the "renting is bad owning with enormous mortgage is good" attitude its like they're a bunch of brainwashed zombies.

If I can rent a place for £600 a month or buy it and pay £800 a month interest I'll never buy. I'll just save the difference and enjoy my debt free retirement thank you very much.

I'm 32 and still yet to get on the property ladder, had a couple of chances to buy prior to the boom, but for various reasons that I don't want to get into here, I didn't.
Probably like allot of people I held off buying believing that the boom couldn't continue for as long as it did (although at the time I didn't understand the market fundamentals), this was a major mistake, but I'm not going to compound this by making another mistake by buying any time soon.
I'm lucky as I have over 100k saved as a deposit and so I could afford to buy now, I simply refuse to do so as these insane prices!

Jesus! With that kind of money you could buy a house outright in several parts of the UK, all of Canada, France, etc etc. Why buy in the crappy UK when you've got that kind of money???

Unfortunately in the south, used to live in London, currently on the south west coast, 100k doesn’t get you very far, also if the market doesn't correct (unlikely IMHO) then I'll probably be moving abroad to Spain, where I'll just buy a place out-right. I simple refuse to take out a huge mortgage just so I can live in a modest home!

I'm in the same position as you, Crashed.
The problem is if enough other people are positive about home buying prices won't fall sharply,.......I know potential FTBs who're as keen as mustard even now....They want to buy simply because they've reached that stage of their lives.. ,..and unlike a lot of us aren't kicking themselves they didn't buy 6 years ago as they were too young to buy then....,,,,,,,That said i don't think you need worry about prices rising further in the next 4 or 5 years at least..........

Absolutely right. Life is more important than money and if you can afford the repayments and the house is big enough for children then go for it. I fully understand 20 something FTB's waiting - I would too, but people in their 30's have more to life. Imagine if you missed out on having children by waiting 2 or three years for houses to drop in price - what a waste!

If they were too young to buy before the boom they have certainly NOT "reached that stage" of their lives.

UA, most FTB's do not have 100 grand lying around and cannot afford a house big enough for children, or even a house at all.




Imagine if you mortgaged yourself to the hilt to buy a house now and missed out on the children growing up because you had to work all hours to pay the mortgage when if you'd waited you would have had a much smaller mortgage.

They are stupid to be thinking of buying now. Michael, have you pointed out to them this is not a very wise course of action in the present climate?

That's crap ZZ, sorry mate!

Take my position

1995 - 2000 - University Student. Living with current wife
2000 - first job at 26 working for MOD in Surrey, no money due to student debts & moving to new area. Living with current wife who now wants kids & a house.
2002 - cleared most debts by now & got a new job now at almost double what I was previosuly on. Living with current wife who now wants kids & a house.
2003 - All debts bar the Student Loan now cleared, start looking at / saving for a house. Prime Boom time so nothing available in price range. Start reading about economics. Living with current wife who now wants kids & a house. Choose to marry rather than buy.
2004 - house prices appear to be leveling off prior to crash. Marry current wife at start of year. Now 30 yrs old.

Now that's a pretty damn typical timeline for many people, many of my friends from uni are now 28 and married. They are still buying because the need a place to have kids. Their priorities are jobs, family and kids NOT loosing 20K or 40K or 100K on a place and putting their lives on hold in the meantime.

Like it or not ZZ this is how real people behave in real life.

What happened to the 3 years between 18 and 21?




Talk about one-track mind. Does your wife ever think/talk about anything else?




You are making the common mistake of taking your own situation and that of your little circle of friends and thinking everyone is the same.




Like it or not the average FTB age is 36 and rising, so clearly your example is not representative.

I'm in a similar situation.
Approaching 30.
Some reasonable deposit saved
Couldn't afford anything like what we want to... but could afford a fair bit

My wife would like a house, so would I. But I refuse to put our long term happiness (Newsflash: bad financial planning will affect your long term happiness!) at risk by buying into the housing market at a ridiculous point in time.

Buying is only renting off a bank anyway. You don't own the property, you just have the right to eventually own it if you keep paying them. Stop paying your mortgage and see how long you still 'own' your property.

I'll keep renting until its cheaper to buy, or alternatively, if prices don't come down (yeah right!) then I'm off out of this fu**ing dump of a country to somewhere more sane

Buying vs Renting is a stupid question at present. Try finding a landlord who dosen't mind you decorating, that'll take your mind off it

Buying vs Renting is like getting a TV from Rumbelows (remember them?) on HP (Hire Purchase) vs TV Rental. You rent with both schemes, but with one of them you can end up owning the TV at the end of it.
Would you get a TV on HP if it costs significantly more than renting it?

I'm not saying that you do need 100k. There are plenty of places in the UK a person on a decent salary could afford to buy a family house. I accept that London is not like that, but in my experience (I'm 30) it never has been.

Reading this forum are I think 3 types of person.

1) People who own or have owned property. The lucky ones who can afford to move and absorb a "paper loss" on their equity
2) People who have been building a career but have not so far been able to get on the property ladder. These people probably now earn enough to buy a family house on a 25 year mortgage. Yes it may not be cheap but fixed rates are available!
3) People who do not have great earning power and do not own property. For such people, waiting for price falls is the only option.

I feel for the 3's I really do. I was one once myself but they should not preach to the others and tell them they are stupid to want to buy a house to live in. For 1's and 2's a house is a cost just like any other.

People still buy new cars even though they lose 20% of their value a year!

People also jump off cliffs. Does that make it a wise course of action?

ZZ:



Until 19 in higher ed full time. 19-21 got part time job in hospital as I wanted to be a doctor and that was the only sure way of getting into those unis, also took 2 extra A-levels o boost chances. Got into Guys when just turning 21.



I use this to illustrate a point. She's 3 yrs older than me and has stuck buy me when we had NO money and I was living from her income. No she doesn't go on about it all the time, but I'm well aware of all the medical consequences of having kids after 35 and so is she. When you're part of a couple, it's not just about what YOU want you must take the other half into account.

Not taking the views of your nearest and dearest into account when making a decision (whoever they are) must make you a very selfish and childish guy ZZ. Perhaps you might grow out of it soon before you end up sad and lonely.



Mmmmm. . .most people still cannot believe a crash is coming, they are sadly the deluded majority, but they are none the less a majority. You wouldn't perhaps be making the same mistake by taking the views on this small forum to be the norm? Surely not ZZ



As has already been said this there are those who simply cannot buy and this will push up the age bracket. But simply saying that the average FTB is now 36 is NOT an argument that people are still not looking to buy, it's just that many can't. My 'small circle of friends' is luckily of the higher income earners and so they can afford to buy and do so. Highly representitive of that bracket I would think.

However, ZZ you do seem to have you head stuck up your rectum when it comes to how people behave. I am simply saying that there is still a section of the populice who will buy regardless of whats happening to the market. They're not stupid it's just that in the same way as we have forced sellers there are forced buyers also.

Is it really that bad? Most people go on as if having a child after 35 for a woman is impossible/practically a death sentence for the child.




Where did I say not to take her views into account? You can look all day and you won't find it, cos I never said it.




Uh, where have I said that I consider the views expressed on this forum to be the norm?You can look all day and you won't find it, cos I never said it.




So not representative of FTBs as a whole then?

Nope, but I think it extremely bad to dash someones dreams for the sake of cash. How do you think you'd feel if your wife held back from having kids because you wanted a house a few thousand cheaper. She loves you so she does it for you. Then when you have your first (or second) it turns out to have downs syndrome or some other defect. You love that child so don't you think you might just blame yourself? And you did it all just for cash! OK the chances are very small but would you really want to take the risk if you could afford to buy now and weather the storm of falling prices?



Nope but you did more than hint that to buy now would be stupid regardless. That looks pretty much like a single track mind



See single track comment above



Do you honestly believe that the average FTB or the behaviour of FTBs as a whole can be used to say that no FTBs are buying now or should consider buying now? The market has many different subsections and they will all work to different timescales - this is the problem with market prediction in economics. NO FTB is representative of FTBs as a whole, and this average FTB argument cannot be applied to explain much, if anything. The average FTB argument is just about useless in explaining the market. This is 'Science 101' do you really not get this???

What is so bad about having children in rented? Why do you have to buy?



Exactly.



Yeah, the old negative-equity-doesn't-matter-as-long-as-you-can-afford-to-buy argument. Problem is, most FTBs can't.



This comment in no way rebuts this:





Again, yet another comment that I have not said.




Which is what exactly? You are responding to points that I have not made.

Most FTBs can buy it just takes a little imagination and creative thinking.

There are loads of areas left where flats are under £100000 (Kent, Essex, Hants, Suffolk, Wilts, Berks, Bucks, Herts and so on). A £100000 mortgage will be c£80.00 per week interest only or £120.00 per week Capital repayment.

They can rent out one of thier bedrooms to help or get a second job (like my parents had to when they bought). ITS NEVER BEEN EASY, EVER.

The bears have got it all wrong.

Dont pay someone elses mortgage , pay your own, decorate and move walls without worry of being thrown out after 6 months.


Take advantage of the many vendors who cant find an Xmas buyer but who have themselves committed or even already moved.

You dont need load of money to have a great life, kids, fun etc. Once you've got em why not enjoy the kids, why go to work a worry about mortgage payments etc let your LL worry about that.

Id love a bigger house to live in for the five in our familly, but living in a hovel, sorry I mean small cottage means we spend a lot of time together, not on our own escaping each other. With little kids, babies and the like, they are always getting themselves in dangerous situations, in a small place its easy to keep an eye on them.


What you need is

1. Nice places to walk round nearby i.e. woods, park etc
2. Community kind of place with playgroups, parent/child groups, friends etc.
3. Garden
4. Good car boot sales etc for toys
5. One night a week and maybe a day when you can get out and do something totally different, i.e. sport, art, socialising etc
6. Time & Patience & Love

Almost free in fact!

CP

Your figures are wrong.




Remind me again the point of buying if you have to live with strangers? Sounds like renting to me, without the flexibility.

Security in ownership. Ever heard of repossession?

Buy a £100k flat now and prices fall 20% the lender can say "please pay the £20,000 difference between what our security (the house) is worth and the loan you have secured on it."

"Oh you can't pay the £20,000 OK we'll sell your house from under you and then chase you for what's left FOR THE NEXT 12 YEARS if necessary."

Boy that would make me feel secure.

Dogbox essentially you are saying Ownership good at any price, renting bad at any price. That just doesn't make sense. If buying costs more in interest than renting, buying is the worse option, and so almost nowhere in the UK is worth buying at the moment.

Oh and by the way if you buy somewhere in Kent for £100k anywhere near a transport link you won't be able to rent out a room unless you like sharing your bed with your lodger.

I must admit I have never for 1 second consdiered renting, its a concept totally alien to me.
As for negative equity my brother handed keys back in last crash owing £50000 negative equity. The lender recently 'out of the blue' sent an invoice for the full amount (10 yrs later).

He shat his load there and then as he now owned another home with lots of grabbable equity and a family reliant on him.

He wrote to them and said he was broke (which he couldnt prove) and had kids etc. They settled for £2500 - and I absolutley promise you this is the case. ZZ will never beleive me.

If and only if, there was a catastrophic economic jolt (like 16% interest rates) I would rent and wait. I say buy now because you can pick up a forced bargain but I dont see this opportunity persisting much into 2005.

So all you bedwetting tenant types need to buy.

House prices will be falling by 10-15% pa? I take it you can predict the future along with a number of other bears here. What will the next lottery numbers be?




When people say they are going to get their 'own' home, and they need to borrow to do that, it is simply just an expression. Why do people on this forum get so hung up about people saying they want to own their own home?



Funny how when a bear talks about how well off they are, none of the other bears complain in the same way that they do when landlords talk about being well off.



It took two posts to this thread for zzg to resort to name-calling.



Perfectly sensible, if money is your main concern.



I have a feeling that this concept will be a little lost on zzg.



Who does that remind me of zzg?



What makes you the judge of whether people's actions are wise or not?



How do you know that most FTBs can't afford to buy? You don't know every FTB's personal circumstances do you?



Buying is the worse option from an economic point of view - trouble is, not everyone wants to rent. I would guess most people would rather buy rather than rent if the cost was same.

In any case, I thought the original point was that Sonny was going to buy in 12-18 months time? A lot of bears here say that prices will have already bottomed out by then as the crash apparently started months ago.

No idea BA. Who?



The OP's implication was that because people buy new cars, this is a sensible course of action, even though they lose 35% of their value as soon as they are driven off the forecourt. The "jumping off a cliff" analogy was intended to demonstrate the inaccuracy of this implication. Just because people do it, doesn't make it the right thing to do.



FTB's are like other people; the average FTB will earn around £23k, and unless you submit a fraudulent mortgage application this does not go very far in the current housing market.

Dogbox wrote:

"So all you bedwetting tenant types need to buy."

F*ck me I'll be off to the estate agents in the morning. What brilliant argument.

You're brother has committed fraud to avoid a debt acquired by purchasing a house at the wrong time, and you would never consider renting?

Think about what your saying. Now your not only saying "renting bad, owning good", your saying "renting bad, owning good, and if owning doesn't work out commit fraud to avoid your liabilities".

That's a good way to avoid having to pay interest on a mortgage or rent - commit a serious crime and go to prison and live rent/mortgage free. Absolute genius Dogbox.

Come on I welcome bullish argument, because without it there is no debate, but you have to be able to do better than that.

Willing
You are right in one sense- priorities are important. If you want a home and do feel that you will be able to afford the mortgages, yes, you should take the plunge. Do not look at the consequences. If it brings happiness to you and your wife and estate agents and the punters, so be it.
However, you should also remember that you have been warned. The fact is that the house prices cannot remain at this high level for long without first time buyers. I assume you are in Medical profession, which makes you one of the affordable group of first time buyers. But I do not think you represent the majority. Many FTB are not able to afford the deposits or mortgage repayments with house prices running at the present high income multiples. It is not the profits they are after, just being able to buy a home.

The idea that you can't bring up kinds in rented accommodation is complete nonsense. I am married with 2 kids under 3 and we STRed early this year. We had a really beautiful house in London but wanted to move out, and took the view that the market would fall and it was worth the inconvenience of renting (and having to move possibly every year for 3 years) because the next house we wanted to buy would be for 20 years, our dream house etc.

As it turned out we rented a really wonderful house - 5 beds 3 recs 1 acre garden - for a laughably cheap rent (2% gross yield...) which we could not have afforded to buy. The children love it and now we are moving (I'll save that story on the state of the rental market for another time) the eldest says she doesn't want to leave the present house. We've found another place - very nice but not quite so flash - and I'm sure we'll be just as happy there.

My only tip on renting with kids is don't go for a place with new beige carpets....

I'd also like to respond to the other point that has been raised a few times on the forum that women have an ineluctable nesting instinct that can only be satisfied by home-ownership whatever the financial consequences. This is certainly not true in all cases but I accept it may be in some, and if you have married a woman as stupid as this, you have my sympathies because financial ruin is probably the least of your worries...

What is this obsession with age? Some posters on here talk as though once you're past 30 you're knocking on heavens door.

Take 2 scenarios

i) Buy at 30 for £180,000
ii) Buy at 35 for £100,000

80 grand less to pay off (with interest)

I'd plump for (ii).


25 years is a long time to be drowning in debt.

The yield on my house is 2.9% yield. I'm sure its quite common, Can't for the life of me figure why fools are buying now, good on them that what I say keep up the good work, the more they buy the cheaper my rent becomes. Hopefully next year when I renew the contract it will be 1.5%.

In 1985 to buy my 1st property a two double bed maisonette in north london the mortgage was 40% of my sal and I put a deposit down of 15%. I rented one bed out to my sister £45 per week and made the living room into a bed sit and rented that out to a friend who wanted to escape from her parents home £50 per week. We had the time of out lives independance, shared the cooking cleaning etc, luckily the kitchen was a decent size, and we all got on well together. Had a better time than living on my own and the mortgage was almost paying for itself. There are ways to buy your 1st property, although I realise it doesn't seem so straight forward and without risk in todays market.

Whether you belive you can or whether you belive you can't you are absolutely right.

Interesting, the hostility that you get when you simply say you'll wait until next year but then if you can sensibly afford it you'll buy.

What's so wrong with wanting a house as a home NOT an investment? If you can afford it sensibly then why not buy if thats what you want?

Have some of you guys been hanging around BTLs so long that you're starting to think like them?

Or could it possibly be that you are more than a little scared that there are many, many FTBs like me out there? If that were the case a crash might start but then be nipped off earlier than you might expect? ZZ do you really need a fall that far to bring prices into your reach?

I hope not and I hope that you get the fall you want.

But trying to keep people 'on-board with the FTB strike' by posting to this forum will really not make any difference to market at all. Drop in the ocean. But I don't really think even you assume that it would.

Personally, I just want a nice 2 or 3 bed home that isn't rented, and maybe with a small garden. I could afford it pretty easily now in my area but I too think things will fall and probably for the next 2 years. However, unlike you guys I'm not prepared to put my life on hold until they do. At some point you have to make a margin call.



Ok, STR@2%GY that really pissed me off. So before a flame war starts I guess its time to go.

Not only on this forum either. It is a commonly held perception, repeated on this forum and others, that women have an almost bovine "nesting instinct" which causes them to irrationally and hysterically demand the purchase of property at all costs: the image this conjures up is of the female sparrow shrieking shrilly at the male sparrow to build a nest, after which she fluffs her feathers inside the nest built by the male and prepares the nest for the arrival of chicks. I'm afraid I give women more credit than being mindless avian creatures driven in a cow-like fashion by their progenerative urges. Real life is not (or should not be) a David Attenborough wildlife documentary.

I, personally don't want a home as an investment. I want a home that I can afford without eating jam butties for the next 25 years and one that won't depreciate before my very eyes (negative equity). This means waiting for a BIG drop.

I don't want 25 years of soul destroying debt struggle and thankfully I won't have to. The 'price' I pay for that is time. I'm prepared to wait, some aren't.



fair enough, that's your choice.

I find it quite amusing that you get people on this site every so often saying "I think there is going to a crash but I need to buy a house". Why are you on this site unless you think a crash is a posibility. You don't just stumble on this site!!

Basically you are worried about losing a large % of your future house. Everyone can understand wanting you own home and having kids. However I would like to know why you are on this site saying I need to buy? Go ahead and buy and don't worry about appearing stupid for chucking a load of money down the drain. However there are nice rented properties, suitable for kids to say otherwise is wrong.

There alot of people who have kids while living in Rented accomodation, Council Houses, Parents houses. Suggesting that this is no way to bring up a child is in my opinion snobbery and wide of the mark. There are lot more important factors in bringing up a child than living in your own house!

I don't know why you're so pissed off because your finances are healthy, and you say you could afford to buy "pretty easily" if you wanted to, so my comment obviously doesn't apply to you.

Ok this is stupid we now have bears attacking other bears.

This is a tense time, the market will crash let's just wait and see.

If willing wants to buy, that's cool. In his case it seems like a good idea.

You know you can be a bear (even an uber-bear like me) and not want to bet the whole plot on a crash. I'm not here because I'm an FTB or an STR or anything. I just find this site interesting! I'm not about to STR because of my views (apart from anything the wife would kill me )

People are different, people view differnt things as important.

Jesus, lets stop the whole "if you're not with us you're against us" feel to this thread and get back to the crash!!