First time buyers

[Uncle Spielberg]

I would agree with that. Very shortly it will occur to the banks in a flash of inspiration that there if they don't lend their money out they won't make any profit. As long as they are realistic with their status checks they will be able to sell a lot of 90% mortgages significantly over the base rate or even LIBOR without pricing themselves out of the market or causing problems for borrowers to make the repayments. And with prices being low at the moment the potential of people running into negative equity who buy now is much lower than it was.

We may or may not be at the bottom of the market but the way to make money is not to wait till the absolute bottom, because you won't know where the bottom is until prices have risen again. If you can buy within 10% or so of what turns out to be the bottom of the market you will have done well. If you wait and wait until you are sure the market is at the bottom you will almost certainly miss out as prices start to rise again, bearing in mind it takes at least a couple of months to buy a house.

So I would doubt that the market would have much further to fall. But that wouldn't stop me making a silly offer if I was looking to buy a house. You never know, they just might accept it.

That is a spot on assessment. the trouble with the people playing the waiting game is that is that when the narket turns and prices start rising vendors will possibly not honour the agreed prices and could play the " the market has gone up in the 2-3 months of the sale going through and we want an extra 10 grand game ". Anyone who buys now and considers it a 5 year investment is onto a winner now imo.

 

[Uncle Spielberg]

They are still way too expensive for ftbs to even contemplate

average houespirice is still around 10x the average wage

I doubt it. First time buyers even with a modest 30k joint income could get a 2 bed flat or house for £ 160k easily now, around 5 x income. Average wages of £ 45000 joint incomes and it is 3.5 x joint incomes. Where do you get 10 x income ?. House prices per income ratios are their lowest for over 5 years.

 

[seagulls4ever]

The value of a house and what someone is prepared to let it go for are two very different things.

 

[Uncle C]

I doubt it. First time buyers even with a modest 30k joint income could get a 2 bed flat or house for £ 160k easily now, around 5 x income. Average wages of £ 45000 joint incomes and it is 3.5 x joint incomes. Where do you get 10 x income ?. House prices per income ratios are their lowest for over 5 years.

Income is still a long way short of the historical 3 - 3.5 times income.

The way you talk is very reminiscent of the scenario that got the world in this mess in the first place. People should at least consider the possibility of high interest rates in the future (to curb the inflation brought on by quantitative easing).

Where will they be then, when they are mortgaged up to the eyeballs?

 

[Uncle C]

The value of a house and what someone is prepared to let it go for are two very different things.

What someone is prepared to pay is also hugely important.

 

[Mr Burns]

This not right. Buy to lets and people re mortgaging at the end of deals will find their payments MUCH lower now as the SVR is so low. Why do you think they will have a massive increase in payments ?.

Okay an example. This one I know off, but I'm sure there are thousands like it.

£220k mortgage through a brooker on £220k property 2 or 3 years ago on fixed mortgage. Had to "self cert" ie lie about income to obtain property.
Needs to remortgage, can only borrow 80%. House is now valued at £180k, ie can only borrow £150ish so is about 65-70k short. Changed jobs, and has no fixed regular income, so needs to self cert again. Brooker who 3 years ago was as welcoming as can be, now "can't help you. Bye"

So people who have had there buy to lets, or even property they lived in for 7-8 years, and have a say £150k mortgage on property worth say £180 will properbly be thinking about getting out and at least getting some money back. Bearing in mind thousands flocked to the easy money schemes that buy to lets were at the time, many used the equity in their houses to get the deposit to buy-to-let, so will they risk everything, or get out now while they still show profit?

If its your home, like in the case above, it gets repossessed. People that were stupid enough to do this in the past couple of years are f***ed.

If this happens widespread, which is slowly happening, people will panick, and there will be a flood of properties on the market, and I think this is where the prices will plumet in a short space of time.

Not forgetting mortage rates are 0.5% and cannot stay at this rate for long. Its a quick fix, that will have to be paid for later.

 

[fairy cakes]

Surely we are still in a recession and we haven’t even reached the worst off it yet. Unemployment is still pretty low compared to the main European countries. UK is 6.5% (I think), Germany is 8.5% and Spain is 15%.

At some point we will probably go off to the IMF for a loan. I'm thinking of buying a house just after Christmas with a sizeable deposit.

 

[Tom Hark Preston Park]

Would have thought a first time buyer could now get an excellent deal on the glut of new-build flats being built in places like Manchester and Brighton. The basic price might not come down a lot more, but the developers will be forced to chuck in a whole host of incentives.

 

[folkestonesgull]

We are an existing nationwide customer

 

[seagulls4ever]

What someone is prepared to pay is also hugely important.

Quite. The point I was trying to make is that whilst house prices have dropped, people are not necessarily willing to let them go for what they are currently valued at.

 

[Uncle Spielberg]

Okay an example. This one I know off, but I'm sure there are thousands like it.

£220k mortgage through a brooker on £220k property 2 or 3 years ago on fixed mortgage. Had to "self cert" ie lie about income to obtain property.
Needs to remortgage, can only borrow 80%. House is now valued at £180k, ie can only borrow £150ish so is about 65-70k short. Changed jobs, and has no fixed regular income, so needs to self cert again. Brooker who 3 years ago was as welcoming as can be, now "can't help you. Bye"

So people who have had there buy to lets, or even property they lived in for 7-8 years, and have a say £150k mortgage on property worth say £180 will properbly be thinking about getting out and at least getting some money back. Bearing in mind thousands flocked to the easy money schemes that buy to lets were at the time, many used the equity in their houses to get the deposit to buy-to-let, so will they risk everything, or get out now while they still show profit?

If its your home, like in the case above, it gets repossessed. People that were stupid enough to do this in the past couple of years are f***ed.

If this happens widespread, which is slowly happening, people will panick, and there will be a flood of properties on the market, and I think this is where the prices will plumet in a short space of time.

Not forgetting mortage rates are 0.5% and cannot stay at this rate for long. Its a quick fix, that will have to be paid for later.

They would go on the SVR which is most likely to be less than the fixed rate they were on.It is not the brokers fault there is not enough equity anymore. Come on. The broker is right he cannot re mortgage them. I think you are barking up the wrong tre and if the broker " lied " so did the clients so its a bit rich laying all the blame with the broker.

 

[Notters]

Still no chance for me

 

[folkestonesgull]

Uncle S is right - they would just go onto the svr and pay less, providing the base rate stays low and their mortgage wasn't capped at at a crazy rate - the drop in house prices will only impact on them if they remortgage or sell - this is why loads of couples who have split up now have the indignity of living together.

 

[The Spanish]

I have just bought a gaff that was asking 110k higher at christmas than what he has just taken for it. cut my throat selling mine now so swings and roundabouts.

 

[folkestonesgull]

I have just bought a gaff that was asking 110k higher at christmas than what he has just taken for it. cut my throat selling mine now so swings and roundabouts.


I think thats what will happen to us - 25% drop on our value and hopefully a 20 -25% drop on the property we want to move to (if and when we find it). The only loser then is the bank as the actual amount of money borrowed will be less.

 

[Taybha]

Makes me laugh when you hear people who bought their houses for 50 grand 20 years ago that are now worth 350k saying its criminal it was worth 375k a year ago! My heart bleeds for you

 

[The Spanish]

Makes me laugh when you hear people who bought their houses for 50 grand 20 years ago that are now worth 350k saying its criminal it was worth 375k a year ago! My heart bleeds for you

i6ts not usually the people who done that that are the property bores to be fair. if they have pitched up in a family home for 20 years its obvious a fast buck was not their intention. its all the wankers that buy and sell houses every couple of years that are the real bores, they are like teenagers who think they are the first ones who have ever done sex and drugs.

the SE property boom has f***ing partly ruined Brighton, in my opinion.

 

[Taybha]

i6ts not usually the people who done that that are the property bores to be fair. if they have pitched up in a family home for 20 years its obvious a fast buck was not their intention. its all the wankers that buy and sell houses every couple of years that are the real bores, they are like teenagers who think they are the first ones who have ever done sex and drugs.

the SE property boom has f***ing partly ruined Brighton, in my opinion.

yep that is a fair point perhaps its not too late for me to go edit b4 it says last edited at the bottom

 

[The Merry Prankster]

The way you talk is very reminiscent of the scenario that got the world in this mess in the first place. People should at least consider the possibility of high interest rates in the future (to curb the inflation brought on by quantitative easing).

Where will they be then, when they are mortgaged up to the eyeballs?

Exactly. How long will that last? Jesus Christ are people in the finance industry really that dumb or don't they care as long as they get another couple of years with their snouts in the trough. Line the whole f***ing lot up and shoot them.

 

[Westdene Seagull]

They would go on the SVR which is most likely to be less than the fixed rate they were on.

It's worked for me x 3