If you have bought a house for way over its true market value in the last few years..

[withdeanwombat]

A hate to say this but I do not think prices will drop. Its all supply and demand, the demand still greatly outweighs the supply and whilst that continue's and interest rates are relatively low and mortgage payments are within relative affordability levels ( yes interest rates have gone up 9 times since the 3.50% low but 5.75% Bank base rate is still historically very low and average mortgages are only 30% of net earnings whilst they were nearly 60% in the 80's ) the demand will ensure property prices will stabalise. Also the disasterous and meaningless HIP's this Government brought in will see a further reduction in the supply of 3 and 4 bed houses.

You put some complex stuff into English,which is good.

Won't sellers merely add a couple of grand to their asking price to cover the HIPS?

 

[Cian]

That completely disregards that fact that a very large number of people in Sussex don't work in the city or earn a huge amount of money - my bonus last year was £400.

Say, for example, I wanted to buy a one bedroom flat in Haywards Heath for £134,950 (as one down my road is up for) and assuming the unlikely event that I had saved enough for 10% deposit, the mortgage repayments would amount to approximately 90% of my monthly salary. I can't say I view that as affordable.

Based on that, I'd have to say you wouldn't be able to afford a house/flat pretty much anywhere - assuming a loan of €180,000 (same as that converted to euro, minus 10%), I have IIB willing to offer me said hypothetical mortgage at a rate entierly affordable on my salary. And I'm 20!

 

[Simster]

That completely disregards that fact that a very large number of people in Sussex don't work in the city or earn a huge amount of money - my bonus last year was £400.

Say, for example, I wanted to buy a one bedroom flat in Haywards Heath for £134,950 (as one down my road is up for) and assuming the unlikely event that I had saved enough for 10% deposit, the mortgage repayments would amount to approximately 90% of my monthly salary. I can't say I view that as affordable.

Saving 5% ought to be attainable I'd have thought?

It sounds as if that flat is likely to sell for £130,000 which would leave you needing a mortgage of £123,500

Over 25 years at 5%, that is £730 per month - I'd say that was quite affordable for many people below the national average salary.

 

[Dave the OAP]

am I allowed to whisper that my mortagage finishes next october........

 

[British Bulldog]

am I allowed to whisper that my mortagage finishes next october........

Well done Dave, Should you start to miss paying a mortgage feel free to start paying mine for me.

 

[Grendel]

Saving 5% ought to be attainable I'd have thought?

It sounds as if that flat is likely to sell for £130,000 which would leave you needing a mortgage of £123,500

Over 25 years at 5%, that is £730 per month - I'd say that was quite affordable for many people below the national average salary.

It depends how you term affordable. Yes, I could pay out £730 a month but by the time you've deducted bills (assuming they'd be pretty much the same as what I'm paying now), car running costs (Tax, MOT, service, petrol etc.), council tax and food, I'd be left with £20 in my pocket at the end of every month to cover any eventuality that may arise.

Frankly, I'm far happier paying what I am in rent a month and having enough money for a couple of bevvies every evening, the odd football match here and there, a game of golf every so often and putting some money into my savings account.

 

[Tesco in Disguise]

i pray nightly that the housing market will come to an almighty crash, people who have bought-to-let will be absolutely f***ed, and young workers may be able to one day own their own home.

 

[British Bulldog]

i pray nightly that the housing market will come to an almighty crash, people who have bought-to-let will be absolutely f***ed, and young workers may be able to one day own their own home.

I feel sorry for youngsters trying to get on the housing market these days, What hope have they got?

 

[Cian]

I feel sorry for youngsters trying to get on the housing market these days, What hope have they got?

To hold on for a few years until the market has bottomed out and jump in then. And while interest rates are rising, I'll continue to be making decent enough returns on what I have in the, erm, Northern Rock :gulp:

 

[London Calling]

Housing in the south east has never been affordable for first time buyers without help.

My brother as a electrician bought his first house in Brighton aged 20 around 1978.

Brighton was ok then for first time buyers, it had a good supply of private and council rented accomadation. London was a bit pricier then, but you could still buy in the good areas and definately in the poor areas. Our house in Hackney was valued at £2000 in the early eighties, other areas of Hackney were cheaper!

Only the housing boom of the 80's radically changed the south east housing market, where for the first time people looked at houses as investment property and not homes. And parallel with this was the reduction of public stock through the right to buy and the combined major reduction in new builds.

It is in the interests of housing developers to minimise new stock, thus retaining high land values and expensive stock. It means they make maximum profit for low outlay. We are seeing flats around hackney selling for £300,000 identical to the next door Council flats where tenants are paying £80 per week?

The south east market will not change until new build outstrips supply, this will eventually force down house prices but which party would go down that route?


By the way we did not own our house when it was £2000 but its worth 100 times that now!

LC

 

[hans kraay fan club]

i pray nightly that the housing market will come to an almighty crash, people who have bought-to-let will be absolutely f***ed, and young workers may be able to one day own their own home.

Thanks for that.

What about the other 'young workers' who have scrimped and saved and worked their arses off to afford a nice house for their families, who would also be 'f***ed'?

Shall we just consider ourselves 'collateral damage'?

 

[Lokki 7]

i pray nightly that the housing market will come to an almighty crash, people who have bought-to-let will be absolutely f***ed, and young workers may be able to one day own their own home.

I thought the point of prayer was to wish goodwill on your fellow man. What a sad bitter and twisted man you must be.

 

[Cian]

Thanks for that.

What about the other 'young workers' who have scrimped and saved and worked their arses off to afford a nice house for their families, who would also be 'f***ed'?

Shall we just consider ourselves 'collateral damage'?

Arguably, negative equity only affects you if you want or have to move, so not everyone who is in the shit as a private home owner is going to be "f***ed" as Simster puts it. But those who had multiple houses as investments are going to be far more hit.

 

[British Bulldog]

To hold on for a few years until the market has bottomed out and jump in then. And while interest rates are rising, I'll continue to be making decent enough returns on what I have in the, erm, Northern Rock :gulp:

I worry about my kids when they want to make they're own way in life, I'd hate to see them throw away good money on rented accomodation but unless they end up in well paid jobs how the hell can they even think about buying?

 

[Bozza]

Thanks for that.

What about the other 'young workers' who have scrimped and saved and worked their arses off to afford a nice house for their families, who would also be 'f***ed'?

Shall we just consider ourselves 'collateral damage'?

Why would you (and I for that matter) be f***ed?

As far as I'm concerned, my house is a home (and not an investment). As long as I am able to continue to pay the mortgage, it doesn't really matter if the property market crashes (whatever crashes happens to mean) - I'll still have the roof over my head. The British obsession with property prices is somewhat bizarre, I think.

 

[hans kraay fan club]

I understand all that Bozza, of course.

It would still make you pretty uncomfortable though, if all of a sudden your home was worth £50k less than you still owed on it.

 

[dylan_bha]

So can any of you financial bods tell me what would happen to my NR mortgage and car finance if the company went bust? Would they take possession of my house and car to pay off their debts? Or would our mortgage and loan just be written off?? - Best and worst case scenario.......

 

[Bozza]

I understand all that Bozza, of course.

It would still make you pretty uncomfortable though, if all of a sudden your home was worth £50k less than you still owed on it.

I understand that, but I think that's only because of spiralling property prices and how we have become accustomed to watching a nest-egg accumulating around us.

 

[Cian]

I understand all that Bozza, of course.

It would still make you pretty uncomfortable though, if all of a sudden your home was worth £50k less than you still owed on it.

My car is worth less than I paid for it and if I got it on finance would likely be worth less than the outstanding debt.

Ditto computers, televisions, whatever people get on Dixons finance deals these days.

Theres no unwritten or written rule that housing has to be an appreciating asset....

 

[Lokki 7]

So can any of you financial bods tell me what would happen to my NR mortgage and car finance if the company went bust? Would they take possession of my house and car to pay off their debts? Or would our mortgage and loan just be written off?? - Best and worst case scenario.......

In a word, nothing. Even if the company went bust, it's assets (including the money you owe) would be bought by another bank so you will not be affected. The losers are the shareholders.