To buy or not to buy...that is the question.(12 Posts)
We've been postponing buying for years now and just as we feel ready to own our house (we have a 9 months little boy) the house market has gone insanely expensive. Prices have gone up by 20% at least in just one year. We are interested in a 3 bed house with access to London, good schools, the usual stuff everyone else is likely to be interested in as well.
The question on our minds, lingering like a dark cloud, is..to buy at this point in time, when the housing market is just so expensive, or to wait a while longer? Is it likely that houses prices will go down in the next years? What do you honestly think?
I appreciate that all you can offer is your opinion, prediction, call it whatever, but I'd like to hear it anyway. Let me hear some thoughts, please! Thanks, ladies. X
Anyone who knew this would become a billionaire. No one knows.
Property has always been a medium to long term investment. It has its ups and downs but over the long term eg 10 years or more it has been a reasonable
investment This is especially so in London and commutable places.
The past is never a guarantee for the future In the mid80's some got stung when the interest rates went high In the 70s they also had high interest rates but because people's loans were much lower it had less impact.
Another main factor is basically supply and demand Prices go up when there is a high demand but low supply. Again in the 70s nearly 50% rented from the State but once 2000 came most had to rent in high priced property in the private sector . This caused pent up demand.The current government is promising a home building programame and taxes on Buy to Let to cool the market down but if we are hit by yet another recession then watch out.
Currently interest rates are low which has been encouraging borrowing.
if the rates go up too much it could cause problems. There are also those people
who took out Interest only mortgages in 2000 onwards - many will be downsizing . You could see demand from them for smaller properties competing with First Time Buyers
I f interest rates go down further then this will be a real problem. Remember Cyprus? More banks will crash but now we the government will not be able to bail them out. The pound will crash, causing economic chaos.
Finally the World situation
One thing I think personally is that there will no steep climb in the next decade
Maybe just 2- 5% per year but i could be wrong
We've thought about buying but it's just so crazy at the mo that l honestly can't bring myself to do it. We're in zone 3 and to get another bedroom is seriously £200,000 more than we paid for our current home
We have dc so I'm glad we're not renting and our home is big enough for us because the current prices are ridiculous. I'm not sure if they can continue to rise but l can't see a crash, more just a stabilising with the current low IR.
@DiggersRest It really is good that you are not renting at the mo, we are and it's really frustrating. Ergo the need to buy something, and the dilemma...
I think things have reached tipping point. Lots of "properties" not moving around here (SW London). I'd sit and wait. Renting from a private landlord or renting from a bank - neither are ideal.
@FrikkaDilla That's very interesting, we also noticed that lots of properties we have viewed months ago are still on the market... Aaaagh, tough one. Thanks X
There could well be a drop if everyone votes to leave the EU. I'd wait.
I'm in north London and houses fly off the market for more than the expected price. We bought 3 years ago and I'm so glad we did as could barely afford a shed now.
But if you can afford it, I would definitely buy, I can't see prices dropping. That's just my opinion though!
Can you afford it? Can you still afford it if interest rates rise?
How does the cost of renting compare to what would be your mortgage payments?
Are you settled in the area, with no thoughts of relocating?
Do you want a home that you can customise? That you can expand?
Do you worry about being turfed out of your accommodation every 6 months?
Do you want stability or flexibility?
Ignore everything else. A property is a place to live. If you're happy with how you're living and can afford it, the value of the property is purely theoretical.
I'm probably in a different situation to you as I'm in the North West, but I would say buy if you can. I'm trapped renting at the moment and can't see how I'll be able to buy any time soon, but it's horrible to think I've possibly nearly paid off my ladlords mortgage! (which I probably have when I add it all up). I don't know what rental prices are like where you are but my rented house costs more than what a mortgage would cost me on a similar property. I just can't save a deposit because I'm paying so much in rent... it's a vicious circle.
So if you can buy, I'd say do it and lay down some roots for your little one. Don't keep putting it off. I have a little girl and I'm approaching the age at which my parents generation had almost paid off their mortgage
Prime London has been crashing for about a year now which will filter down to the lower end of the market.
On top of that, first time buyers have been priced out for years and BTLers have been buying typical FTB properties. Even if the extra 3% stamp duty doesn't put them off, it will have brought forward transactions meaning reduced demand for the next few months at least. BTL as a business model is dead anyway, we're already seeing the effects of Clause 24 - Nationwide have recently upped their rental cover requirements and deposit amount. Re-mortgaging onto cheaper deals is going to get harder and harder for BTL and will make the loss of some of their government subsidy from next April hit even harder. Some BTLers are already rushing towards the exits (check out the number of one and two beds in London with no onward chain) but most of them haven't realised what's happening yet - the market is about to be flooded with BTL properties and the prices are going to have to come down to what FTBs can actually afford to pay.
There are already plenty of stories turning up in the main stream media about how the property market is stalling - there was something in the Metro a few weeks ago about one and two beds in London being down 10% in April after the stamp duty deadline. I'd say that we're already in a house price crash and that it will be obvious by October at the very latest (it takes a few months for rises or drops to filter through into the indices).
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