"More people want house prices to fall than to rise"

[southutsire]

House prices

As a wannabe first-time-buyer obviously I am pleased with the current turn in the market... but am surprised at this. Just wondered if it's really true (obviously MN is a far more scientific barometer than a survey )

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SW15 - 3 bed end of terrace in a conservation area

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Freddy's Teddy - "So, let's say they go into negative equity. Your recommendation is for them to sell at a loss, rent, and try to save for a deposit?"

It is not a reccomendation but people do have options. High house prices are reducing our international competitiveness, and a real burden for young families. I won't respond to your aggressive posts again as you are clearly spoiling for a fight.

Quintessential - I think decisions like that depend on lots of personal factors. In your shoes I might sell and rent, but I think only if I was definitely moving anyway.

I saw a bit of the second part of that BBC programme yesterday - it really made me wonder why they did not make it a couple of years ago?

Upwind, I have already moved out of the house. I am in Norway, doing a self build. The house is only mortgaged at 15% of its value, the original plan was to mortgage the house on a buy to let, interest only, and get tenants in, and sell in a few years (before I have to pay tax on sale) to finance my buy to let. However, it has been two months on the rental market and no offers, bar one. From a GM who wants a 3 year let (obviously securing a rent with an increase no higher than inflation rate) Her offer of weekly rent is so low that it won't pay my mortgage. Other drawback is that I have to pay 11% of agency fees on 3 years total rental income upfront. I declined.

It is difficult to know what to do when the market is so jittery.

That first bit makes no sense at all:

Upwind, I have already moved out of the house. I am in Norway, doing a self build.
The house is only mortgaged at 15% of its value, the original plan was to remortgage the house on a buy to let, interest only, and get tenants in, and sell in a few years (before I have to pay tax on sale) to finance my selfbuild.

I am too tired to be coherent.

QS, I still think personal factors are relevant - is there any chance you would want to return to the house?

I am amazed that the rent might not cover a 15% mortgage & suspect that means the house price is extremely expensive, making it not a good option for renting out.

no sorry I wasnt clear, we are remortgaging to a buy to let interest only to free up a couple of hundred thousand to finance the self build. So we are increasing from 15% to around 70% mortgage cover on the house

We might want to return to the UK, but I doubt I want to return to that house, it is a little inconvenient for schools. Dont get me wrong, there are good schools around, but those are either private or state schools. Our son went to a very good RC Faith school a bit further away, and think I want to move closer to that school if we come back.

Upwind, hope you don't mind me asking, but what is your situation re: housing. How come you can't afford to get on the property ladder, is it a generational thing do you think, or you young and missed the boat?

QS - I think that situation is complicated and you need real financial advice, maybe from a financial advisor?

MM - you are right, we missed the boat. We actually both have above the median earnings and if we had been in a position to buy before prices went crazy we would be much better off. With hindsight I should have dropped out of university and jumped on that ladder!

I suppose people like me in their late twenties and younger are very sharply aware of the house price boom because those just a few years older are relatively much better off. I still find it amazing the media have, until recently, been so gleeful about house price inflation. Renting in the UK can be very difficult for families.

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Chequers, I don't expect our housing situation to work out anytime soon. But I find it amazing how so many older people are surprised we can't afford to buy. How high do they imagine median earnings are?

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We were determined to buy before starting a family but when we slowly realised the only places we could buy were evidently unsuitable for families we decided to go for it anyway. I am so glad we did because it turned out we needed assistance. The process has been a nightmare and I can't imagine how much harder it would be if we had waited another 5-10 years till we could afford a family home.

There will be a lot of anger and heartache when it finally sinks in how badly younger generations have been affected by this. I think the Labour party will be the new "nasty party" and can only wish there was a decent alternative!

I think and hope lots of you will be able to buy soon.We are viewing places atm and on monday the first maisonette we were viewing someone knocked on the door half way through and the agent told us it was another viewing.When we came out there was a girl sitting on teh steps and as we walked away we knew she was a friend of the agents as she thanked her for helping her out .It was an attempt to make it look like it was in demand.We then viewed a house with a different agent and she said there was a viewing after us but as we drove round the block to look at the area we saw her walking back to the office.She phoned me yesterday afternoon and said there had been one offer and I told her that was fine as we have others to view.She has left 3 messages for me today so obviously it was all lies.We don't know what to think tbh so you can see the agents are getting desperate and they know what is coming next.I would love to see my little brother and his girlfriend get somewhere decent instead of 1 room in clapham wjich is 750 a month!!!

In 1984 it cost us £40k to buy a 3 bed terraced. My salary was £7500 and £10,500 the next year and my ex husband's £7,500. Those houses are now selling at £260,000 and my ex's teacher salary would now be £30k. - So his pay up x 4 in the 23 years. House price up x 9. BUT in my field and what my daughter will earn the equivalent wage now is £35,000k or so and then £65k in year 2. So I think it does depend on whether you're in work where salaries have kept up or not and also interest rates are still a lot lower than we were paying.

2.5 x our wages in 1984 bought the house. Now it's 3 times those wages. Not a huge difference but if instead it had been two teachers' wages £60,000 x they need 4.5 those wages to buy it. Still not an impossible task really. But it does illustrate why it might be wise for parents to direct children into reasonably lucrative careers. Daughter 2 is now decided as well. That leaves the son who graduates next year.

On whether to keep the buy to let depends if you're likely to return to the UK and want to have kept in the UK market and if it will be lettable.

Upwind and chequers. I agree with your sentiment. ALthough the older generation will claim it was always hard to get on the 'housing ladder', they will never acknowledge how much difference the change in house prices has made between very small sections of a generation.

It turns out that for us, when you bought your house has more effect on your wealth than your career, your education, your earnings.

But I have to agree with earlier posters - there is more to life than housing. I became obsessed with the issue to the extent of almost ruining my life over it. I now live in a flat and I am happy. I have an allotment for garden space and I make of life what it offers - not what I want it to offer. It works for me.

Well, I am out of the predicament, for now. Found tenants for my house, a family with 2 young children (as opposed to the 4 people sharing possibly with partners that was suggested by agency) on an 18 month lease. The rent is not as I hoped, but will cover the mortgage and insurance. Hopefully in 18 months time it will again be sellers market (selfish me) or at least less of a slump and I can sell with a little profit. And with tenants covering the mortgage on this house, we will be mortgage free (!!) and the equity released by London home is financing the self build in Norway. Piuh! Fingers crossed it is as good as it seems (I could do with a bit of luck in all the bad things going on at the moment), and I hope everybody else comes out on their feet, too.

But house prices in London has been extortionate for years, and it is a shame that key workers and normal folks cant afford to buy homes in the capital.