Buying a house in this market.

[cakelover75]

Hi everyone,
My first post in mumsnet!

Just after a bit of advice and people's opinion please :)
Our flat has been up for sale for a couple of months but we haven't had any interest in it. We have also saved up money as well towards a deposit for something bigger.

We are really cramped for space as we have an 8 month old baby and my OH needs to work from home (so the 2nd bedroom is his office).

Seeing as we can't sell the flat we are thinking about renting it out instead (have done this before) but this leaves us with a smaller deposit. This also means that we can't buy the house that could technically be our 'forever house' and may only do us for another 5 years tops.

Our other option would be to rent something bigger while still saving and then buying when (if) prices have come down even further.

So, with that in mind, do you think it is wise to buy a house for a shortish period in mind with house prices predicted to keep falling, or do you think we should rent something else.

Am in a pickle about this!

Thanks

It depends what stamp duty category you would fall into in your area - if it's going to be 3 or 4% then I would say hold out for a more permanent home (unless the in-betweener is a real bargain or you think you can flip it easily). I think prices are going to come down so, if you've already got a decent deposit, I would consider renting out your home and finding somewhere to rent yourselves - especially if you are looking slightly out of the area you currently live in (you can see how much you like the new area, set yourself up to be close to a school you really like etc). But, given the experience of a lot of renters on MN, stipulating a 18- or 24-month contract so that you don't find yourself without a home 6 months down the line.

HTH

surely renting makes financial sense in the current climate?

depends where you are though - I doubt prices will fall in the southeast & London the way they will in the north.... I am always amazed when I see discussions about house price which go on for pages without anyone mentioning whereabouts in the country they are!

If you are trading up a falling market is your friend, its the time to trade up. If your house hasn't sold in a couple of months you need to think about why it hasn't and ask the agents. Maybe by using the 2nd bedroom as an office buyers can't see it as a bedroom. Reduction in price is the obvious.

If you are in a position to buy at the moment I think you are in a very good position.

If I were you I'd work out your budget then go to every agent in the area you want to buy in and ask about the houses above your price range that have been on the market for ages.

You may find somebody who is desperate to sell and who will drop their price substantially.

I think you should rent something bigger and wait

Hi everyone,

Thanks for taking the time to reply.
To answer a few questions, we're in the west of Scotland.

We could drop the price but I've spoken to others in the same boat as well as the estate agent and the answer is that this is a 2 bedroom flat probably suited for first time buyers who can't get a deposit. The only properties that are selling round here are houses (especially 4 bedroom ones). So we could drop the price but it wouldn't help us get what we want.

I am inclined to agree with those who say that we should rent somewhere bigger and then wait and see if prices drop further, or wait till something suitable comes on in the area we want.

In the short term, could your DH rent an office somewhere close by? Perhaps even a spare bedroom if one of your friends have a bigger house and need the cash? That would take the immediate pressure off. Even paying an extra office rent for a year or too on top of your mortgage might not work out as expensive as the cost of an extra move and would be much less hassle!

Also agree with what jonicomelately said. We dropped our price significantly to sell (about 10% less than similar properties on the market) but then had a pretty low offer accepted on the house we wanted to buy. Fingers crossed we should be moving in the next month or so! Once we had dropped the price, we had loads and loads of viewings and letters through the door since we sold expressing interest if our sale falls through. If yours is the cheapest 2 bed flat, yours is the one that every single person who wants a 2 bed flat will come look at - and you only need one of them to buy it! Have you had a look on rightmove to see what other similar properties are on for? That might help you decide how realistically priced your flat actually is.

Good luck whatever you decide :)