feeling depressed about SE London house prices

[SarfEasticated]

They just keep going up and up near me, last year 3 bed house needing work went for £310k, this year same house over the road went for £410k in one day. so as soon as anything comes on the market it is sold immediately. The bank suggested we should only really borrow up to £350k so we don't stand a chance of finding anything in our budget now near our daughter's school. I really don't want to move so far away we have to get a car to take her there and back. I want her to live near so we can have play dates after school etc.
Please advise, are the prices ever going to go down again, or do we need to try to buy now and just borrow a lot more than we could afford if the interest rates went up to 1980's rates.
HELP property gurus.

YOu could always buy now and get a mahoosively long fixed-rate deal, say 10 years. Co-op have a 10 year fix, 75% LTV at 5% according to moneyfacts.

Of course it's mad mad mad to borrow large amounts but hey, it's London, and I am not sure they are ever going to crash around here. For 6 years I was a believer in an imminent house price crash. It never came and there we were 6 years down the line, £60000 worse off from paying rent, and prices had gone up even further.

Our mortgage payments eat up around 35% of my DP's income each month (I am on career break at mo while kids are little) but we were comfortable with this because I am going back to work in October.

Rather than push yourselves too high now, could you get by with buying a 2 bed in the area for your budget, and then in a few years when hopefully the economy is more stable look to taking on more and getting a bigger house.

At least you will be on the ladder and the 2 bed will be going up in price with the others and you are paying some mortgage off rather than just renting?

I'm oop north so might be wide of the mark with 2 beds in the area, so sorry if I am!

I don't think they are going to come down any time soon. This area seems to be recession proof in terms of property prices. My friend just sold her flat within a week of it going up for sale, and it wasn't priced particularly cheaply either. I think I would take a gamble and borrow what you need; but then I'm not particularly risk-averse when it comes to property - I guess gambles have always paid off for me [dumb luck]. Or could you consider squeezing into a smaller house or flat?

Have you tried Eltham, Bexley, Sidcup, Bromley?

We own a 2 bed flat here already, but my DD's room is too small for a single bed, and she is growing out of her toddler bed now. No scope for extending either. We do need to move though and should sell our place pretty quickly for £250K, I just don't want us to overstretch ourselves just in case on of us loses our jobs IYSWIM.

I don't want to move out of our area NT as we have a nice network of friends with children, and DD will start school in September...

Buy a 2 bed with scope for extension?

SS&S Even they are £370k!

What about selling up and renting for a bit?

The only other thing is putting DD in your room and sofa bed in front room and using her old room as storage/ dressing room.

I don't know where you are but many children attend schools a few train stops away... But I know that's not ideal.

are there any new builds going up in the area? buying off plan is normally cheaper I believe

or auctions?

what about a larger garden flat?

If she hasn't started school yet, why not consider moving before she does? There are a number of places in SE Lonfon where you can get a 3 bed house for £300 or even less! Try Catford Corbett Estate area. Very good primaries, she will make friends at school and if stay in SE London, you can still keep in close contact with your existing friends.

In order to start school in September we had to apply in January, so too late for us to change that now pippi. Thanks though.

Yes I understand, I just think it's worth bearing in mind that it's not all SE London that is out of your price range, just some bits, including the bit where you live!!

I know! So annoying - blummin east London line!

Ah we moved from E London line area to a non ELL area and got a 4 bed house for a mere 50k more than we sold our 2 bed flat for!

Could you upgrade to a 3 bed flat in your block or even just a bigger 2 bed? I have sympathy as we are in a similar situation (and our 2 bed would sell for only around 220 ) and am pretty depressed at how much a house now costs anywhere near me in SE London but I reckon being in a 2 bed flat (thankfully big enough for 2 cots!) is the compromise for wanting to stay in the area.

I grew up in Lewisham and have fond memories of The Lewisham Centre and Cheesemans department store in In 1970's!

I boggle at the house prices! My dad use to drive through South London turning his nose up a Clapham, Balham etc, which were pretty run down in those days"who wants to live in Victorian sprawl,"

Er quite a lot of people, dad.

Lionelblairs My FIL was appalled when DH and I moved into our first place together in between... Brixton and Clapham North. Used to say he would never walk down that area by himself 20 years ago... Now, it's highly desirable!

SarfEasticated Could you tell us whereabouts you are looking? I don't think house prices will come down in London, especially in family-friendly areas with good primaries. We just moved to a part of Lewisham to a very desirable area with 3-5 very good primary schools around us and a house down the road from us (long road, one end nice, going down to the other, not so nice!) just went up on the market for what we paid for our house. Granted it won't sell for that but it's a lot smaller (no loft conversion and no extension) and nowhere near as nice.

We were lucky that my parents loaned us some money so we could get together the deposit we wanted but we still have a shockingly high mortgage. Makes me nervous but DH is fine with it. We are glad we went for it and stretched to get this house, it's something we can stay in forever now. I don't think interest rates will go beyond 6-7% in the next 5 years, so you either fix your interest rates for 10 years at 5% (like someone suggested here) or take a tracker and risk it, just make sure you wil still be able to pay the mortgage if it hits 6-7%. We are on an interest-only mortgage but overpaying every month with the view that we can stop the overpayment and just pay interest-only if rates skyrocket.

Ahh so the consensus is that there won't be a drop in house prices? Boo! According to the paper yesterday, lots of Europeans are buying in London as a the pound is weak and it offers them a secure investment.
We'll just have to borrow more and hope our jobs are secure.

Where in se London are you?

Se4

Me too! Are you looking at gordonbrook?

There are still houses for around £359k it just depends what you are looking for. You're right the Victorians cost a bomb (and not worth it in my opinion) but the 1930's houses on henryson, elsiemaud, chudleigh, etc aren't as expensive and ate great family homes with good size gardens.

Have PM'd you IFL