To buy or not to buy...

[doodle 10]

Well we are classed as first time buyers (sold up last year and moved into rental in a new area, came back as new area was pants and renting here until we find a new house). We are keeping an eye on the market, but we won't be buying just yet, as we think, why buy now when we can get it cheaper. We might even be able to get a better house for our money. House prices are coming down, people have reduced the prices, which was unheard of just a few months ago. There's even ad's in the property paper, with owners near enough begging you to come and view their houses on open days.

[frankief 10]

Quite true doodle, and hopefully it will put paid to the Sheffield estate agents rigging of the local market. 'sealed bids' and 'offers over' will become a thing of the past.

Incredibly there are still some members on the forum who believe that the forthcoming UK house price crash will not affect Sheffield! Maybe they have vested interests?

[Phylis 10]

People who are desperate to sell for one reason or another are dropping their asking prices but this is a very very small percenatge of all of the properties on the market. This happens every year in the run up to christmas. Once christmas is over and spring is in the air the proerty market picks up again. It happens year on year.

 

Lets look at the worst case senario, prices stagnate or fall. So what! Most people buy a house to live in not make profit from. A small fall in prices isnt the end of the world they soon recover and the boom/bust cycle starts again. If you buy a house to make a quick buck, more fool you. Housing is a long term investment but most of all a home.

[rubydazzler 11]

Property always increases in value over the long term. It's obvious there are going to be peaks and troughs, and some areas will go down in popularity but over the long term, prices will only rise.

 

You could waste £thousands renting whilst you're waiting for the market to fall merely by the same thousands you've just put into someone's pocket. 20 years ago houses around Page Hall area were going for peanuts, you could have bought a dozen for practically the price of a detached in Dore, now look at them!

 

I'm still kicking myself for listening to the nay sayers a few years ago when the other half of my semi was on the market ... and it was reachable ... now it's totally beyond my grasp - grrrrrr!

 

It is a long term investment though, not a smash and grab

[doodle 10]

Renting this house is actually cheaper than buying it or one priced similar, I worked out it's around £100 extra a month in mortgage payments, and a further £100 in buildings insurance, boiler insurance and mortgage income protection. We have 25% deposit, but it's still going to be more expensive to buy monthly than rent and have a crappier house to boot (smaller, no garage/drive etc).

 

Why do people keep going on about it being a long term investment. I don't really care if my house price goes up, because unless I sell up and downsize, I don't make that money, it's all tied up in the house. As far as I'm concerned and I'm guessing a lot of people are, its monthly affordability that counts and getting the best house we can get for that money. I don't see why I should have a mortgage of X amount of money, when I might be able to get the same house for less in a few months time and save myself some money. Most of the houses are a dump that are on sale and need gutting. Owners are being greedy expecting far too much for their house. One house we recently viewed was really a 2 bed and not a 3 bed as advertised and needed a new kitchen, new bathroom and the rest of the rooms needed attention, but they are still asking top wack for it and quite frankly, I'm not going to pay it and neither are any other people judging by the fact that they are still on the market 4 months later.

 

We might be wasting money renting, as some people say, but I don't think I am. I have a better house than if we had bought for less money a month and I don't have to worry about repairs to the house. We aren't in a rush to move, and will be sitting and waiting till the right house at the right price comes along. Which I think a lot of FTB's are doing, judging the state of the housing market at the moment.

[Tiggerchick 10]

The detail around house prices rising or falling is based on supply and demand. We're growing in population so there is an increased demand in property. This is why Sheffield estate agents have been able to deal with sealed bidding etc. and houses have gone well above asking price.

 

Earlier in the year we started to weigh up whether to buy now or wait but decided to just go for it. If you are looking at buying a house now the price you get it at will depend on the sellers situation. We agreed a house price 2 months ago with the people we're buying from. The house had been on the market a few months but they were holding out for a decent offer on the house rather than sell well below asking price. I think this is also a common situation as we came across it with a few other houses we were looking at. Another example is - My parents have had their house on the market for around 5 months (in the south east) and have just agreed a house sale at asking price. They'd had other offers before that but were happy to wait until someone offered full price. If they'd accepted the first (well under price) offer they could have sold in a few weeks. As it is they are relocating so are moving into rental property in the new area so were happy to wait for a sensible offer on their current place.

 

The people that are dropping prices are those that have had an offer accepted on a house they want to move to but the move is dependent on them selling their house. If you want to get a house at a lower price then go for these people. A (cheeky) question like '...are you staying in the area' or 'why are you moving' or 'are you buying somewhere bigger' when you're viewing should help extract the answer. More and more people (in my experience) are trying to avoid these chains by temporarily renting so that they don't have to drop their prices or get caught in desperate chains.

 

We're buying now because we don't want to wait and don't believe house prices will drop significantly. Our next move is planned to be a long term one so it doesn't matter if it all goes a bit wrong over the next couple of years as we'll ride it out. I personally feel that house prices in Sheffield will not drop because there is high demand and prices are still relatively cheap compared to many other parts of the country. I do think Sheffield prices will even out and houses will stop going ridiculously above asking price as they have been.

 

Following what's happened in the US mortgage lenders have started checking their lending more carefully. 'Sub-primers' will have more trouble obtaining mortgages and the lenders are less willing to go to 5+ times salary. Mortgage fees have been introduced since we got our last mortgage and these can be significant. To get the best %age mortgage comes with a hefty price so it's important to weigh up the cost and %age over the timne you plan to keep that deal. (Can you tell this is what we've been doing, trying to weigh up the best deal!?)

 

People were saying that house prices would drop and couldn't be sustained when we first bought a few years back and the prices in our area have soared. If you're in a position to buy then I still think it's better than paying dead money in rent. You just need to make sure you can afford it if the interest rates go up a bit.

 

(and no, I'm not an estate agent and don't have any rental property, yet... )

[Cyclone 10]

News today, citibank CEO steps down after announcing a right down of $8 billion in the 4th quarter. Stockmarkets react with shock and drop quickly, analysts say that the credit crunch and rising mortgage costs look set to continue.

 

doodle - rent may be cheaper on a monthly basis, but in 25 years time after paying rent every month you end up with nothing. 25 years of paying a mortgage and you own the home and can stop paying. That's why people call rent dead money. The real comparison should be between the cost of the mortgage (ie fees and interest) compared to the cost of renting, and on those figures I'd be surprised if renting is cheaper over a long period.

[nickyboyzuk 10]

This subjects just never stops running! Not really surprising as we all have an interest in it.

 

My view is that if you can afford to purchase a house and you want to be in it for a long time then thats up to you. At the end of the day none of us can really influence the market on our own. It's all down to the economy, market pressures, whether the credit crunch will affect us any further and whether people can afford to pay their mortgage.

 

The market is very slow at the moment in areas and I am trying to sell a 3 bed mid terrace in Crookes. I have found a property I wish to purchase but can't sell my own property. This isn't as bad as it seems though. I've knocked 5% off my house (£10,000) and the seller of the house I wish to buy has knocked 5% off theirs (£18,000). I've still not got a buyer and so we are stuck. If property falls I will be happy as the differential between what your selling and what your buying will be less.

 

I expect to have to cut another £10,000 of my house and hopefully the other seller will cut theirs again.

 

Fingers crossed.

[frankief 10]

Not everybody thinks like you Nicky, some people buy a house for say 100K and a few years later it's 'worth' 150K, they think that they have 'made' 50K. (They now have to pay at least 150K for a new one, so they haven't made anything!)This promotes a feel good factor among owners that they 'are on the ladder' and have done well. It disguises the fact that there has been raging inflation in the market and the poor sods at the bottom are going to get hammered even more. It's not something our society can be proud of. With mortgages at 6 to 8 times salary for 30+ years these people are not going to afford it if interest rates soar, and we enter a recession. Take a look at what is happening with the banks at the moment. It could happen, has done before.

[Phylis 10]

Not everybody thinks like you Nicky, some people buy a house for say 100K and a few years later it's 'worth' 150K, they think that they have 'made' 50K. (They now have to pay at least 150K for a new one, so they haven't made anything!)This promotes a feel good factor among owners that they 'are on the ladder' and have done well. It disguises the fact that there has been raging inflation in the market and the poor sods at the bottom are going to get hammered even more. It's not something our society can be proud of. With mortgages at 6 to 8 times salary for 30+ years these people are not going to afford it if interest rates soar, and we enter a recession. Take a look at what is happening with the banks at the moment. It could happen, has done before.

 

There a many major differeneces between the last crash and the situation now. Interest rates were much higher (in double fiugures)and unemployment soared. Today unemployment is at a low interest rates are still cheap compared to the long term average and demand for housing is at an all time high. These factors alone mean a drop in house prices is highly unlikely.

[nightrider 13]

There a many major differeneces between the last crash and the situation now. Interest rates were much higher (in double fiugures)and unemployment soared. Today unemployment is at a low interest rates are still cheap compared to the long term average and demand for housing is at an all time high. These factors alone mean a drop in house prices is highly unlikely.

 

lending multiples are much higher now so interest rates do not need to go as high to cause a problem due to the larger loans involved. Demand is also dropping due to the credit crunch. The longer this carries on the more likely house price crashes will drop because noone will be able to get loans to cover the asking price.

[Phylis 10]

lending multiples are much higher now so interest rates do not need to go as high to cause a problem due to the larger loans involved. Demand is also dropping due to the credit crunch. The longer this carries on the more likely house price crashes will drop because noone will be able to get loans to cover the asking price.

 

It wont get to that stage because lenders would then be shooting themselves in the foot and closing due to no business.