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As a FTB, would you buy a house now?

Discussion in 'Speaker's Corner' started by Bes, 6 May 2006.

  1. Bes

    Soldato

    Joined: 18 Oct 2002

    Posts: 7,303

    Location: The Ghetto: AKA Brixton

    Hi

    I am interested to see what people think about the current property situation in this country.... Would you buy a house at the moment as a first time buyer or would you wait for the market to cool off(if it ever does)?

    Thanks
     
  2. ElRazur

    Capodecina

    Joined: 15 Mar 2005

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    Location: I am everywhere...

    From msn money

    At the present moment, if i have the money i would. Nothing is as good as having one's home.
     
  3. dirtydog

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    I'm not sure I follow his logic there - renting can have plenty of headaches which you don't get if you own your own place.
     
  4. ElRazur

    Capodecina

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  5. dirtydog

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  6. Stolly

    Mobster

    Joined: 11 Mar 2004

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    Do it, get your foot on the ladder. Apart from a very few areas in the country, the worst that can happen is that the value of your new home will remain flat. More likely what is happening is that the cost of your first home is rising at a rate that outstrips your wage increase, making it more painful to get on the ladder every month you delay.

    Do it, or decide now that you will rent for the next 5 years at least, but get off the fence regardless.
     
  7. Dolph

    Man of Honour

    Joined: 17 Oct 2002

    Posts: 49,287

    Location: Plymouth

    You'll get mixed advice in this thread, including (I guarantee) a few doom mongers who have been peddling the same "disaster just around the corner" line for several years...

    Really it depends on your position. We bought last year (FTB), and it was a very good move in my opinion. Our mortgage doesn't cost us any more than our rent used to, our expenses haven't really changed overall (some have gone up, others have gone down) and we actually have something to show for our money.

    The market is pretty static at the moment, It's not rising rapidly (although it is still rising, especially over the last few months), and much of the dramatic price activity is further up the market where most FTB's simply cannot go anyway.

    It's a bad time to buy if you expect to make money, or if you expect to be moving again in the not to distant future, as there is still the possibility of a price drop (although not likely a major one unless something dramatic happens in the economy, the current circumstances are very, very different from the early 90's), but you take that chance at any time.

    Without knowing your exact circumstances, it's hard to say what would be the right move for you, but I know buying was the right move for us.
     
  8. starscream

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    Personally, I took the plunge 3 years ago, and am still happy that I did.

    People have been talking about a crash in prices for ages now, and it's never happened. I suppose if you buy with a view to moving with 2 years, there is a danger that you might get into negative equity if you don't have a big deposit. Looking at it with a longterm though, even with the dips and peaks, house prices have doubled in every 7-10 year period since the war.
     
  9. jim5000

    Hitman

    Joined: 24 Mar 2006

    Posts: 951

    Location: UK

    We're looking to move soon, and would love to buy somewhere, but i dont think we will get a morgage, certainly not one big enough to buy a house in Canterbury!!!

    It just makes me so mad though, having to basically give away £550+ a month for a roof over our head, when if we could just get a morgage we could be paying less a month and keeping our hard earned money for ourself. Its even worse when you consider the people you are renting from are the very reason you cant buy a house, as they have brought all the cheap homes to rent to people like us. We should own our own house, not line the pockets of some already rich people who want a few extra holidays a year!!
     
  10. Sequoia

    Wise Guy

    Joined: 15 Aug 2005

    Posts: 2,948

    It would depend on my personal circumstances.

    I don't expect the house market to crash, but I don't expect returns to go back to the levels they were in recent years either. And, though a crash isn't (IMHO) likely, it is certainly possible. External events could trigger it, since house prices are determined by supply and demand and that is a function of numerous factors, not least of which is consumer confidence.

    If you plan in being in the house for a few years, and if your personal circumstances are secure (job, etc), and if you aren't likely to move to house an expanding family, etc, then I'd buy. If you might have to move regions for your job, or if your company is insecure, etc, then rent.
     
  11. VIRII

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    I am not sure what kind of mortgage you'd get for £550 a month, presumeably not enough to buy a house?
     
  12. Dolph

    Man of Honour

    Joined: 17 Oct 2002

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    Location: Plymouth

    £550 a month gets you about £100k if you've got a decent interest rate, although you have the various insurances on top of that.

    Depending where you live, and what you expect, that may or may not be enough.

    It's not enough to get somewhere reasonable as an FTB in plymouth now, unlike a year ago.
     
  13. cleanbluesky

    Capodecina

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    As a slight aside, what sort of lending periods do you guys find acceptable?

    25 years on avg.?
     
  14. VIRII

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    I haven't looked at that sort of price range in a long time but I don't think you can get anything in Hertfordshire for 100K. Prices here have doubled in under 6 years, sheer madness really.

    Perhaps the age of house ownership is over and the age of the landlord is back, FTB's are in a terrible position through no fault of their own.
     
  15. VIRII

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    It would depend on your age and probable career path.
    If I was young and expecting a decent dual income I would borrow as much as possible and spread it over as long as possible as 5 or 6 years can make a huge difference to your income.

    In other words at 25 I might not be able to afford 250k over 25 years but might be able to afford it over 40. Then as my career progresses and my earnings increase as do those of my wife we can drop the mortgage period down to 20 years or so.
     
  16. jim5000

    Hitman

    Joined: 24 Mar 2006

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    Location: UK

    I realise that a morgage would cost more than £550 a month, my point is that i would rather be paying however much it is into my own house than basically paying off someone else's morgage...
     
  17. VIRII

    PermaBanned

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    The thing is when you own there are numerous disadvantages.
    You can't move around the country as easily, you get taxed through the nose if you sell and or buy another house, when you die the Govt have plans to pretty much ensure that none of that house is left to your children.

    What are the actual advantages of owning in reality over renting? Especially at current house prices.
     
  18. Indy500

    Capodecina

    Joined: 7 Mar 2005

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    I'm unlikely to be able to afford a house for some time, not in this area anyway.

    Then again, I know someone with a 20k income who got himself a 260k house, so maybe its not as far off as I think...
     
  19. starscream

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    I went over 25 years (I'm 27) for my flat and when I sell up and move in with my gf, we will probably reset it to 25 years again. As our income grows as we get older, hopefully we will be able to put some spare cash into paying off the mortgage and reducing the term. By moving in together, we will be saving about 600 quid a month in mortgage/rent between us, plus the bills will be halved, so it should be possible after everything has settled down.
     
  20. Visage

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    Personally i've got two mortgages - a 15year one and a 30 year one. The 15year one is for a letted property, with the 30 year one for my main residence. I've no great issue with long terms (Im only 29, so its not a problem), and with the renatl property i went for the shortest term that I could cover with the rental income. I remortgage one or the other every year, so I can keep track of rental increases/decreases.