Owning your own home

My advisor is the one who will be negotiating with the bank and he seemed confident enough of the valuation, which seems nuts given it's a 50% increase over two years. But zoopla seems to back it up given the other properties in the area.

All this LTV and prediction of crash talk is scaring the shit out of me.

Bought in 2015, right at peak peak but before we knew there would be a referendum (let alone the disaster outcome)

Bought in 2015

Same

It'd be annoying losing 200k+, for sure.

It makes no difference cos you live there. It's all fantasy money, you have a roof over your head and every payment means you own a few more bricks and tiles. It's not worth worrying about paper profits, it changes nothing till you move.

Yes but fantasy money (LTV) is good to get the monthly payment down/reduce what you owe right?

Yes

The size of that payment you make depends on the price of your house (LTV) and what's going on in the economy (interest rates + inflation for your own affordability).

Yeah also I want a really expensive place, just to gloat/feel nice

I thought you already had a condor

When I remortgaged I just plucked a figure out of the air that seemed vaguely similar to the flats nearby. The bank sent a valuer round (basically measured the place and that was it) and I got a mortgage so it must have been in the ballpark.

Personally I wouldn't mind a crash back to 2010 prices (when I bought admittedly). At that point a flat was worth about £250k and a house £500k round me. Now a flat is worth £450k and a house £900k.

There's a chance, with girlfriend, that we may be able to stretch to another £250k to sell my place and buy a house. There's no chance we can stretch to another £450k.

The price increases may keep pace in percentage terms but they leave you screwed in absolute terms.

I don't care about not getting paper profits; I just don't want negative equity.

As Dammit says - would be annoying losing £200k, especially as I wouldn't have had it in the first place.

I think the ideal outcome (for almost everyone) would be static house prices and wage inflation. No-one gets made bankrupt, but the affordability eases over time, and the next rung up the ladder doesn't keep getting further away. I can dream...

Don't know if this is going to work, but here's wage growth from 2016 to a predicted 2018 for the UK in comparison to other economies, before the real impact of Brexit in 2019:

https://interactive.guim.co.uk/charts/embed/may/2017-05-09T14:08:38/embed.html

We finally exchanged! :D

Now what's the next thing to worry about going wrong? It's all pretty much locked in now, right? Safe to put up a link?

So in a way house prices crashing back to 2009/2010 levels would be a good thing as it would put things more closely in reach of a public whose wages are shrinking, year on year.

If you've exchanged and the seller pulls out, you get compensation £££ (usually 10% of purchase price) on top of receiving back your deposit.

I think you're a-okay to post a link!

Moving in here on the 12th!

Yes, in a way it would. But it would produce some spectacular losses to a lot of people as well - including lots of people who worked really hard to buy because it seemed that prices would get further out of reach if they didn't. Which is why a slower release (by steady erosion of the gap through wage growth) would be preferable, no?

@Dammit, the Guardian graph predicts a 0.5% wages fall before Brexit kicks in, what effect will Brexit have on wages? Where did your crash back to 09/10 line come from?

Woah - so much house for the money. Congratulations.

You can get more on wage growth (positive and negative) here: https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/articles/supplementaryanalysisofaverageweeklyearnings/latest

That house prices are now falling is in the papers, that they'll go back to post-last-crash is my way of managing my own expectations and planning for the worst whilst hoping for the best.

Sadly hoping for the best is a significant slow-down in our economy, whilst the worst is Greece #2, but I'm not planning out scenarios in which my flat drops to 25% of it's current value because they are too depressing.

That house prices are now falling is in the papers

They kind of are, kind of aren't. Some places - really expensive places - are looking at modest falls. But London as a whole is still seeing price rises.

Well that would be exactly the situation I'd be in with my wife.

When we bought in December 2015 no one would have recommended not buying when we were in a position to.

The regret now is that if we want a family then we'd want to move somewhere bigger. If we had bought something bigger a bit further out we would have more time to play with riding out the financial waves that seem to be heading our way.

Interesting stuff, cheers, my property dilemma is characterised by my age (40), my ownership history (none), and the fact that my LAYDEE and I will probably want kidz in the next couple of years. Which makes me think I have 2 options:

a) Buy shoebox flat in London. Move in a couple of years
b) Forget option A. Bail to the sticks to get a decent size house now

Decent salary between us, but we are both massive fans of London. Grr

Bloomberg are doing some good in depth breakdowns on house prices in London. Search their site.