Owning your own home

We are crabs in a barrel aren't we. sigh

Just as you’d feel stupid if post brexit the £900k house only falls to £850k but interest rates shoot up and that £850k debt becomes unaffordable. You’ll wish you’d locked in on a long term fixed rate at the higher purchase price because it was £2k a month cheaper to service the debt (based on a fictional 4% rise in rates).

Does anyone want a two bed flat in bow? No onward chain...

Just as you’d feel stupid if post brexit the £900k house only falls to £850k but interest rates shoot up and that £850k debt becomes unaffordable.

I think at that point you'd realise you really are a crab in a barrel and maybe mansion owning isn't for you.

Also, I suspect a 4% increase in rates and only tiny dent in house prices isn't that realistic a scenario. Could be wrong tho.

I think a lot will rest on the results of the leadership contest that would appear to be leaving the line at the moment.

You can only deal with the reality in front of you, we can’t be sure about the future. For all we know the prices might have already corrected for brexit and the buyers holding off now will rush back into the market in April creating a demand and price spike.

We're pretty certain we're staying put until after Brexit now; we offered £725k on that place, from a few pages back, that was on at £800k.

They countered at £750k but I'd want to put that difference all back into the house to get it up to what we want.

Let's see if it's still unsold by March next year...

^^Well, anything's possible - but that's incredibly unlikely.

The reality in front of us is encroaching disaster.

buyers holding off now will rush back into the market in April creating a demand and price spike.

Yields are shit though, so the entire BTL market is dead in the water. So that leaves residents and investors looking for capital gains or safe havens. Assuming we get any kind of hard brexit the later will look elsewhere. So that leaves residential buyers to prop the whole thing up.

But yeah could be a massive surprise.

Just as you’d feel stupid if post brexit the £900k house only falls to £850k but interest rates shoot up and that £850k debt becomes unaffordable.

That could only happen if after Brexit everyone suddenly has lots more money so that they can suddenly afford the mortgage on a £850k place, keeping house prices bouyant despite the increase in interest rates. I'd put that firmly in the 'Unicorn' and 'Magic Money Tree' part of the Venn diagram of probabilities.

I’m still hoping for a crash in Sterling, this would stimulate the housing market with an influx of foreign investors and revive the British tourist industry as Spain suddenly becomes unaffordable to the average Brit.

Im sure there are a few on LFGSS who were around and propertied in the mid 90's.

Upon a depression (even a dip) there will be less stock available (people will stay put). Interest rates would (probably) be higher. Lender restrictions WILL be tighter. My point. If you can buy now on a long fix and its affordable id say go for it. If its a do it up and flip it, then your braver than me.

Personally. We are buying half a mile from where we currently live, double fronted vs single, lots more room but doing so with no extra borrowing. Its our last chance to move to the home we always wanted and stay in the area (se7) at a level of affordability (not just price) that I don't think we will see for a little while.

Probably wrong. I usually am.

Previous financial crash was global- this will be local, I’d expect to see an outflow of skilled workers and their families, potentially bringing more housing stock into the market.

And more jobs for UK people.

Wait.

Fair point. I dont think the outflow will be that great but maybe in principle. Remains to be seen.

tell me more...

^^Depends how many of the 3.8M EU citizens decide to pay their £65/ea and stay, plus how many non-EU wish to stay in a contracting economy, and finally how many U.K. citizens still have jobs here/are not going to follow their company to an EU country.

I don’t imagine that all 14,000 airbus employees will leave, of course, but will those who stay be able to afford their current mortgage?

So, as long as we are staying in london all will be fine. If it really goes tits up and we move (to the content for example) then we will have wiped out a load of savings. think it is a small risk tho.

Pretty much yes. A home is something to live in and enjoy it shouldn’t really matter how much it is worth day to day or what the market does in the short term. You’re not speculating for a quick buck you’re longer term than that so it’s time in the market that counts not timing the market.

I've hedged the risk with Gammon futures

home is something to live in and enjoy it shouldn’t really matter how much it is worth day to day

This.i think.

Unless you can’t remortgage as the house has halved in value. Although as long as you can cover the payments who cares I guess

Are they like confederate bonds which were only bought and sold by other confederates?