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  1. #1
    MingeBlue's Avatar
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    Would You Buy In The Current Housing Market ?

    Due to splitting with the ex I have got the opportunity to buy her out, I managed to get her to agree to pay her an amount that would represent her capital in the property when we bought it 2 years ago which was 14k property was bought for 330k and at the time we got it cheap. It's on the market for 399k but offers have been at 330k and 350k so far.

    14k seems a good deal but I'm not sure how long it would take for the market to recover, and now they mentioned today the possible suspension of stamp duty. If I bought the house my motivation would be investment as I don't really want to live there, but that may ease with time. Do you think it worth it or would you sell at 350k (no chain so quick) and walk out with 60k in your pocket and rent and see what happens with the housing market ? Do you think the housing market would ever recover to the same levels as before ? The property is London, nice area and good transport links, in a good market it would sell very quickly imo.


    Last edited by MingeBlue; 5th August 2008 at 22:56.
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  3. #2
    jojo's Avatar
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    House prices are set to fall well into 2009 according to a mate of mine who works in an Estate Agent in South London. Get what you can now, and start looking in 6 months time is what I would do.



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  4. #3
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  5. #4
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    Would the housing market ever recover? Recover from what? All that's happened is house prices have tailed off, which always happens as they can't continue to climb at the ludicrous rates they were previously. This always results in a fall from the peak, but it makes me laugh when the tabloids and so called experts start using the term "crash", when it's actually just come to a slow halt.
    "The biggest fall since records began!" Yeah, when records began in 1997. Talk about trying to instill panic in the market.
    Property still is and always will be a safe bet, the only people to lose out are ones that bought at the very peak, completely over extended themselves to get there and have now split up or can't afford the payments and need to sell quickly. If you can afford the payments, or even rent a room to help out, then in 18months time you'll reap the rewards.
    If you are desperate to sell then you'll lose out as 330k purchase price, sell at 350k and pay the ex 14k = 6k profit, so she ends up better off than you and walks away.
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  6. #5
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    I stayed in mine when I split up with the ex and gave her half of the equity at the time of valuation as it made financial sense to do that but to be fair that was in the middle of the boom in 03, since then it has trebled what I paid for it originally.
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  7. #6
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    Where did you get the figure of 14K from? If you did sell for 350K thats only 20K profit. By the time you have paid estate agents fees, legals fees etc you'll be left with near 12K so in actually fact you'd be loosing out. Unless of course she paid for the deposit etc.

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  8. #7
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    House prices are all a bit ridiculous anyway, they need to fall about 20% to be realistic.
    How long did people think that this spiral would continue for anyway!?
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  9. #8
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    Stay in the house is my advice! Bricks & mortar have always been a solid investment and always will be in my view. Andymac's right, the current housing market situation being over exagerated by press and in no way means owning a house is a bad investment. People who've over stretched themselves are the ones causing concern so if your financially able to pay the bills on the house solo then go with it, its a lot less hassle for yourself not having to move, and avoiding estate agent & solicitor bills that will just eat a chunk out of your equity. If your a little short consider a lodger. Buyers are playing the game well at the moment by offering much under the asking price because the estate agents are telling them its a buyers market blah blah, and the sellers are being told by the same estate agents that the market is slowing and people dont have much money to pay full asking prices blah blah. Its a load of rubbish, estate agents always have only been interested in making money for themselves, and the recent boom yeats have just made then greedier in my view!!
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  10. #9
    MingeBlue's Avatar
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    Quote Originally Posted by marriedblonde View Post
    Where did you get the figure of 14K from? If you did sell for 350K thats only 20K profit. By the time you have paid estate agents fees, legals fees etc you'll be left with near 12K so in actually fact you'd be loosing out. Unless of course she paid for the deposit etc.

    J.
    Hi the mortgage outstanding is actually 261,000, when we bought the place we had an agreement of trust put together which details the split of equity based on what we put in, at the time she refused to sign it, but in the end she did thank god she did !!!!!!! 14k is what I worked out she would take based on my calcs from the agreement with a selling price of 330k and thats after all legals and commission, though I havent pointed it out to her and she hasnt noticed that we wouldnt pay estate agent commission on a deal between us and she has already agreed to 14k in writing.

    I am thinking buying her is the way to go, I would need to spend another 7k though finishing the housing, all upstairs is done just down stairs to do. Though I must admit I've seen some nice brand new 2 bed apartments that I could just move into going cheap.

    Decisions, decisions.......

    Thanks for everyones input
    Last edited by MingeBlue; 6th August 2008 at 11:34.
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  11. #10
    dansansome's Avatar
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    depends if you want a fresh start or not. financially you would probably be better off (long term) in keeping the house if you can. maybe even digging deep to pay her off, then find the 7k to finish the house, and then sell it. a 7k refurb downstairs may equate to 10-15k on the asking price for a potential buyer.

    i think that getting the property in your name is the best way to go. that way you can let the storm settle and make better decisions in slower time as to what YOU want to do with the house, not just sell because she wants her cash back out of it.

    I 100% regret not buying my ex out of the flat we owned.

    just my 2p. good luck with it

  12. #11
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    If it was me, I would stay. You'd be selling in what is starting to look like a buyers market - as you've seen from those low offers - and regardless of the financial climate, the fact is we all live on a tiny, overcrowded island with a well-documented shortage of property. The prices will recover, but in any case, we all need somewhere to live in the meantime! If you can afford to cover the mortgage still, I'd borrow an extra 20k to pay her off and finish the rest of the house off like you suggested!
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  13. #12
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    Personally i would only purchase an investment property in this climate and not a residential one. I think its just a case of waiting for banks to become less cautious with there lending and be ready to move at this point.

    Most people certainly younger buyers will be choosing an interest only product so given that there borrowing wont be reducing and values wont be going up it seems silly to buy. I recently put my residential property on the rental market which let withinh 24hrs as i was moving into a new build but backed due to various reasons. At the moment i am living in rented accomodation, simply being smart i knew roughly where i wanted to live and also when they were built. Given that most people historically went with a 2year fixed product by doing some research it meant i had a rough idea when they would have to remortage and how desperate they would be to rent cheaply. The long and short is i am in a 2 bed 2 bath top floor apartment in Leeds with secure parking and a large terrace which is worth around 250,000 and only paying 725 in rent fully furnished which i think is a steal.

  14. #13
    NHN
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    Not a chance, house prices will fall a fair bit yet as they are well over priced anyway by a huge percentage, just a shame so many will be left either without a house or negative equity, stupid **** false economy with greedy estate agents & idiotic home loans upto 16-20 x someone's salary I mean these loaners moan cause of the sub prime very dodgy market now has bottom fallen out but they fecking caused it anyway, then they announce record billion profits & tap investors for billions cause of a loss, I mean what the feck?????

    I'll keep my money for now & wait for it to bottom out

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  15. #14
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    Yep I wouldn't touch the housing market at the moment, with a bargepole! With it looking like the prices are going to continue falling for at least the near future I think you'd have to be crazy to buy into a situation that's likely to put you in negative equity almost from day one!
    Add to that the difficulty of getting a mortgage at the moment and it just looks like a bad bad idea IMHO!
    Probably not a bad time to sell though, *if* you can find a buyer, I'd bet house prices aren't going to hit their recent peaks again for at least a decade or two. *shrug*

  16. #15
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    We bought our first house just after the start of the last slump (in 1990). It started off at 78,000 was reduced to 72,000 and we offered 66,000 (which was grudgingly accepted). We were in negative equity for a few years and if we had waited we could have saved an extra 10% but we still doubled our money in 2001 when we sold the property, I suspect come 2011 the price will have about doubled again.
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