Getting on the Property Ladder

[airbolt]

Are there any prospect of house prices falling in the next year or will they just plateau ?

I ask as an increasingly despairing First time Buyer who has seen prices go from not affordable to ridiculously not affordable.

[pigface]

The real answer is that nobody really knows.

The Royal Institution of Chartered Surveyors have estimated that houses are overvalued be approximately 20% but think that rather than having any catastrophic fall the prices will correct through a gradual rise in earnings.

The building societies such as Nationwide and Halifax predict that there will either be a 5% rise or fall (depending on which you look at). It interesting to note that these builing societies don't actually use these predictions themselves (its just for marketing purposes).

Looking a the historical data there has been a pattern of peaks and troughs over the past 50 years or so. At present it would appear as if we are at the top of one of those peaks and house prices do appear to be falling a little. However, the economy is still quite strong and there are initiatives being developed that will mean there is still plenty of demand keeping the prices up (govt. assistance to first time buyers).

I'm in the same boat as you at do not feel too positive about being able to afford anything.

[nuoyg]

To be honest I don't know but I would think about the area you live in maybe or want to buy in as whenever I get newspapers with property sections it always sections out boroughs of London and is specific to each and they're not all the same.

My friend really wanted to get on the property ladder and couldn't afford it at all by himself.  He has just bought a part ownership scheme.  Where he owns 'x' % and council owns other 'x'...not sure how they work but maybe could look into those?

Good luck.

[floss85]

Im in the same boat. Desperatly want to buy my own house, but the prices are too high, unless I want to live in a 'rough' area.

[willow74]

Why dont you apply to your local authority for shared ownership properties.  get on this list and then approach housing associations who have shared ownership properties to buy.  you can then just buy 40% of the property or something and rent the rest.  then increase your share every now and then

your on the ladder that way.

[Didwot]

The property market is a tue market, responding to supply and demand. The property market is driven by first time buyers entering the market. If only people who already owned houses were to buy and sell, then supply would equal demand, and prices would remain constant, subject to regional variations as areas became more or less popular.
If first time buyers are unable to afford to buy then the market will stagnate, and prices either fall, or at least stay stable until wage infaltion makes houses more affordable. Any attmepts to buck this fact (reducing stamp duty or shared ownership schemes) will simply drive the market higher.
What will happen in the near future? Who knows. If the Govenrment fiddles with the rules to make house "more affordable" then the reverse will happen. There is no such thing as a cheap house., Only one that you can afford. In this respect interest rates are low, and are unlikely to rise, so by and large houses are affordable, even if in some areas it does not seem like it. People spend what they can afford on housing, and as wages go up, prices (and rents) go up. Buying a house is a long term investment, and any softening of prices will be made up in the long term (it is land ... they are not making it any more). The only people who caught a cold in the 1989/90 slump were those who bailed out. Those who hung in came out in profit on the other side. At all times the house should be a home first, and an investment second.
This answer is subject to every disclaimer under the sun.

[Didwot]

Soryy: True Market

[WoWo]

Take a look at this site,

www.housepricecrash.co.uk

I'm a fully paid up member of the STR club (Sold to Rent) because I believe there will be a crash in the next few years. Didwot pretty much sums it up in that the housing market is subject to the conditions of any other free market, people often say that property always goes up in the long run, this is true to an extent but it goes in highs ands lows right now we're right on a high.

Also I wouldn't touch any joint ownership scheme with a bardge pole. Housepricecrash will tell you why.

[airbolt]

That's a very interesting site WoWo - Thanks for the Tip

[ianess]

It obviously depends on where you live and whether or not you want to relocate.  Many of the so-called "rough" areas of a few years ago are being regenerated and becoming sought-after "dormitory" towns and villages.

My own area is within commuting distance of the whole Central Belt of Scotland and it is still possible to get a very good 3 bedroomed house for much less than �100K.

How anyone can afford a property of more than 4 times their salary is beyond me.

There are of course shared ownership schemes where you only actually buy a percentage of the property, if you want to go down that road.   Good hunting. 

[jake-the-peg]

Sorry to be late on this thread but I think you should be wary about taking too much advice from sites like houseprice crash.

I checked up on the Domain and it is registerred to a Greg Sutton, It looks like he is an economist with an international bank called BIS or the Bank for international settlements. I also note that the site was first registerred nearly two years ago so he's been predicting a crash for at least that long.

I'm not saying that this is the case but you do get people with options on futures trying to manipulate markets - this may or may not be the case here.

I don't think you'll see any sudden crash or surge in house prices unless something major happens to precipitate it. Just the fact that a bunch of economists think that it's overvalued does not mean that people will suddenly start accepting massively lower prices when they sell.

For that to happen you'd need a sudden drop in people's ability to pay their mortgages which would force them to. Such an event would be a sudden rise in interest rates, a sudden raise in unemployment or a sudden event forcing people to liquidate assets - like the Lloyds disasters ten or fifteens years ago.

But since these sorts of events are likely to affect you as well, holding out may not be a good option, a lot depends on where exactly you are places like the south-east or holiday areas like Cornwall may well be higher due to speculation and would be likely to be more volatile.

You could think about some less obvious approaches depending on where you live such as buying a house needing work or buying at auction or possibly even self- build.

Best of luck anyway