Buying a house (and renting)

PostRe: Buying a house (and renting) by **LewisD** » Mon Feb 08, 2021 4:13 pm

Grumpy David wrote:Interesting property for sale in Portsmouth.

https://www.zoopla.co.uk/for-sale/details/55436165

I mean... 4.25 million for that is actually pretty good, right?
I've seen worse places for £4mil around here, and from the pictures it looks absolutely incredible. Gorgeous in fact.

It's just whether you want to pay millions for an eroding lump of concrete in the middle of the sea :dread:

Imagine the sensation of being in a hurricane in that thing :dread:

PostRe: Buying a house (and renting) by **Meep** » Mon Feb 08, 2021 5:34 pm

Sale agreed. :toot:

Now I just have to hope they people I'm buying from don't find somewhere too soon as I'm guessing the paperwork will be a nightmare. Not to mention all the other crap with sorting out utilities and insurance.

The DIP I have is based on my current salary and I am due to a 2k pay rise at the end of March so I don't think it should be a problem getting it approved at least.

New mortgage statement came today, we're in a position to pay it off now :toot:

PostRe: Buying a house (and renting) by **Moggy** » Thu Feb 11, 2021 11:47 am

Victor Mildew wrote:New mortgage statement came today, we're in a position to pay it off now

Seriously?

Congrats if you are paying it off. Being mortgage free would be amazing.

I was looking earlier at the sold prices on the street I grew up on. The prices in the area have gone insane, but one of the flats there caught my eye. It's a 2 bed flat on sale for £230,000. Looking at the sale history:

1997: £32k
2004: £101k
2011: £145k
2017: £195k

strawberry floating madness. :lol:

And why the strawberry float didn't I buy it in 1997? I was only earning £7.5k a year in my first job, but it would have been just about affordable :lol:

Here's one from my street:

1995: £97.5k
2006: £330k
2017: £480k

PostRe: Buying a house (and renting) by **Jenuall** » Thu Feb 11, 2021 11:54 am

Looking at the price history of property is a truly depressing game!

I'm by no means disappointed with my current lot in life, I'm doing better than I would have ever dreamed of as a kid - I got myself a degree and a PhD and in working in IT feel like I'm in a pretty key sector for society where skills are wanted. 20/25 years ago if I had that recipe of factors I would probably be in a strawberry floating mansion by now! :lol:

What's depressing is that it's another major part of life where the gammons have had the best of it yet again.

This is fun. :dread:

Jan 2018 Flat, Leasehold £605,000
May 2002 Flat, Leasehold £196,000
Aug 1996 Flat, Leasehold £68,000

That's a 2 bed ex Council maisonette, admittedly with a good single storey extension into the garden but even the ones without that are well over 500k.

If any of the occupants are still social tenants on that road, they would get a RTB discount of 105k but would need a household income of probably 90k to get the mortgage.

PostRe: Buying a house (and renting) by **Jenuall** » Thu Feb 11, 2021 12:28 pm

Just had a quick look at the street I grew up on, this was a the change in one house:

Aug 1999: £72k
Feb 2002: £125k
Jun 2020: £280k

Crazy! :lol:

We're just agreeing a completion date for next month now. We're paying £295k. In 2012 it sold for £182,000. It's very depressing.

A house on the same street with a particularly fruitful sale history:

2019-09 £280,000
2015-05 £249,000
2011-12 £195,000
2005-08 £167,000
2003-05 £153,000
1999-12 £91,000
1999-06 £63,000

Can anyone say "unsustainable"?

PostRe: Buying a house (and renting) by **Lex-Man** » Thu Feb 11, 2021 12:45 pm

My house was sold for 71k in 2000 and I bought it last year for 240k. Looking at the price increase actually hurts.

PostRe: Buying a house (and renting) by **jawa2** » Thu Feb 11, 2021 12:54 pm

House prices have, of course, risen dramatically in many areas of the UK. It's worth viewing historical prices at the value of that cost today if making comparisons, though. Below are Moggy's and Drummy's quoted costs alongside the monetary equivalent today i.e. adjusted for inflation. The values were derived from the Bank of Engiand's online inflation calculator.

Moggy wrote:...I was looking earlier at the sold prices on the street I grew up on. The prices in the area have gone insane, but one of the flats there caught my eye. It's a 2 bed flat on sale for £230,000. Looking at the sale history:

1997: £32k
2004: £101k
2011: £145k
2017: £195k

...

Cost then / Equivalent cost today

1997: £32k / £60k
2004: £101k / £159k
2011: £145k / £181k
2017: £195k / £210k

The big jump was from the price in 1997 to 2004, with subsequent increases perhaps less shocking.

Drumstick wrote:Here's one from my street:

1995: £97.5k
2006: £330k
2017: £480k

Cost then / Equivalent cost today

1995: £97.5k / £192k
2006: £330k / £488k
2017: £480k / £516k

Similar to Moggy's example, the rise from 1995 to 2006 was a huge jump but the more recent sale was relatively subtle. The rises at this time were primarily driven by an increasing population and decreased home-building; a perfect storm which has continued through to today. In many cases we may see decreased pricing within the next few years (as people find employment harder to find and wages stagnate)... and/or we could see rich people buying up more property for the rental market. Rental is on the increase as even though rent charges are high in many places it is still more affordable than taking on a large mortgage.

Fake edit:

Jenuall wrote:Just had a quick look at the street I grew up on, this was a the change in one house:

Aug 1999: £72k
Feb 2002: £125k
Jun 2020: £280k

Crazy!

Cost then / Equivalent cost today

Aug 1999: £72k / £128k
Feb 2002: £125k / £208k
Jun 2020: £280k / £280k

Yep, that millennium jump highlighted again; a circa 80k increase in just three years but "only" another £80k in the subsequent 18 years.

OrangeRKN wrote:We're just agreeing a completion date for next month now. We're paying £295k. In 2012 it sold for £182,000. It's very depressing.

Cost then / Equivalent cost today

2012: £182k / £220k
2020: £295k / £295k

Still a large jump, Orange, but maybe not quite as depressing as you'd imagined!

Tl;dr You gotta account for inflation when looking at old property prices and the biggest price jumps were generally around 2000.

PostRe: Buying a house (and renting) by **Lex-Man** » Thu Feb 11, 2021 12:58 pm

My house has doubled in value over that last 20 years, even taking inflation into account but 120k to 240k doesn't quite have the same sting.

Lex-Man wrote:My house has doubled in value over that last 20 years, even taking inflation into account but 120k to 240k doesn't quite have the same sting.

Moggy wrote:
Victor Mildew wrote:New mortgage statement came today, we're in a position to pay it off now

Seriously?

We were at the point of being able to pay it off this time last year, but it would have left us with absolutely nothing, which as it would then turn out with covid, would be a frightening position to be in if we'd lost our jobs (we didnt).

It's either pay it off now with a few grand penalty, or pay some off and have 5 years left. I'm leaning towards jsut getting rid of it, then see about putting massive amounts in to my company pension each month, as work matches a lot of it so it gives a huge savings gain over a crappy 0.0000000001% the bank gives.

PostRe: Buying a house (and renting) by **jawa2** » Thu Feb 11, 2021 1:07 pm

Lex-Man wrote:My house has doubled in value over that last 20 years, even taking inflation into account but 120k to 240k doesn't quite have the same sting.

Oh, absolutely - £122k (equivalent) in 2000 to £240k in 2020 - and I'd imagine the biggest jump for other properties in your area was in the period from the late 90s into the early 2000s. The twin factors of increasing demand and lower availability have been in dramatic effect then and since!

PostRe: Buying a house (and renting) by **Moggy** » Thu Feb 11, 2021 1:10 pm

Even with inflation adjustments (cheers Jawa!) it's strawberry floating horrifying.

I could have bought a 2 bed flat in a nice area on the most basic of salaries (£7.5k was low in 1997!). Now? You have no strawberry floating chance even on a very good salary.

The whole system needs to collapse and I say that as somebody with a fair bit of property equity.

Victor Mildew wrote:It's either pay it off now with a few grand penalty, or pay some off and have 5 years left. I'm leaning towards jsut getting rid of it, then see about putting massive amounts in to my company pension each month, as work matches a lot of it so it gives a huge savings gain over a crappy 0.0000000001% the bank gives.

Pay it off! Imagine how good it'd feel to owe nothing on your home.

Now to buy up more houses and become king landlord!

Yeah pay it off now. I think the penalty is only what you'd pay in interest over the rest of the term anyway... is that right?

Unless something dramatic happens, I won't be mortgage-free for another 10 years

.

Victor Mildew wrote:
Lex-Man wrote:My house has doubled in value over that last 20 years, even taking inflation into account but 120k to 240k doesn't quite have the same sting.

Moggy wrote:
Victor Mildew wrote:New mortgage statement came today, we're in a position to pay it off now

Seriously?

We were at the point of being able to pay it off this time last year, but it would have left us with absolutely nothing, which as it would then turn out with covid, would be a frightening position to be in if we'd lost our jobs (we didnt).

It's either pay it off now with a few grand penalty, or pay some off and have 5 years left. I'm leaning towards jsut getting rid of it, then see about putting massive amounts in to my company pension each month, as work matches a lot of it so it gives a huge savings gain over a crappy 0.0000000001% the bank gives.

To avoid the penalty can you put almost all of it in there and pay the rest off at like £1 per month for the rest of the mortgage period?

Something like that yes. We're going to work it out later. The main aim of all of it is to save up so much though pensions and stuff thst we can both retire early and strawberry float off somewhere hot for the rest of our lives, so it's a big step in that direction.

Buying a house (and renting)

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