House prices.

[Buckman]

Do you think that with inflation increasing it will push down the price of houses? Our daughter although still in SA has been looking at buying a home rather than renting when they arrive here as they will have a substantial deposit and could even pay a mortgage for the year upfront if they can find a lender as initially they will both be unemployed.

 

[RogerL]

More likely to just reduce the rate of increase, rather than actually reduce prices.

 

[otherclive]

As long as there are more buyers than sellers prices are unlikely to tumble, and interest rates are still low, so I’d agree with Roger. Unemployment increasing could make a difference if owners default, but with 1.3 million job vacancies that’s not going to happen overnight. I think your daughters best bet is to dive straight in and get on the ladder as rents are significantly above mortgages. But one or both will need to be working in order to obtain a mortgage, and I don’t know how their credit rating would check out so their first mortgage could be more expensive.

 

[Buckman]

As long as there are more buyers than sellers prices are unlikely to tumble, and interest rates are still low, so I’d agree with Roger. Unemployment increasing could make a difference if owners default, but with 1.3 million job vacancies that’s not going to happen overnight. I think your daughters best bet is to dive straight in and get on the ladder as rents are significantly above mortgages. But one or both will need to be working in order to obtain a mortgage, and I don’t know how their credit rating would check out so their first mortgage could be more expensive.

No UK credit rating, but Experian and another credit agency Transunion have branches in South Africa. Rental to stay in the area where they want to live is above average and certainly a lot higher than if they were paying a mortgage.
Problem is that they are bringing two small dogs with them and finding rental in the school catchment area that allows dogs is like finding hen;'s teeth in a desert!

 

[Raywood]

This needs a crystal ball but those that know suggest there will be a readjustment. This seems to mean either a small drop or a levelling off but no one knows for sure. What seems inevitable is that many people who are mortgaged up to the hilt will struggle to maintain the current one or find one they can afford when their current deal ends. A lot depends on the numbers involved but a small drop is perfectly possible as those who do the forecasts generally have an interest in keeping prices high and therefore want to avoid too much gloom.
I think inflation limiting peoples ability to pay their mortgage is possibly the main factor rather than employment problems.

 

[Buckman]

This needs a crystal ball but those that know suggest there will be a readjustment. This seems to mean either a small drop or a levelling off but no one knows for sure. What seems inevitable is that many people who are mortgaged up to the hilt will struggle to maintain the current one or find one they can afford when their current deal ends. A lot depends on the numbers involved but a small drop is perfectly possible as those who do the forecasts generally have an interest in keeping prices high and therefore want to avoid too much gloom.
I think inflation limiting peoples ability to pay their mortgage is possibly the main factor rather than employment problems.

Looked at a house on Rightmove that they were interested buying. It was sold in 2012 for £125000. Today the seller is asking £250000 so 100% increase in 10 years. Unfortunately on checking it was outside the school's catchment area.

 

[otherclive]

We bought a house in 1999 for £68k, now valued at around £260k. But can’t do anything with it otherwise it would render daughter and family homeless.

 

[RogerL]

Looked at a house on Rightmove that they were interested buying. It was sold in 2012 for £125000. Today the seller is asking £250000 so 100% increase in 10 years. Unfortunately on checking it was outside the school's catchment area.

Do schools still have catchment areas?

My understanding is that parents can include the local school on their list of choices but can't guarantee a place there - it's a ridiculous policy as it forces more parents into the "school run".

 

[Buckman]

Do schools still have catchment areas?

My understanding is that parents can include the local school on their list of choices but can't guarantee a place there - it's a ridiculous policy as it forces more parents into the "school run".

We are in a rural area so school does have a catchment area. They need a school that has sports activities as the youngest excels in sports especially triathlons and is a keen rugby player. Our grandson has also participated in world championships in triathlons in Georgia and come third so wants to continue doing sports.

 

[otherclive]

We are in a rural area so school does have a catchment area. They need a school that has sports activities as the youngest excels in sports especially triathlons and is a keen rugby player. Our grandson has also participated in world championships in triathlons in Georgia and come third so wants to continue doing sports.

We have two large secondary schools near to us and our grandchildren went to one or the other. Whilst the schools were good academically and had some sport, athletics and gym sessions it wasn’t that broad a programme. So the grandson joined the local rugby club, and granddaughter initially did gymnastics then moved on to Taekwondo both via external clubs.

 

[otherclive]

Here is the latest RICS May 2022 assessment of the housing market. Might be of interest to you.

https://www.rics.org/globalassets/rics-website/media/knowledge/research/market-surveys/uk-residential-market-surveys/5._web_-may_2022_rics_uk_residential_market_survey_tp.pdf

 

[Dustydog]

HMG are supposed to be introducing a new Law to give renters better terms from Landlords including keeping pets. I cannot understand why it is ok to pay rents often twice the cost of the mortgage ?
Bank of mum and dad maybe?

 

[RogerL]

HMG are supposed to be introducing a new Law to give renters better terms from Landlords including keeping pets. I cannot understand why it is ok to pay rents often twice the cost of the mortgage ?
Bank of mum and dad maybe?

The law of Supply & Demand controls rental costs as well as house prices.

Politicians will say we need more houses, I say we need fewer people!

 

[otherclive]

HMG are supposed to be introducing a new Law to give renters better terms from Landlords including keeping pets. I cannot understand why it is ok to pay rents often twice the cost of the mortgage ?
Bank of mum and dad maybe?

The reason we bought a second house was because our daughter and husband were continually having to move every six months as landlords were reluctant to renew leases even though they were exemplary tenants. It meant that our young grandson wouldn’t be able to stay at one school. So we bought them a house but we retained ownership until they could save a deposit to purchase. But two divorces later etc and the rest is history. But it’s done what was intended it has given the family a stable home and the grandchildren have had continuity of education and friends.

 

[woodsieboy]

Our son has 3 houses that he rents out, most recent tenants are from South Africa, they were unable to meet the credit checks, due to failing the credit reference agency checks. They paid 6 months rent up front and so far have been good tenants, apart from sneaking in a dog after the agreement was done, but then that is covered by them taking extra insurance to cover any damage done by the dog. In the case of getting a mortgage in my experience there is always somebody out there who will advance the money however there will be a premium to pay. Suggest that Buckman's family start looking for a mortgage specialist out side the mainstream providers now. Find somebody you are comfortable with and whatever you do tell the truth and give them the whole picture, they make their money from lending , so they will want to do a deal, it may be that the interest rate will be higher, but the secret is to get that first mortgage, and get on the ladder, then maybe 3 years down the line, when they have a UK credit history, renegotiate the deal. Just make sure you are not locked in to expensive penalty clauses for settling early. On the issue of Credit Agencies our son has the houses all mortgage free, has always paid cash for his cars, holidays etc, is in a well paid job, his only credit has been his mobile phone, so when he went to buy furniture the sales person offered him interest free credit which he didn't want, but suspect there was an earner in it for the sales person, he failed the credit check, because he hadn't got a credit history.

 

[Buckman]

Here is the latest RICS May 2022 assessment of the housing market. Might be of interest to you.

https://www.rics.org/globalassets/rics-website/media/knowledge/research/market-surveys/uk-residential-market-surveys/5._web_-may_2022_rics_uk_residential_market_survey_tp.pdf

Thanks for the link and sent it to the daughter. I think they are in for a big shock when they eventually arrive as most homes will be like moving into a shoebox.

We looked at a townhouse yesterday for them and barely enough room to swing a cat. The lounge area was smaller than the kitchen in their previous home. The place is about 2 years old and we saw them building the estate. The shoebox was selling for £250k. Ideally they want a bungalow.

I have suggested looking for an older home that may need some renovation as rooms will be bigger and the price lower, but they are not DIY people.

 

[otherclive]

Our son has 3 houses that he rents out, most recent tenants are from South Africa, they were unable to meet the credit checks, due to failing the credit reference agency checks. They paid 6 months rent up front and so far have been good tenants, apart from sneaking in a dog after the agreement was done, but then that is covered by them taking extra insurance to cover any damage done by the dog. In the case of getting a mortgage in my experience there is always somebody out there who will advance the money however there will be a premium to pay. Suggest that Buckman's family start looking for a mortgage specialist out side the mainstream providers now. Find somebody you are comfortable with and whatever you do tell the truth and give them the whole picture, they make their money from lending , so they will want to do a deal, it may be that the interest rate will be higher, but the secret is to get that first mortgage, and get on the ladder, then maybe 3 years down the line, when they have a UK credit history, renegotiate the deal. Just make sure you are not locked in to expensive penalty clauses for settling early. On the issue of Credit Agencies our son has the houses all mortgage free, has always paid cash for his cars, holidays etc, is in a well paid job, his only credit has been his mobile phone, so when he went to buy furniture the sales person offered him interest free credit which he didn't want, but suspect there was an earner in it for the sales person, he failed the credit check, because he hadn't got a credit history.

My wife got the same refusal for finance on interest free credit as she had no credit history. When applying for a joint bank loan we were quoted double the rate of interest applicable compared to if I alone had applied. So we decided the loan would be in my name as the saving was significant. Since then she has obtained her own cards and SIM contract and a bank account of her own. Makes things a bit simpler should I disappear off of the plot without giving notice.

 

[Buckman]

As they will be first time buyers in the UK I looked it up to see if discounts are offered. Reading through the bumpf it is not worth the hassle to apply.

 

[Raywood]

Long before you need to apply for a loan of any kind it is essential to set up a good credit record. With our daughters this meant getting a credit card as early as they could and using this sparingly and paying off the borrowing each month. If they are good with this it establishes their credit record, although there are other factor taken into account by the loan providers, but this is the one you can perfect yourself.

 

[Buckman]

Long before you need to apply for a loan of any kind it is essential to set up a good credit record. With our daughters this meant getting a credit card as early as they could and using this sparingly and paying off the borrowing each month. If they are good with this it establishes their credit record, although there are other factor taken into account by the loan providers, but this is the one you can perfect yourself.

Experian and Transunion both have branches in South Africa so hopefully their credit records over there can be accessed.
Credit recoird even for renting seems to be the biggest stumbling block at the moment as loan companies tend to follow a script and not look outside the box. On rental in addition to the normal deposits etc they have offered to pay a year's rent in advance and still get turned down.

 

[Lutz]

I had my house valued in 2018 and about this time last year a couple of estate agents came and had a look with a view to putting it on offer. Compared to the 2018 valuation I was able to sell it privately at a price 90% higher and between 20% and 10% higher than what the estate agents thought it was worth last year. Needless to say I was very happy with the outcome. As I am downsizing to an apartment a similar cost increase for a new purchase doesn't affect me quite as much

 

[Beachball]

We brought a bungalow in 2016 and paid £105k we got it at a good price it needed work but everything has been replaced new windows .Gutters & sills etc but we had it valued and it has double in price .so we decided to put our son and two granddaughters on our will just in case

 

[Dustydog]

Clive you’ve done a DD. Posted sideways pics🤪🤪

 

[Buckman]

Clive you’ve done a DD. Posted sideways pics🤪🤪

What pic?????????

 

[Dustydog]

What pic?????????

Clive’s removed it and asked Sam for help. Sam had to help me with photos 90 degs out of true