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Good time to buy a house

by pmatos 31 March 2011 |

3 comments | Love

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I am looking to buy my first house but I am not in a rush, so the deal is: is it a good time to buy a house?

Cheers,

--
PMatos

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Daytona posted
No it isn't. According to data from the Land Registry and National Statistics, the current house price is 5.0 times the average salary, compared with the average since 1930 of 3.4. Therefore a 30.6% fall is required merely to return to the long term trend, ignoring the markets tendency to overshoot in either direction. As ever, anyone using borrowed money to purchase above the long term trend is taking on significant risk. Historically, the property market has taken some time to resume steady growth after a period of deflation, in 1992 it took 3 years, 1980 2.5 years, 1977, 1970, 1955 & 1948 1 year, 1934 4 years, enabling potential purchasers time to wait for prices to stabalise for a period before committing to purchase.
Posted on 10 April 2011 | Love 0 loves Report
76

Ed Bowsher posted
I'm less bearish than Daytona. I think if you use the house price/earnings figures, you're not really comparing apples with apples. that's because in 1930, most married women didn't work and now they do. So most homes are being bought by couples with two salaries coming in.

That said, our sluggish economy means that house prices may fall a bit more.

But overall, I'd say go for it and buy now. Sure, you might not be buying at the bottom, but at least you won't be wasting money on rent anymore. And if you hang around waiting for the bottom, you might waste a lot of time and discover that you had missed it.

Regards,

Ed
Posted on 20 April 2011 | Love 0 loves Report
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stoprisk posted
The main thing is do you really want to stay in the area forever, because if you do then buying the house is a good bet, but you will loose the freedom to move. So many people forget that and end up losing money when they move. It all depends if you love the area, because there will be massive price falls and rents going down as this government cuts back on benefits payable for rent assistance and cuts jobs too. So first of all, can you really afford it and secondly do you really LOVE the area. Good luck anyway, cheers !
Posted on 07 February 2012 | Love 0 loves Report