Interest Rates and House Prices in 2009

[expat]

That's exactly one reason why I am saying avoid stocks. Even the safest shares are under threat from HMG as they attempt to fill a burgeoning black-hole in finances. HMG stand to make billions out of the Rock at the expense of shareholders, but they cannot nick my house.

Your house. Your pension. Your savings. And any gold that they know about.

Here is how they happen:

1. Your house: well, possibly not yours, but repossessed houses might well become part of a nationalised housing stock.

2. Your pension: taken in to the state system in the interests of fairness etc. Currently under trial in Argentina.

3. Your savings: Wealth tax. Takeover of dormant accounts. Finally, a straight deduction (the Italian government did that just a few years back: overnight, all accounts had 10% deducted from them).

4. Gold: it's been made illegal to hold it before. Your Krugerrands under the floorboards might be invisible (or they might not), but your Bullionvault account will be down the Swannee.

Nothing is safe, and certainly not a Swiss bank account.

[expat]

No - if the NEXT place you buy is also cheaper you are no worse off.

In fact, if you trade up, the next place you buy may be even more cheaper as 10% off £300K is less than 10% off £500K so you could be BETTER off!

Just not so. Example:

You bought for 200k, put in 40k deposit (= 20%). You sell for 20% less, = 160k. Loan paid off, but all your deposit gone.

You try to buy the same house elsewhere: now it only costs 160k, but you have no deposit any more.

The first lender would lend you 160k if you put in 40k, but the second lender will not lend you 160k if you put in 0.

[MPwannadecentincome]

Just not so. Example:

You bought for 200k, put in 40k deposit (= 20%). You sell for 20% less, = 160k. Loan paid off, but all your deposit gone.

You try to buy the same house elsewhere: now it only costs 160k, but you have no deposit any more.

The first lender would lend you 160k if you put in 40k, but the second lender will not lend you 160k if you put in 0.

Aah but my preconditions stated that you should have large deposit!

[DimPrawn]

Aah but my preconditions stated that you should have large deposit!

What like 100%?

[tim123]

No - if the NEXT place you buy is also cheaper you are no worse off.

In fact, if you trade up, the next place you buy may be even more cheaper as 10% off £300K is less than 10% off £500K so you could be BETTER off!

Buy you'd be even BETTER off if you kept the money in the bank and waited for the fall

tim

[tim123]

Aah but my preconditions stated that you should have large deposit!

40K looks like a large deposit to me.

How many people (outside of this board) have that much cash stashed away?

tim

[BlasterBates]

Check out Coca Cola, 1.69% rise today.

[DimPrawn]

Check out Coca Cola, 1.69% rise today.

CyberTory's house went up 3.56% in the same timeframe.

[BrilloPad]

CyberTory's house went up 3.56% in the same timeframe.

blood pressure

[MPwannadecentincome]

Buy you'd be even BETTER off if you kept the money in the bank and waited for the fall

tim

depending on your personal circumstances maybe e.g. you don't have kids, or you don't have to be near a good school or you don't have to pay rent.....