First Time Buyer - Purchase timing advice

[Glencky]

I've come back to this thread a few times since it was posted and each tine deleted a response as I'd started to type it.

This is one of the most bizarre and frankly, inappropriate and over the line, threads I think I've ever read (in its own way). Has it occurred to you that 33 isn't so young that you need to protect him from the world? Has it occurred to you that if he's managed to build up anything like a £300k warchest he must be doing something right and luck is not the only factor? Has it occurred to you that you've already given him the benefit of your advice (a perfectly reasonable thing to do, given he's a friend and you're concerned for his welfare) and now you're just trying to recruit people to steamroller him?

Others have made good points. He may not want a flat, he may want an actual house and home. Perhaps he doesn't actually like cities. Maybe this isn't an 'investment'. You say he's 'unintentionally' isolating himself - perhaps it's intentional!

I think you need to open your mind and consider that he actually might just have different priorities and values to you, and that this is his prerogative. Honestly, if this were my friend I would also have given them my thoughts if I was concerned about the implications of their plan, but having done that - back the heck off. His life is his responsibility, and so far he seems to be doing OK at it given the size of his warchest!

[simes]

Completely agree with that last.

A house is a long term investment. And who knows whether the current condition is likely to get better, worse, or stay the same.

If said purchaser can afford it, and admits to all he doesn't know what will happen in 25 years, then go for it.

(Pretty much the same can be said about buying the right pension. Who know what interest rates and tax laws will be like in 45 years' time. The thing is, just to start)

[Lance]

Would you advise your hypothetical offspring to buy a house right now given the market conditions in most of outer-London?

If said offspring needed somewhere to live, that they can afford, and they want; it would be interfering to do anything other than be supportive and encouraging.

[WTFH]

I don't know about you lot but my friends seem to be staying in the same houses with no plans to move, seeming to be scared to move in case the market blows up....

Some people buy and sell houses and are hypersensitive to house price fluctuations. Perhaps he is looking to buy a home - not a short term investment.
In which case, stalling in case the market falls is stalling while prices are rising, and stalling while interest rates are low.
You’re saying your friends are scared to move - maybe, just maybe, they are happy where they are at the minute, and are enjoying their home. That’s not being scared or being risk averse or not making plans, that’s about buying somewhere they like as a place to live and not as a temporary house to last until they must buy something more expensive to keep up with heir friends.

I have bought and sold homes in Scotland some years ago, in Edinburgh and Glasgow, but the prices seem to have skyrocketed for a dull two bedroom tenement to levels I can only recall in 2007. Young folks can have short memories of 2007 if they were too busy jetsetting rather than house hunting back then.

You might remember 2007, but do you remember interest rates in the 1980s?

If all you are doing is trying to force him to invest in somewhere that he doesn’t like, based on your opinion of what a house can only be for, then maybe ask him is he doing it as an investment, or is he looking to buy a home to live in for a few years.
The fact that he was talking about wanting a place with land would make it seem that he has a longer term goal than financial investment. Maybe he’s not interested in living in high rise blocks of flats in a concrete jungle and actually wants a bit of peace and quiet, a view of grass and trees and a place he can call home.

[rogerfederer]

Sounds like you’re interfering.... bluntly....

He doesn’t want to ask the question in a forum. Probably doesn’t care what we think. Have you considered minding your own business? Your financial screw ups aren’t his problem.

He doesn't use the forum at all and appears to be one of those intuitive people who rely on their own research. Still, no harm asking.

My caution and luck have meant I have not had any financial screw ups. Luck is probably the major player.

Would you advise your hypothetical offspring to buy a house right now given the market conditions in most of outer-London?

[rogerfederer]

Thanks all.

The guy's family were sadly lost in a car crash two years ago, so I can see he is a bit lost at times with where to live and what to do with himself.

The main concerns from me, as a friend, were that he would be isolating himself unintentionally and also moving at one of the most expensive times in the market in Scotland. I looked at rightmove.co.uk for Glasgow and then along the west coast and could not believe the prices that surveys are being completed at. Their 'offers over' system seems to encourage a price 10 to 20% below what the seller expects to receive, judging by the sold prices in different popular areas.

I don't know about you lot but my friends seem to be staying in the same houses with no plans to move, seeming to be scared to move in case the market blows up. A couple of friends who run major housing agencies have said they expect a reasonable correction within the next year. For a young person's first purchase I would often pass information such as this on.

I have bought and sold homes in Scotland some years ago, in Edinburgh and Glasgow, but the prices seem to have skyrocketed for a dull two bedroom tenement to levels I can only recall in 2007. Young folks can have short memories of 2007 if they were too busy jetsetting rather than house hunting back then.

[Lance]

Sounds like you’re interfering.... bluntly....

He doesn’t want to ask the question in a forum. Probably doesn’t care what we think. Have you considered minding your own business? Your financial screw ups aren’t his problem.

[WordIsBond]

pull your resources

I've never heard it called that before, but OP probably can handle it by himself without moving in with someone.

Are there no mods around to move this thread to General?

[GhostofTarbera]

Are you moving in with him to pull your resources ? Does his passion for cottaging not excite you? At the end of the day let him do what he wants, a skinky flat is not what he wants

[PhiltheGreek]

The best time would be to buy 20 years ago. The second best time would be now.

[WordIsBond]

If he's not telling the truth about his warchest, advice is meaningless. Why would you think he isn't? If he's been contracting for a while as a single guy and isn't a big spender (people who want to live in a village often aren't, that's not the profile of a hookers and blow kind of guy), he should have a big warchest.

If your profile is right, guess what? He can afford to lose £50-100K on his house if the market crashes. If it is where he wants to live, and he thinks he'll stay a while, the price is likely to recover over time, even if it crashes. No one has figured out how to create new land in the UK, demand is eventually going to outstrip supply and drive prices back up again. The exception would be if demand permanently crashes because hundreds of thousands die when we get nuked by Putin or Trump or a terrorist. In that case we've got bigger problems than house prices, and he's got a better chance in a village than a city.

Or in other words, go back to trying to win tennis tournaments, your time is almost up, and let the guy buy what he wants. The only worthwhile advice you can give him is: 'Have you considered the midges in the west of Scotland? Are you out of your mind?'

[ladymuck]

No-one can predict a property crash or boom. It's crystal ball stuff.

I don't know why you're so set against him living in a village. City centre living isn't for everyone.

I'm not sure if you're telling him to buy an investment property or a home. The criteria for each is vastly different.

Not clear what your ask is. Personally, I would tell him to pick a HOME that he would be happy with for a good while, in whatever location he wants to settle. Negative equity only becomes an issue if you need (rather than want) to sell, can't afford your repayments, or need to borrow against the property.

[ContractorScum]

Whats the question here?

Can we move this to general?

[rogerfederer]

Hello forum.

On behalf of a younger friend (yes, really!) up north I wanted to ask on his behalf as he is about to buy property. He doesn't post here but I've told him to consider it before. Posting in Accounting, rather than General, for obvious reasons.

Deposit could be up to £110k on a remote cottage that I personally think - and have told him as much - could be difficult to sell during any downturn. In Scotland and Northern England I would say they are at peak prices that cannot go much higher when our economy has crapped out.


Stats:
His age - 33
Contractor for approx 8 years (as a guess)
Single
Location - west Scotland
Warchest - he says £300k in the business bank account, but I don't know the truth of this or the finer details of this
First time buyer
Property - cottages, houses with small pieces of land attached. £300k to £400k pricing

Life is different for me, as I have a wife and children. I am risk averse!
I have advised him to hold off buying in a rural community mostly due to the brexit effect, currency devaluation and what surely is a forthcoming negative effect on house prices our badly performing economy. Even when accounting for increased inflation percentage I suspect house prices will dip substantially (10 to 25%) over the next few years.
His argument is: if he says this forever he will never own a house or settle somewhere

He seems too young to me to be moving to a small village. Have any others considered this recently and can offer advice?

I am trying to persuade him to buy a smaller flat somewhere central to tide him over but I can understand his impatience at feeling sick of waiting. I was the same in 2005, but regret my rushing into a purchase so shortly before the financial crash. Hindsight is wonderful!