firstbuy / homebuy first time buyer scheme

[Mister Clark]

If you think house prices have crashed why not buy then?

My take on all this is..Your house is your home. Whatever goes on around you you have a home and you need to keep hold of it. If you are lucky enough to buy in a dip then great, if you didn't that's life but at least you have a home. It is not an investment, it isn't something you are going to make anything on until you retire and it is so long term. You can take advantage of peaks and troughs though. Upgrade when there is a crash so you get a bigger house that has lost more, downsize in the boom times so you the increase on your house is more. Whatever you do you still have a home.

I couldn’t agree more.

Comparing the rise of gold prices against that of property prices is entirely false.

Go and buy 10k worth of gold today and tell me what its worth in 10 years time, I bet you don't double your money as we are nearing the top of that particular boom (and see what happens to your gold investment if America decide to flood the market in an attempt to stave of another recession).

Conversely by your own admission property prices have crashed; judge when that dip is at its lowest (good luck), buy property and watch your investment double in value or more over the next 10 years while someone is paying your mortgage for you and netting you 5% profit on your investment evrey year.

Last option could be to freeze a load of bread and wait 50 years; you will make a mint.


PS - Suggest you read and understand how the housing scheme you are thinking of exploiting actually operates before you post on a public forum asking for guidance

[northernladuk]

couldn't agree more ... more research is needed. heres some for you... in terms of a consistant measure of value (ie gold) prices have already crashed ... big time.

past performance is not an indicator of future performance ... the era of house prices doubling every ten years are gone. We are turning into Japan

My first reaction reading this is you can write about anything if you want a shock headline but it doesn't mean anything. You compare the price of your house against a rising commodity? So what? Does that really affect the house price or how much a pound of butter is? You get my meaning? If you really want a shock headline why didn't he compare the price of house against a loaf of bread. Bread has gone up 2000% in 50 years. That will make your house price a bit sick. It doesn't really make much difference to the man in the street. I only have a basic knowledge of economy but I don't see this comparison as one to consider really.

If you think house prices have crashed why not buy then?

My take on all this is..Your house is your home. Whatever goes on around you you have a home and you need to keep hold of it. If you are lucky enough to buy in a dip then great, if you didn't that's life but at least you have a home. It is not an investment, it isn't something you are going to make anything on until you retire and it is so long term. You can take advantage of peaks and troughs though. Upgrade when there is a crash so you get a bigger house that has lost more, downsize in the boom times so you the increase on your house is more. Whatever you do you still have a home.

I maybe missing a trick here by being blinkered but I am happy to be so as long as I have a home and ability to pay it off as quickly as possible. This is my opinion of course.

[SueEllen]

past performance is not an indicator of future performance ... the era of house prices doubling every ten years are gone. We are turning into Japan

This isn't the first property boom followed by a bust we have had in the UK. There was one in the late 80s/early 90s, so I expect another one to be had in another 10 years. The only way to stop them is increased house building of properties that aren't cramped one/two bedroom.

[hgllgh]

Yes.


No.
House prices continue to climb, esp so in London and for prime properties:

House Price Index | House Price Trends & News | Primelocation

Think you need to do more research.

It also depends on how you look at the property, if its a long term investment then historically house prices double (approx) every ten years.

couldn't agree more ... more research is needed. heres some for you... in terms of a consistant measure of value (ie gold) prices have already crashed ... big time.


Britain's secret house price crash - MoneyWeek

past performance is not an indicator of future performance ... the era of house prices doubling every ten years are gone. We are turning into Japan

[Mister Clark]

so as long as you don't take more than 60K in salary and divs then you qualify? so these schemes are open to contractors then?

I'm not quite with you ... if the price goes up and you sell, you get the increased amount as your % is still the same. so you can pay off the original mortgage and pocket the extra?

Yes.

moot point really as prices are only going to go down. yeh i will start looking at repos and BMV ... its the only part of the housing market thats going to grow

No.
House prices continue to climb, esp so in London and for prime properties:

House Price Index | House Price Trends & News | Primelocation

Think you need to do more research.

It also depends on how you look at the property, if its a long term investment then historically house prices double (approx) every ten years.

[northernladuk]

so as long as you don't take more than 60K in salary and divs then you qualify? so these schemes are open to contractors then?

If you are going to come up with some hair brained scheme why don't you look in to the details first? I don't know anything about this type of thing but I would have thought it was to help people get on the property ladder and a 60K income doesn't strike me as someone that needs help on the property ladder. Could be wrong but you are the intereted one so go read up on it.

[MarillionFan]

What's a mortgage?

[hgllgh]

so as long as you don't take more than 60K in salary and divs then you qualify? so these schemes are open to contractors then?

I'm not quite with you ... if the price goes up and you sell, you get the increased amount as your % is still the same. so you can pay off the original mortgage and pocket the extra?

moot point really as prices are only going to go down. yeh i will start looking at repos and BMV ... its the only part of the housing market thats going to grow

[Mister Clark]

I looked into a similar sounding scheme earlier in the year.

Obviously they will differ but the deal breaker for me was the price of the property I was interested in was fixed and they would not (could not, if you believe the developer) go into negotiations.

Needless to say the property was grossly overpriced in my opinion based on the current climate.

My advice is to look at repositions - I picked up a property that was first sold in 2005 for £300,000 for £240,000 this year.

EDIT: Pretty sure that’s the same scheme I looked at.

Yes, you can mitigate some of the risk of house prices falling if the property you are looking at is priced well in the first instance. Check it out but I'm sure you can't haggle with regards to price.

The other down side is if the value of the property goes up so does the amount you have to repay when you sell or wish to buy a larger percentage of the property, although relativley speaking the percentages stay the same.

[hgllgh]

thanks for the reply. i could definately get into a debate about the risks to your capital when buying in london with prices still high but i really just want to find out if anyone has used the scheme? ...

[northernladuk]

This doesn't make sense to me at all but could be because I don't understand the scheme but why would a contractor want to take an option designed for people that can't afford their own homes? The whole idea of contracting is to be rich so why would you not get yourself a mortgage and start paying the house off.

That aside when they look at your income they will take divis in to account so will be extremely difficult to be eligible.

Whatever the housing market is going to be like in the future I am a big believer that you get your house sorted first as it is long term and it is your home. Even if I didn't have a house but the ability to buy one I would get my own house. I aint letting the gov own 75% of my home!!!!

[hgllgh]

have any contractors used these gov first time buyer schemes?

i think house prices will fall further (a complete collapse has only been avoided by ridiculously low interest rates) so it looks like a good way of getting the government (effectively) to take the risk. If they own 75% of your mortgage and the market crashes and you sell, they are taking the most of the hit.

so, has anyone used the scheme?
i think you have to be earning below 60K per year so not sure how they would treat non IR35 contractor earnings?