Newbie;130758 wrote:For what it is worth
A property in London - buy it especially where you plan in living in it.
Show me evidence where the property prices in London have come down over the long term.
Agree with the above in that your next move is not really affected in that if property prices fall it will be in line with your next move provided it is in a like for like area.
You paying rent at the moment.
Someone mentioned that you could rent and invest. Though theoretically correct it does not anticipate the rent increases. At the moment there is great demand for rental properties such that I am aware rental agencies and landlords moving out existing tenants to replace them with new ones so that they can increase the rents by up to 20% as opposed to a mere 5% annual increase with the existing tenants.
Rent controls which I doubt will be brought in - is only likely to affect existing tenancies and not new ones. Hence why switch out tenants. Yes there are costs but these get passed down.
Being in London it should not be hard to rent out. Remember that the city of London is welcoming to anyone who has monies with no serious issues about where the monies came from.
On top London property prices do not reflect the movements of the national property price movements. There is a big disjoint. If you were buying in the north then I would say hold fire ! Where I live property prices and rents are going up.
Worst case scenario - think of it as as an investment - if you were to move out you could release the equity to help with the next purchase and then rent this out. Any movement in the price will be reflected as the base for CGT purposes down the line.
One thing that is often overlooked is that house prices work in conjunction with Bank lending (and not not bank interest rates alone). A lot of wealthy people I know started releasing equity by way of remortgaging and having spare cash to hand before the the banks started pulling lending.
Lo and behold the banks have now started dragging their heels with lending on property (in fact various lenders have been increasing the rates which were applied / agreed).
The same happened in 2008 - people took out the maximum the bank allowed before the banks started taking away their limits (the amount which they could borrow) to shore up their capital. For these people recession is for the poor, for the others it is an opportunity to pick up assets on the cheap.
Hope this helps.
Thank you Newbie your words are worth much and yes, it does help.
I think that although there will always be cheaper or better properties coming on the market, time is relative in a sense.
I recall the bank failure of 2007-9 and experienced a slump that I thought would never recover. But it did so in time.