Cyprus Eastern Forum Archive


This is a text archive version of our main content. To view the full site with more information, features, formatting and images please click here.

>> Eastern Cyprus Forum Archive Index

View The Full Original Topic: The psychology of property prices


>> Have YOUR say - Post A Reply To This Topic

Posted By: geoffreys

  • LynSab wrote:
    I am of the opinion that your home IS your biggest investment! Most expect it to be worth more than what they paid for it surely? Then in future times when/if circumstances in your life change that investment could help change it.
    I've moved only three times in the UK in 32 yrs! the last property we lived in was for 18 yrs, we also bought property that was rented out, which we improved and sold before we came to live here. We became mortgage free in the UK in 2004, the same time we bought a holiday home in Cyprus again mortgage free. This was the result of investing in property in the UK plus running our own business for years. The property bought in Cyprus ( our holiday home) in 04 was sold in 07 at a reasonable profit, more than half of which disappeared to estate agents, lawyers and since, after a dispute CGTs, we were duped by others over those as well, finally we had to give in, so the first not so profitable investment we have ever made.
    Too late we realised that our current home built in 07 completed 08 and came with land deeds on completion was bought at the tip of a global recession, now it's price will never rise for years! But we will sell it only at what we paid no less. Eventually in three to five years we should realise a small profit, but who knows? The first time in years we have done the wrong thing.... :( :(
    That is the problem, many who bought here even safely, now realise they will not get a return on their investment, even if they are lucky to find that elusive buyer. It's a mess..but there is only one way to go once at the bottom isn't there? :roll:
    As an aside our first property here sold in 07 was ours entirely? ( paid for in full) but no...the new buyer from Nicosia was instructed to make out the balance of the sale, a cheque for over €100k to the name of the developer, when I had successfully paid the €6k cancellation fee :roll: :roll: Then I went with THAT cheque, not made out to me from the sale of my property owned in full by me, to the BoC to see how I could pay it into my account, a phone call was made to the developer in Kapparis and miraculously the money got deposited in my account. We nearly bought another property as an investment, thank heavens we didn't, owning more than one property now in this current climate unless you bought them at rock bottom prices years ago will never realise a return for years, and in that time you will have to maintain and refurb. All our Cypriot friends have bought property in London have refurbed it and rented it out, this is IMO the way to make a correct investment in property for the future. They sold property here in Cyprus at ridiculously low prices to invest in the UK.
    Scam scam scam scam scam! I will never forgive that developer, and I hope they go down before long. I would be delighted if they are now suffering financially. They all deserve to IMO.

I could not agree more Lynn.
I first had a mortgage in UK back in 1970 and by working overseas tax-free paid it off in 4 years. I have never had a mortgage since, anywhere.
But I always regarded house purchase primarily as a home, as well as an investment.
In UK I inherited a second house but had to sell it to pay off nursing home fees for my late wife.
And so it goes on - things change, credit crunches, Title Deeds fiascos, Euro crisis etc.
Like you we have somewhere nice to live in a Country we want to live in, although I understand your views that you will retire elsewhere longterm, and why.
However the various property scams etc here should be addressed properly by the Cyprus Govt, and it is up to all of us to keep the pressure up on them; whether on an individual basis or via a Group such as PICAS.
Meantime I have taken Steve's (forum Admin) good advice and got my Solicitor to write to the Head of the Land Registry about our case.
Geoff



Posted By: Alan3

  • Denise55 wrote:
    It depends when you are talking about Tang. In general prices in Cyprus are now at the same level as off plan prices in 2003. Anyone buying after that are very likely in negative equity.

The use of the word 'anyone' is probably a bit extreme.
'Negative Equity' is only applicable when the the value you can obtain for a property is less than what you owe on that property (usually to a bank).
People who took out an interest only mortgage are likely to have 'Negative Equity'. But those who paid by other means will not have.
Although they may still feel they 'got a bad deal'.

Posted By: Denise55

Looks like I'm not alone in my view that the property market in Cyprus is not set for revitalisation any time soon, title deeds situation or not, and that the main problem is that the people in the market to buy property do not earn enough to be able to get one.
http://www.news.cyprus-property-buyers.com/2012/06/06/the-world-has-turned-upside-down/id=0011643?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+CyprusPropertyNewsStories+%28Cyprus+Property+News+Magazine%29
Cypriot real estate – Residential and commercial real estate remains overpriced, even though in the coastal districts of Paphos and Famagusta residential prices have fallen by 30-40%. Residential prices remain out of kilter with their long-term price to income multiple, whilst commercial property is suffering from higher vacancy rates resulting in lower rents, and from higher initial yields.
This thread though was never supposed to be specifically about Cyprus, more about the thought processes behind the thinking that something going up in price, to the exclusion of almost anything else, was a good thing.
I suppose you're never going to get a good representative sample of opinions when almost everyone on the forum owns one property and a good number own more than one, although some did recognise that rises in house prices pushes up inflation.

Posted By: scottie

We sold up in the UK in the 90's and we sold in the "dip" not at a loss but at a break even price. Fortunately when we came here house prices were reasonable and we were able to buy the house we still live in at a reasonable price so, swings and roundabouts. In two years the house we had left had doubled in price. The difference between then and now is this is a world wide recession no younger people in any country seem to be able to get on the ladder even if they choose to move elsewhere. House prices in the UK have dropped but rents do not seem to have followed the trend. What is the answer who knows ? Life throws these curves at one and we have to roll with them. I too wish we had rented due to reasons other than finance. However trying to sell now is nigh on impossible as has been said many times . Why.......We are in a recession. Let us hope not a long one

Posted By: Denise55

I agree with what Lyn says BUT, that was then and this is now. I think all people now in their 50s, 60s and 70s have been in a unique position in that we were able to buy low and move each time able to upscale due to rapidly increasing prices and wages. What those years haven't done though is build a decent base for the future. What chance now do the young have to do what we were able to do? We bought our first house for £5250 and joint earnings were about the same pa. We bought our 2nd house for £21000 when in our mid 20s with joint earnings of about the same and it was relatively easy to get a 90% mortgage. That house now, since the fall in property prices is worth about £140,000. How many couples in their mid 20s earn £70,000pa each and how on earth do they save a deposit of £28-35,000 which is the legacy that our generation of plenty has left them? Many top graduates find it difficult to get a job in any event never mind at that sort of level. Incidentally, talking about prices to rent in Cyprus, rental prices have dropped through the floor in Cyprus. What you could get 4 years ago has roughly halved since. Tang, you have to remember that 2003 prices were CYP£ so whereas you could buy a one bed property then for about CYP£35,000, that now equates to nearly €60,000 so I stand by what I said. Try getting what you paid even initially never mind after you've paid all the charges. As Lyn quite rightly stated, 2007 was the peak of the market in Cyprus and I feel every sympathy for those who bought then, particularly with a mortgage and need to sell now. Whilst there is a chance to sell a coastal property to wealthy Nicosians as a holiday home, the inland villages where the locals want to buy the prices are still too high for them. We took an €80,000 (73K before expenses) loss last year on a property just to get rid of it. I didn't want to hold out for a higher offer and be in the position of thinking 6 months later that it had been a generous offer and in the event I have been proved right as they are still falling. I'd rather have the money then than wait 5-10 years or more, who knows, to get my money back not knowing if I ever would and meantime pay communal charges. Luckily it was mortgage free so no interest rates to worry about.

Posted By: LynSab

I am of the opinion that your home IS your biggest investment! Most expect it to be worth more than what they paid for it surely? Then in future times when/if circumstances in your life change that investment could help change it. I've moved only three times in the UK in 32 yrs! the last property we lived in was for 18 yrs, we also bought property that was rented out, which we improved and sold before we came to live here. We became mortgage free in the UK in 2004, the same time we bought a holiday home in Cyprus again mortgage free. This was the result of investing in property in the UK plus running our own business for years. The property bought in Cyprus ( our holiday home) in 04 was sold in 07 at a reasonable profit, more than half of which disappeared to estate agents, lawyers and since, after a dispute CGTs, we were duped by others over those as well, finally we had to give in, so the first not so profitable investment we have ever made. Too late we realised that our current home built in 07 completed 08 and came with land deeds on completion was bought at the tip of a global recession, now it's price will never rise for years! But we will sell it only at what we paid no less. Eventually in three to five years we should realise a small profit, but who knows? The first time in years we have done the wrong thing.... :( :( That is the problem, many who bought here even safely, now realise they will not get a return on their investment, even if they are lucky to find that elusive buyer. It's a mess..but there is only one way to go once at the bottom isn't there? :roll: As an aside our first property here sold in 07 was ours entirely? ( paid for in full) but no...the new buyer from Nicosia was instructed to make out the balance of the sale, a cheque for over €100k to the name of the developer, when I had successfully paid the €6k cancellation fee :roll: :roll: Then I went with THAT cheque, not made out to me from the sale of my property owned in full by me, to the BoC to see how I could pay it into my account, a phone call was made to the developer in Kapparis and miraculously the money got deposited in my account. We nearly bought another property as an investment, thank heavens we didn't, owning more than one property now in this current climate unless you bought them at rock bottom prices years ago will never realise a return for years, and in that time you will have to maintain and refurb. All our Cypriot friends have bought property in London have refurbed it and rented it out, this is IMO the way to make a correct investment in property for the future. They sold property here in Cyprus at ridiculously low prices to invest in the UK. Scam scam scam scam scam! I will never forgive that developer, and I hope they go down before long. I would be delighted if they are now suffering financially. They all deserve to IMO.

Posted By: geoffreys

  • journo wrote:
    • geoffreys wrote:
      YES, prices in Cyprus are still falling, and I don't think that will change until people from outside the Island feel confident once again to buy here.
      They would feel a bit more confident if they knew they get the title deeds as soon as they complete their purchase. Just like in UK for example.Geoff

    Since when has anyone buying in the UK on a mortgage ever received their Title Deeds when the sale was 'completed'? The Bank/financier holds the deeds.. assuming there were any in the first place, which in a number of instances, there weren't/aren't.

I was talking about where there is no mortgage, which is common amongst retirees here in Cyprus. In UK, if no mortgage, you get the Deeds immediately.
If you have a mortage the situation is safe in UK (as long as you don't default), unlike here.
Geoff

Posted By: Tangutica

  • journo wrote:
    • geoffreys wrote:
      YES, prices in Cyprus are still falling, and I don't think that will change until people from outside the Island feel confident once again to buy here.
      They would feel a bit more confident if they knew they get the title deeds as soon as they complete their purchase. Just like in UK for example.Geoff

    Since when has anyone buying in the UK on a mortgage ever received their Title Deeds when the sale was 'completed'? The Bank/financier holds the deeds.. assuming there were any in the first place, which in a number of instances, there weren't/aren't.

Plenty of property down in the west country with no title deeds. However, you are told about this and can take out an indemnity to cover yourself should the original owner rise from the grave or wherever and all that.
As for since when ... well since the last two houses I bought in the UK because I bought them cash without requiring a mortgage. However I did then pass the Deeds over to my solicitor for safekeeping (wise if you are prone to losing passports, spectacles, etc)
But I DO take your point. I would like a pound for every time I've said to someone who talks about THEIR house 'you will soon find out WHOSE house it is if you stop making your mortgage payments'. It belongs to the person who holds the TDs (which you ain't gonna get until you've paid every last cent off that mortgage).
Seems to me that, in Cyprus, because people had PAID IN FULL they didn't recognise that the house belonged to whoever held the title (whether it was to the land or whatever) but did not belong to them free and clear if they did not.
Or, I'd say, try selling it without deeds (if it was bought off plan) you will find you have to pay the developer to release you from the contract with him and 'your' buyer will effectively become 'his' buyer.
I disagree about using 2003 as a marker saying anyone buying after that is on a loser. As I said above, there were plenty of properties (albeit small ones) to be bought (off plan) for under 30K and I don't see too many of those now.
On the plus side Cyprus is somewhere (unlike the UK) where you can rent a lot cheaper than you can buy (paying a mortgage). And BOY AM I GLAD that's what I decided to continue doing! Phew! Wasn't a hard decision, I had a close relative in the property business over here at the time - had been here since before Cyprus went into the EU and when properties here were way cheaper than they were in Spain say.
I saw at close quarters what a decidedly dodgy business it all was. And made my mind up VERY quickly not to get involved with it at all.
But it is worth remembering that back then there were not all that many RESALES to be had in Cyprus.





Posted By: Denise55

That may be so journo but in the UK it's only your own debt that stops you having your deeds. You are in charge of your own destiny not at the mercy of a castle built on sand. And you're free to do what you want with your own house, subject to planning laws.

Posted By: journo

  • geoffreys wrote:
    YES, prices in Cyprus are still falling, and I don't think that will change until people from outside the Island feel confident once again to buy here.
    They would feel a bit more confident if they knew they get the title deeds as soon as they complete their purchase. Just like in UK for example.Geoff

Since when has anyone buying in the UK on a mortgage ever received their Title Deeds when the sale was 'completed'? The Bank/financier holds the deeds.. assuming there were any in the first place, which in a number of instances, there weren't/aren't.

Posted By: shuggybear

  • Denise55 wrote:
    Something to think about.
    Why do we feel that property prices rising are a good thing?
    Who does it benefit?
    If you fill your car with petrol and it costs you £70 today then goes up and tomorrow it will cost you £100 do you feel richer because your asset is worth more? Would you feel poorer if it went down to £50?
    In general the person buying a property never benefits from rising property prices. He has to live somewhere so if he sells one for more then he necessarily has to pay more for his next home.
    A lot of people in Cyprus think the market would be transformed if the government suddenly issued all the outstanding deeds. Whilst it is undeniable that people would feel more secure in their homes and would be free to extend them etc, it is my opinion that prices would continue to fall for reasons quite outside the title deeds fiasco.
    Isn't it time we stopped thinking about property as an investment but as what it should be, a home?

yes but but but is it our home or the bank/developers because untill i get my title deeds it is not mine ????????????

Posted By: Kwacka

  • Denise55 wrote:
    Something to think about.
    Why do we feel that property prices rising are a good thing?
    Who does it benefit?[/quoet]
    If you fill your car with petrol and it costs you £70 today then goes up and tomorrow it will cost you £100 do you feel richer because your asset is worth more? Would you feel poorer if it went down to £50?

It doesn't depend on the price you paid, it depends upon what someone is willing to pay for it - be it petrol or houses.
If you have a full tank & the petrol stations are closed then you can sell at a higher price than you paid for it IF someone has a more desperate need for petrol.
    Quote:
  • Isn't it time we stopped thinking about property as an investment but as what it should be, a home?

Bought a house 30 years ago, solicitor told us with our salary we should be looking at something up to three times the price. He thought we were crazy when we said we liked the house & location and weren't planning on selling in a couple of years.

Posted By: scottie

I did not answer your question as I was not on here all day and when I came back on Tang had answered for me. I said one of the measures noted re the growth of an economy and one which is quoted regularly n any debate about the same was the house prices. As this was the topic and not GDP I did not feel I had to elaborate. I will miss you

Posted By: Denise55

I really don't have the patience to talk to you. I have not advocated anything. I have not told anybody to do anything, although I did suggest you read up on GDP earlier which you've conveniently ignored. People are free to do what they like, legally. Now I'm going to ignore you because you're not worth my time and energy further.

Posted By: scottie

Oops my mistake thought I was in the General section not the debate. However it does not answer why you advocate one thing one day and another a few days later. I would call that an argument not a debate. As a former chai rperson of a very well known debating society I do know the difference. See EU getting the Jitters......post 39 May 25th.



Posted By: Denise55

  • geoffreys wrote:
    • Alan3 wrote:
      I'm with you on that one.

    So am I actually.
    We bought in 2003, no idea what it is worth now, couldn't care less really as it is our home.
    Prices will come back up eventually, they always have and always will, - but timescale? Who knows.
    What say Denise55??
    Geoff

That really is my point Geoff. The value of your home doesn't really matter if it is your home and provides the roof over your head.
I wouldn't put a timescale on property prices rising again. Whether they will to any significant level I am rather sceptical about.
Thing is, your statement that they always have and always will, is the debatable point. It is the ethos we've been conditioned to for many years but it may no longer be the truth.

Posted By: Denise55

  • scottie wrote:
    I am totally confused by this post. Is this not the same poster ( is that a word ) who only the other day was championing the poor people in the UK who had bought property here and in her words " do not live here never intended living here but bought them as an investment " who is now telling others they should not buy property as an INVESTMENT but as a HOME ? Shot in the foot

I'm not telling anybody to do anything. I'm asking for opinions but you can't seem to take that on board. It's called debate. It's no surprise to me that you are confused.
Losing money on a legitimate investment is one thing. Fraud is another thing entirely.

Posted By: geoffreys

  • Alan3 wrote:
    I'm with you on that one.

So am I actually.
We bought in 2003, no idea what it is worth now, couldn't care less really as it is our home.
Prices will come back up eventually, they always have and always will, - but timescale? Who knows.
What say Denise55??
Geoff

Posted By: Alan3

I'm with you on that one.

Posted By: Denise55

Very true Alan. What I should have said is that anyone buying after 2003 is unlikely to get back what he paid for his property even without taking into account what has been spent on it.

Posted By: BillG

Geoff, If I were you I would start learning Russian. All the TV ads there are appealing to the mass market (ex Lada factories) to get out of stinkinggrad and go take a pound out of Cyprus. Everything is cyclic as you say, like the Raj, Kenya, Rhodesia, South Africa et al but in the end wherever you escape to will be over-run by the next mass market. Sadly for the Cyps these guys don't play by the rules and don't pay top dollar. They don't see them as being "quaint" just6 as the next conquest. The Russians are coming and in my7 experience, it is time to leave Cheers Bill

Posted By: DAC

  • Denise55 wrote:

    Isn't it time we stopped thinking about property as an investment but as what it should be, a home?

No!



Posted By: zero

IMHO prices need to drop another 30% to be priced realistically in Cyprus.Then they can slowly grow over the next 6 to 10 years while the rest of the world economy is getting back to normal.

Posted By: Denise55

The answer to your last question Geoff is the reason that I don't think there will be any major revitalisation of the Cyprus market. It has been vastly over developed. There is no demand form UK buyers which was previously Cyprus' 2nd biggest source of property buyer. Brits are not buying in Cyprus because of the title deeds problem, they are simply not buying anywhere in the same numbers as previously.

Posted By: geoffreys

  • Denise55 wrote:
    Sorry Geoff you are wrong. It is not vice versa. Increases in prices MAY, in the short term only, lead to an increase in demand, but there comes a point when it is entirely unsustainable and that is where the economy has been for the last few years.
    Only time will tell of course but the fact is that prices in Cyprus are still falling.

Yes and no. I DID say the thing was cyclic, and it gets thrown off normal course by other factors, I mentioned some in Cyprus, Spain, Greece.
And YES, prices in Cyprus are still falling, and I don't think that will change until people from outside the Island feel confident once again to buy here.
They would feel a bit more confident if they knew they get the title deeds as soon as they complete their purchase. Just like in UK for example.
Believe me when I say Buyers are more fickle than Politicians these days.
If falling prices are a good thing how come no one is buying??
Geoff

Posted By: chris

During the 'boom years' (2004 - 2007?) the developers who built our house did very well, so well in fact that they spent their profits on new double cab trucks, new cars, and building houses for their children. :D Had they known what was coming, they would have been wiser to have put their profits in the bank, because now their company is no longer trading and the only work they have is as 'jobbing' builders working for other developers. As to current house prices, despite the fact we purchased in 2004-05, we will need to wait for the housing market to recover before the value of house will equal what we paid out for it. :x Chris

Posted By: Denise55

Said by who though Tang? It may be that people personally perceive their own economic situation by the price of their property but it is certainly not what makes the wheels of commerce turn.

Posted By: Tangutica

  • Denise55 wrote:
    • scottie wrote:
      Common sense there Geoff. That is probably why all countries use house prices as a main indicator to the state of a countries economy

    Would you like to name one country, never mind all the countries, that use house prices rather than GDP and other economic factors to indicate the state of the economy?

Not going to name countries doing what you say but it has been said for many years, that the UK Economy has been too closely tied to the Property Market there.

Posted By: Denise55

Sorry Geoff you are wrong. It is not vice versa. Increases in prices MAY, in the short term only, lead to an increase in demand, but there comes a point when it is entirely unsustainable and that is where the economy has been for the last few years. Only time will tell of course but the fact is that prices in Cyprus are still falling.



Posted By: Denise55

It depends when you are talking about Tang. In general prices in Cyprus are now at the same level as off plan prices in 2003. Anyone buying after that are very likely in negative equity.

Posted By: geoffreys

  • Denise55 wrote:
    • geoffreys wrote:
      • Denise55 wrote:
        Oh I don't dispute that at all and it is ludicrous the amount the government is throwing away because each time a property changes hands without deeds they lose out on a set of transfer fees.
        However, the thread wasn't really meant to be about deeds or even particularly Cyprus. It is about the train of thought that property prices rising is ever a good thing.

      Sorry if I digressed to much, but they are inter-related.
      If property prices increase it increases demand and the construction industry booms, the economy booms, jobs galore, etc.
      Always provided there are no toxic loans involved of course!
      So it seems to me to be a positive thing.
      Some however argue that lower prices make house purchase for the 1st time buyer affordable. True, but then the cycle starts againas a result.
      Geoff

    I think you've got your economics the wrong way round there Geoff. Increase in demand leads to house price increases. That necessarily increases demand for higher wages which leads to higher prices for all other commodities.
    As to construction, talking of Cyprus now, there has been a massive over supply of property way exceeding demand. That is one of the reasons for the falls amongst others.

Chicken and egg Denise. Increased demand causes increases in price, and vice versa, Cyclic.
What made prices drop worldwide was the credit crunch.
In Cyprus that was made worse by the Title Deeds fiasco, in Spain by the Land Grab, in Greece the failing economy.
Geoff

Posted By: Tangutica

If by a 'fall' in property prices you mean that someone cannot now get what they paid for their property a year or more ago - I understand they see that as a 'fall'. In that case property prices have DROPPED since they bought. Isn't that simple in Cyprus - most I know who grumble about 'falling property prices' bought off plan for a song and are complaining that they cannot now get €120K for an apartment they bought off plan a few years ago for less than €50K! And in some cases less than that. I know very few who bought at the peak and most of them react in a shell shocked manner when they hear what others bought similar in the area for a few years previously. Even so, certainly for apartments, they could sell them if they were prepared to sell for around what they paid. Alas too few are prepared to do that. They were told it was a good investment, couldn't fail to make money, and against all the odds they are hanging onto that belief. Banks aren't helping - they want inflated property prices if they are using them as collateral for loans they've shelled out. I live in a huge block. Some paid just £25K for one bed apartments here off plan - others paid £40K for the same apartments (bought from a different estate agent) then, unbelievably, just after finished built - some paid £80K for same thing! Some paid £40K for 2beds and others paid £80K for the same 2beds slightly further down the line. The ones who paid more are, naturally GUTTED when they find out what others paid. But you end up with a situation where one is prepared to sell a 1bed for £50K (still making a nice profit) and another owner of a similar apartment is screaming that they cannot 'afford' to sell for less than they paid, even if that amount is twice what someone else paid for theirs and is happy with. If you can see what I am getting at here! There are 3 apartments owned by same person on my floor - a 2bed and 2 1beds - they paid a grand total of £85 Sterling for all three off plan. There is another, next door to them, which cost the owners more than these three put together! There are about 4 owners who bought 3, 4 or even 5 properties in the same building here. Seems to be that the more you bought, the cheaper you got them! A REALISTIC Cypriot owner told me that if he just sold one of the larger ones he owns - he would have covered what he paid off plan for all 4 of his. And that would be selling it at a realistic price. We've got 1beds for sale here at the mo for €135K lol! And 2beds for €180K! Of course there is no interest in them whatsoever but it does provide a bit of amusement for some living here. So - increasing or decreasing. Increasing from what? From what was PAID or from what was said it was 'going to be worth' or what some changed hands for at the very peak? I sold my house in the UK 6 yrs ago. It was recently sold again by the lady who bought it from me. She sold it for 35K less than she paid me for it. I call THAT a DROP in prices. I sold it cheaply for a very quick cash buyer sale and a buyer who would play ball with when I wanted to move out. I sold it within days of putting it on the market. She's had it up for sale for a year or more and cannot get what she paid for it.

Posted By: Denise55

  • scottie wrote:
    Common sense there Geoff. That is probably why all countries use house prices as a main indicator to the state of a countries economy

Would you like to name one country, never mind all the countries, that use house prices rather than GDP and other economic factors to indicate the state of the economy?

Posted By: Denise55

I wouldn't disagree with that at all Tina but that is only a small minority of the overall market, and as you say, a thing of the past. Making a killing could be a very good phrase in this context because selling to someone at the peak of the market could mean killing off the quality of the person buying in that they have to work themselves to death to pay for it. However, by far the greater majority of people buy a house to live in. In the UK we have had an ownership fetish for some 40-50 years. Prior to that it was not possible for the average working man and even then not possible for many. Some other countries with strong economies have always seen renting as a much more preferable option. I take the point I've seen you make elsewhere that renting a property does not make it like home but isn't that a state of mind? I've certainly come to realise that renting offers you a flexibility that ownership never can. At the moment I'm somewhere in the middle of thinking which is best.

Posted By: Tina Torment

  • Denise55 wrote:
    If you fill your car with petrol and it costs you £70 today then goes up and tomorrow it will cost you £100 do you feel richer because your asset is worth more? Would you feel poorer if it went down to £50?

An asset to who lol! To the damn garage more like.... :evil:
  • Denise55 wrote:
    In general the person buying a property never benefits from rising property prices. He has to live somewhere so if he sells one for more then he necessarily has to pay more for his next home?

Buyers do not benefit from rising prices, sellers do. 8) Having worked for several years in estate agents, I found that people sell for all sorts of different reasons & buyers purchase not necessarily for investment.
During the UK housing 'boom' years, many home owners (especially in the south) made a killing by selling on their inner city property, down sizing, moving to rural areas or even abroad. They didn't necessarily have to purchase another home either, they could invest at a good interest rate & rent out of the interest made. Those days are gone! :(

Posted By: Denise55

  • geoffreys wrote:
    • Denise55 wrote:
      Oh I don't dispute that at all and it is ludicrous the amount the government is throwing away because each time a property changes hands without deeds they lose out on a set of transfer fees.
      However, the thread wasn't really meant to be about deeds or even particularly Cyprus. It is about the train of thought that property prices rising is ever a good thing.

    Sorry if I digressed to much, but they are inter-related.
    If property prices increase it increases demand and the construction industry booms, the economy booms, jobs galore, etc.
    Always provided there are no toxic loans involved of course!
    So it seems to me to be a positive thing.
    Some however argue that lower prices make house purchase for the 1st time buyer affordable. True, but then the cycle starts againas a result.
    Geoff

I think you've got your economics the wrong way round there Geoff. Increase in demand leads to house price increases. That necessarily increases demand for higher wages which leads to higher prices for all other commodities.
As to construction, talking of Cyprus now, there has been a massive over supply of property way exceeding demand. That is one of the reasons for the falls amongst others.





Posted By: scottie

You do have lovely eyes

Posted By: Denise55

:roll:

Posted By: scottie

Common sense there Geoff. That is probably why all countries use house prices as a main indicator to the state of a countries economy

Posted By: geoffreys

  • Denise55 wrote:
    Oh I don't dispute that at all and it is ludicrous the amount the government is throwing away because each time a property changes hands without deeds they lose out on a set of transfer fees.
    However, the thread wasn't really meant to be about deeds or even particularly Cyprus. It is about the train of thought that property prices rising is ever a good thing.

Sorry if I digressed to much, but they are inter-related.
If property prices increase it increases demand and the construction industry booms, the economy booms, jobs galore, etc.
Always provided there are no toxic loans involved of course!
So it seems to me to be a positive thing.
Some however argue that lower prices make house purchase for the 1st time buyer affordable. True, but then the cycle starts againas a result.
Geoff

Posted By: Denise55

Oh I don't dispute that at all and it is ludicrous the amount the government is throwing away because each time a property changes hands without deeds they lose out on a set of transfer fees. However, the thread wasn't really meant to be about deeds or even particularly Cyprus. It is about the train of thought that property prices rising is ever a good thing.

Posted By: geoffreys

  • Denise55 wrote:
    Something to think about.
    Why do we feel that property prices rising are a good thing?
    Who does it benefit?
    If you fill your car with petrol and it costs you £70 today then goes up and tomorrow it will cost you £100 do you feel richer because your asset is worth more? Would you feel poorer if it went down to £50?
    In general the person buying a property never benefits from rising property prices. He has to live somewhere so if he sells one for more then he necessarily has to pay more for his next home.
    A lot of people in Cyprus think the market would be transformed if the government suddenly issued all the outstanding deeds. Whilst it is undeniable that people would feel more secure in their homes and would be free to extend them etc, it is my opinion that prices would continue to fall for reasons quite outside the title deeds fiasco.
    Isn't it time we stopped thinking about property as an investment but as what it should be, a home?

Even if you are right that if the Title Deeds fiasco was resolved property prices would/might still continue to fall - the fact is the issue of such a backlog of Deeds would more or less sort out the Govt's cashflow problems and avoid an EU bailout as they would receive millions in transfer fees. That would be good news for everyone since an EU Bailout would result in increased taxes etc.
Geoff

Posted By: Denise55

Something to think about. Why do we feel that property prices rising are a good thing? Who does it benefit? If you fill your car with petrol and it costs you £70 today then goes up and tomorrow it will cost you £100 do you feel richer because your asset is worth more? Would you feel poorer if it went down to £50? In general the person buying a property never benefits from rising property prices. He has to live somewhere so if he sells one for more then he necessarily has to pay more for his next home. A lot of people in Cyprus think the market would be transformed if the government suddenly issued all the outstanding deeds. Whilst it is undeniable that people would feel more secure in their homes and would be free to extend them etc, it is my opinion that prices would continue to fall for reasons quite outside the title deeds fiasco. Isn't it time we stopped thinking about property as an investment but as what it should be, a home?

Posted By: scottie

I am totally confused by this post. Is this not the same poster ( is that a word ) who only the other day was championing the poor people in the UK who had bought property here and in her words " do not live here never intended living here but bought them as an investment " who is now telling others they should not buy property as an INVESTMENT but as a HOME ? Shot in the foot


[ ADVERTS: UK Stores Delivering To Cyprus | Find eBay Misspellings - Grab A Bargain! ]



Viewing Cyprus Eastern Forum Archive - Lo-Fi Version | Visit Cyprus Eastern Forum - Full Version | Questions?

TOP TIP: BUYING PROPERTY IN CYPRUS? PLEASE ENSURE THAT YOU SEEK INDEPENDANT LEGAL ADVICE FIRST.
Cyprus forum covering Kapparis, Protaras, Pernera, Agia Napa, Agia Thekla, Paralimni, Larnaca, Oroklini, Pervolia & surrounding areas
Please note that the views expressed on this forum are those of the author and may not reflect the views of the management.