surviving the recession

The property experts say that house prices will fall another 9-10% in 2009, thanks to banks being unwilling to lend to any but the most creditworthy customers plus demands for a large deposits to be put down.

Of course property never stays down forever, at some point pent-up demand and restricted supply due to strict planning permission means that prices will rise again. So it makes sense to try to buy at the bottom.

However, for most people this is out of the question. They are carrying too much debt at present, and cannot afford to take on another property. By the time lending criteria relax so you can buy more than one home, property prices will already be rising and the bargains will have gone.

How to get round this? Pay down your existing mortgage as fast as possible, and start building up a nest egg to put down as a deposit on a second property. If you have reduced your current mortgage sufficiently and are able to put down a large deposit on the second home, you should be able to be classified as an extremely good credit risk, so that lenders will lend on the second home.

It sounds impossible, but read some of the articles on this blog about how to raise money, and do as much as you can to pay off debt. Property prices will start to move up at the end of next year, and this once-in-15-years opportunity to buy a place very cheap will disappear.

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