Saturday, December 22, 2007

Moving House Conundrum

As I blogged recently we are looking to move house and we are now being set quite a conundrum.

We found a house earlier this month that really meets our needs and we feel that we could stay until death us do part, or at least until we need to go in to care. We made a few offers and gradually moved up to something an offer the estate agents recommend the sellers accept.

It was then we found out that the sellers aren't in a hurry to move because the house they want isn't on the market and won't be coming on for a few months because it is in probate. If the sellers don't get this house then then they won't move and will take their house off the market. Fair enough, it is a free market and whilst we are still looking round, we are under no pressure to move and can wait.

Now comes the conundrum - as every one who takes even the merest passing interest in the economy will know house prices are now under pressure with lost of talk of house prices falling. Now, we are moving up to a house which is valued at 30% more than ours. So, if there is a house price correction the the difference in prices moves in our favour, great. But what if someone else offers before we are ready to offer? We aren't in a chain as we don't need to sell first so its no problem to us when we offer but how long should we wait? If we wait too long the house the sellers are looking to buy may sold to someone else?

However, if we do offer early we may be buying an asset that is losing value, but over the long term house values rise over the longer term, but what is the longer term? But as we may be happy to live there in to our old age it shouldn't matter really as it is probably only our son who loses out in his inheritance, or is it? Whilst we have saved in pension funds if we live a long time we may need the capital for health care or even to move in to sheltered accommodation?

How I hate growing old and having to face what were once hypothetical questions in the cold light of reality.

Looks like I need to dig out a few books on game theory.

No comments: