Camped out on the pavement outside a dilapidated Victorian terrace, two terrified cats sit caged in puddles of their own vomit, howling to go home.
What they don’t know is that this house is now theirs, or at least it will be when the previous owners move out.
We had been the legal owners of this house for five hours, and yet here we were, abandoned on the street, surrounded by all our worldly possessions, while the vendors endlessly busied themselves cleaning up 20-year-old junk.
As our stress levels skyrocketed, we momentarily feared that we had made the biggest mistake of our lives. Our new home, worth several times our annual income, was covered in disgusting gray dust, had two bathrooms that were deemed “not fit for purpose,” and came with a pregnant squirrel occupying the ceiling cavity.
But as the weeks went by we felt proud that we were building something that we had once considered beyond our reach: a stable family base. This house, though hardly a palace, belonged to us.
Kind of. With a monster mortgage and us agreeing to modest initial capital to free up cash for a much-needed renovation, most of the bricks in these walls still technically belonged to our mortgage lender.
We accept this as par for the course. Property prices had skyrocketed at dizzying heights in our area, so it was either this or accept that a family home was out of reach.
As we slowly settled in, our heads spinning with excitement at our renovation plans, we felt we had made the right decision.
But we soon calmed down when, in September, the markets went wild and pundits began predicting a house price crash of up to 30%. Suddenly, the era of cheap mortgages was over and, if history is any guide, lower property valuations were sure to follow.
If this occurs, we face real negative equity risk, as we may have bought the top of the market in July with a high loan value mortgage.
The moment felt like a cruel twist of fate. My husband and I come from a generation for which housing has been much more expensive than for older age groups because property prices rise faster than wages.
Much of my twenties was spent writing in national newspapers about how difficult it was for the “Generación Renta”. One column, written in 2014, even declared that this was the “worst time to be young in history.”
Back then, we didn’t know that prices still had to go up 50 more pieces, and that’s good work, too, or we might have choked on our avocado toast.
But with a little grafting and saving, everything seemed to have worked out in the end, or so we thought, until the infamous mini-budget a few weeks ago.
Without warning, it seems, we’ve been thrust into a world where the only thing scarier than not owning a home might be owning one.
And the question arises: if the market is about to crash, was buying the family home we worked so hard for the biggest mistake of our lives after all?
I sought some reassurance from some people in the know. In short, the collective response from him was that people like us who bought this year will probably be fine, but of course none of the experts can say that with confidence.
One of the biggest considerations, they said, was how long recent buyers intend to stay in the home. The answer for us is ten years or more, possibly indefinitely. This, I am told, is cause for optimism.
It took the market seven years to recover after the 2008 crash, so as long as we remain in a position to pay mortgage bills, we could ride out a temporary drop in house prices before the market (hopefully) recovers.
We’re also thanking our lucky stars for spotting a five-year fixed mortgage just before rates really skyrocketed. But with a relatively high loan-to-value mortgage in our name, the repayments are significant and could become dazzling if interest rates soar even higher by the time we remortgage. Nobody knows how high they could climb.
The worst case scenario would be a fire sale after five years if we can no longer pay the bills. This prospect is frightening and questions whether it is wise to go forward with our renovation.
The way things are going, our next fixed mortgage deal may be much more expensive than our current one, so should we use our renewal pot to pay off a portion of the mortgage instead?
It could be argued that this would be sensible, as we could save a lot on borrowing costs later on and protect ourselves from a catastrophe.
But there are arguably more compelling arguments for going ahead with the work. As one bullish insider noted, the cost of renovation could also rise, pushing more spending into the future, just in a different way. Renovating later would also be a worse investment from a quality of life perspective.
The house is in disrepair and you will feel increasingly uncomfortable to live in it for the long term. The money spent on the renovation will now mean more good years living in the house, which was the main purpose of buying it in the first place.
Also, if we renovate now we should increase the value of the house, offering some protection against market declines. We would increase our loan-to-value ratio and reduce the possibility of negative equity.
Ultimately, it should improve our position the next time we re-mortgage.
In addition to industry insiders, it’s also been interesting to talk to older homeowners who have weathered past home price declines. A recent tweet about my possibly ill-timed purchase drew replies containing advice from some.
One, who bought his first flat in 1989 a month after the market started to fall, said that meant other buyers could snap up similar properties for 30% less. “Devastating at the time,” he said, “but time is a great healer.” Another opined that everything would be fine as long as our mortgage had less than a 60% loan-to-value ratio (if only!).
A third said that if all else failed, putting a red light in the front window could help pay the bills. Forbidden sky.
The real estate market is usually brutally unfair, but none of us can beat it, so we join it and accept our fate. It’s tempting to compare ourselves to those who “came in at a good time”, but doing so will drive us crazy. It also works the other way.
Just as many of you reading this would not want to be in my shoes having bought into what could become the top of the market, others about to be hit by 6pc mortgages, or unable to climb the ladder at all , they may wish they could swap places. So, did I just buy at the worst time in history?
All we can do is watch and wait. But for now, our plan is this: continue with the renovations, avoid comparison to others, be grateful for what we have, and pray that we can still pay the mortgage in 2027.