We’d like to remind Forumites to please avoid political debate on the Forum.
This is to keep it a safe and useful space for MoneySaving discussions. Threads that are – or become – political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.
PLEASE READ BEFORE POSTING: Hello Forumites! In order to help keep the Forum a useful, safe and friendly place for our users, discussions around non-MoneySaving matters are not permitted per the Forum rules. While we understand that mentioning house prices may sometimes be relevant to a user's specific MoneySaving situation, we ask that you please avoid veering into broad, general debates about the market, the economy and politics, as these can unfortunately lead to abusive or hateful behaviour. Threads that are found to have derailed into wider discussions may be removed. Users who repeatedly disregard this may have their Forum account banned. Please also avoid posting personally identifiable information, including links to your own online property listing which may reveal your address. Thank you for your understanding.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!
Buy / Wait? Mortgage / Cash?
spuggie
Posts: 3 Newbie
Hi,
Our situation is slightly complicated. Myself and partner are freelance, occasionally working from home and were employed up until Xmas when things slowed down. We are not looking to make much this year if anything. However after a house sale in July in Manchester, we banked £240,000. Obviously it's earning little in interest at the moment. We are currently renting quite cheaply in Sweden (£600.00pm) although this will start to eat into the capitol fairly soon. We are looking to move to a 2 bed apartment in SE London and were hoping to find something without having to take a mortgage, but this does not seem easy even in the current climate due to our budget and requirements (2 double beds, off-road parking, pet friendly, vict conv). Whether we take a mortgage or not we will be renting 1 room for convenience which should bring in £500 - £600pm wherever we buy which could cover a mortgage although income is obv of importance. We won't be looking to sell in the near future and are happy to wait until the market rises, so we feel under pressure to make the right decision bearing in mind it will also be our base.
My questions are mostly about perceived risk I guess:
1. Given the climate, should we wait to buy until the market looks like it's bottoming out, bearing in mind we are not in a rush?
2. Are we likely to get a mortgage based on the capitol (but not income!) and if so, what would be a suitable one to look at bearing in mind the cash lump sum (offset, tracker etc). Also, any ideas on the average interest rate we would prob find given our circumstances?
3. Are we better off trying to stay mortgage free and get something in a lesser area within budget (but with little in the bank, say £15000) and take the income from the rental bearing in mind tax, or risk taking a small mortgage (£50 - 75,000) which will enable us to buy in a better area and keep £30000 in the bank, bearing in mind we have no idea how earnings are going to be over this year?
4. Without a mortgage are there any ways of offsetting the excess rental income to reduce tax? I believe one is allowed up to £4500.00 per year for a rent-a-room before tax is payable?
Any advice greatly appreciated.
Our situation is slightly complicated. Myself and partner are freelance, occasionally working from home and were employed up until Xmas when things slowed down. We are not looking to make much this year if anything. However after a house sale in July in Manchester, we banked £240,000. Obviously it's earning little in interest at the moment. We are currently renting quite cheaply in Sweden (£600.00pm) although this will start to eat into the capitol fairly soon. We are looking to move to a 2 bed apartment in SE London and were hoping to find something without having to take a mortgage, but this does not seem easy even in the current climate due to our budget and requirements (2 double beds, off-road parking, pet friendly, vict conv). Whether we take a mortgage or not we will be renting 1 room for convenience which should bring in £500 - £600pm wherever we buy which could cover a mortgage although income is obv of importance. We won't be looking to sell in the near future and are happy to wait until the market rises, so we feel under pressure to make the right decision bearing in mind it will also be our base.
My questions are mostly about perceived risk I guess:
1. Given the climate, should we wait to buy until the market looks like it's bottoming out, bearing in mind we are not in a rush?
2. Are we likely to get a mortgage based on the capitol (but not income!) and if so, what would be a suitable one to look at bearing in mind the cash lump sum (offset, tracker etc). Also, any ideas on the average interest rate we would prob find given our circumstances?
3. Are we better off trying to stay mortgage free and get something in a lesser area within budget (but with little in the bank, say £15000) and take the income from the rental bearing in mind tax, or risk taking a small mortgage (£50 - 75,000) which will enable us to buy in a better area and keep £30000 in the bank, bearing in mind we have no idea how earnings are going to be over this year?
4. Without a mortgage are there any ways of offsetting the excess rental income to reduce tax? I believe one is allowed up to £4500.00 per year for a rent-a-room before tax is payable?
Any advice greatly appreciated.
0
Comments
-
You could buy something nice outside of london mortgage free....0
This discussion has been closed.
Confirm your email address to Create Threads and Reply
Categories
- All Categories
- 352.4K Banking & Borrowing
- 253.7K Reduce Debt & Boost Income
- 454.4K Spending & Discounts
- 245.4K Work, Benefits & Business
- 601.2K Mortgages, Homes & Bills
- 177.6K Life & Family
- 259.3K Travel & Transport
- 1.5M Hobbies & Leisure
- 16K Discuss & Feedback
- 37.7K Read-Only Boards