Has STRing paid off for anyone?

Pobby

I think for some that released say a 6 figure sum in equity, the game plan was to use the interest from the str pot and have that cover the rent.

Now I advised, about 4 years ago, that my nephew go for fixed rate.I really thought that IRs were on the way up. I had no idea that we could end up with 0.5%. That has thrown a lot of people including myself with savings.

Of course, 0.5% won`t be around forever. It`s a sticking plaster over a wound and is there so a lot of indebted people won`t go under. It also gives the lenders a grand chance to rapidly recapitalise.

wolvoman

It's all swings and roundabouts though.

I bought at the peak in Sep 2007 and yes my place has lost money. But I'm on a tracker and my mortgage interest is £150 a month. Try renting a 3-bed luxury flat in zone-3 London for that amount!

And then also before I bought I held £40k of my deposit in RBS shares. Had I not bought I would likely have kept the shares and lost nearly all that money.

Swings and roundabouts.

zappahey

Harry_Powell wrote: »

STRing has worked really well for people like yourself who sold on the very month that the peak was reached. I wonder how much people will have gained, if anything if they sold 6 to 12 months (or more) either side of Sep 2007.

Well, we STR in support of a job relocation, so it doesn't really count for your purposes, but our situation might answer your question.

We bought in May 2006 for £208k and sold in June 2008 for £220k (we might have squeezed a few £k more out of it, but getting rid was more important than maximising the price).

Our neighbours bought a similar house to ours at the same time as us(in a slightly better position) for £219k, and they have just sold for £210k.

Assuming that our house is now worth proportionally the same, then it would sell today for around £199.5k so the "gross profit" would be in the region of £20k.

JanCee

Harry_Powell wrote: »

I removed the "shame we're not getting many responses..." comment because we did start getting some posts, but it seems that many people who are labelled as STR'ers are actually just people who are downsizing to more manageable homes, relocating or both.

Perhaps someone with a logon to the HPC forum could post the question there and link to it here (I can't rememebr my password anymore on there and can't be bothered re-registering). I am interested in the sort of savings people have made using this tactic and there may be a better response on HPC?

I STR'd in 2007, at the peak of the market as it happens, but this was more luck than good judgement. The idea was to rent for up to 2 years to see how the market went. We were looking to move to a much more expensive area. In the end we bought again after 6 months, didn't really like being a tenant. We never did get to the more expensive area but we did manage to upsize and save about £30k in the process. At the time interest rates were good and we had a lot of equity from the old house so the cost of renting was more than covered.

So it all worked out quite well for us, but it is a real gamble and I personally wouldn't have risked it if we hadn't had backup savings.

Shortly after all this excitement my OH almost lost his life. Believe me there are far more important things to worry about than house prices.

Cannon_Fodder

Harry_Powell wrote: »

They also forget that they had expenses when they originally bought their house (stamp duty, solicitors fees, searches, etc) then more costs when they sold their house to rent (solicitors fees, estate agent fees, removal costs, perhaps mortgage redemption fees, etc.) and will then have more fees to pay when they buy the new house (stamp duty, etc. etc.).

Every house-mover has those costs. Selling and buying in one transaction has those costs, and STR has those costs.

There will be extra moving costs due to STRing, maybe your solicitor will do a slightly cheaper deal for "two in one", rather than two seperate transactions.

But for those who deliberately aimed to "beat the market", they always knew they would incur another set of purchase costs, they simply deferred "a given".

Harry_Powell wrote: »

They also have to factor in how much they pay in rent while they're out of their house

Fair enough.


£10k-£12k purchase costs on a £240k house?...that's very high, even forgetting the above.

boyse7en

Cannon_Fodder wrote: »

Every house-mover has those costs. Selling and buying in one transaction has those costs, and STR has those costs.

There will be extra moving costs due to STRing, maybe your solicitor will do a slightly cheaper deal for "two in one", rather than two seperate transactions.

But for those who deliberately aimed to "beat the market", they always knew they would incur another set of purchase costs, they simply deferred "a given".

But the comparison is between those who STR and those who stay put. The idea is to end up in the same (or equivalent house) but to have less money on the mortgage / more money in the bank.

Therefore the STR has one set of selling costs, and one set of buying costs, to take off of any gross profit showing when they buy back into the housing market. The SITH (stayed in their house-r's) don't have those costs.

Harry_Powell

Cannon_Fodder wrote: »

£10k-£12k purchase costs on a £240k house?...that's very high, even forgetting the above.

Yes, sorry I got muddled with stamp duty thresholds.

mewbie_2

Has STRing paid off for anyone?
Oh yes. Logged into HPC early 2006 and got informed. Sold entire portfolio between August 2006 to December 2006. Stayed clear of Icelandic banks. Put most of portfolio into shares, again thanks to HPC, towards the end of last year.

My accountant reckons I have made something approaching two million just by these astute moves.

I wrote a personal thankyou letter to "Financial Planner".

nearlynew

mewbie wrote: »

Has STRing paid off for anyone?
Oh yes. Logged into HPC early 2006 and got informed. Sold entire portfolio between August 2006 to December 2006. Stayed clear of Icelandic banks. Put most of portfolio into shares, again thanks to HPC, towards the end of last year.

My accountant reckons I have made something approaching two million just by these astute moves.

I wrote a personal thankyou letter to "Financial Planner".

I know you are lying because.........................





..........................you didn't mention buying gold.

mewbie_2

nearlynew wrote: »

I know you are lying because.........................

..........................you didn't mention buying gold.

I didn't mention gold because I had a couple of k's at one point and I don't want some idiot digging up the back garden again looking for it.