Is it the right time to buy??

lush_walrus

lynzpower wrote:

Heres the maths bit

Rent 400
Interest only mortgage 350
life assurances, buldings insurances 60

TOTAL 810

Rent one bed flat 400.

Interest only mortgages dont get you anywhere fast do they?

Lynpower, if you have an interest only mortgage you do not pay rent too, you just pay the interest on your loan. But where possible its best to get a repayment mortgage rather than interest only.

Personally, I agree with some of the others you are ultimately better off buying than renting.

Ok just read the extra bit, but who was suggesting shared ownership, there are many ways to buy a property other than shared ownership.

missk_ensington

Yeah, it may be cheaper for the time being, but its a long-term thing. You surely can't rent forever?? And you can't get a mortgage past 45, or at least not without difficulty. The idea is that by the time you retire you're mortgage is paid off and you can start enjoying life in your old age. If I was still renting at Retirement age i'd feel a complete failure and think 'God Ive been on this earth 60 and what have I achieved?! I'm in a rented flat, no assets, no money, what a waste of 60 years'.

Then how do you pay your rent from your pension????

missk_ensington

And where on earth do you live for repayments to be £800 a month??? I calculate a borrowing of £110,000 repays at £433 a month at 4.75% on a 30yr term, if you only need 1 bed you can surely borrow less than that.

lynzpower

East London

And theres no chance Id ever go for a 30 year term!!!!

lynzpower

Dont worry I know what Im doing

Anyway OP, I think this conversation shows, each to their own

missk_ensington

So how you gonna pay your rent when you're on a pension??? Surely by then (I dont know how old you are but say you're 35) in 25 years or so rent will be innexcess of £500 a month, and the current state of pensions you'll probably only get paid £800 a month, leaving you £200 to live off.

No thanks, I though retirement was about being comfortable, not scrimping and saving in the same way you did at 18!

sportbeth

I hesitated to buy every year for the past 4 years. When I think of how much equity I would have now and how much less the mortgage payments would have been if I had bought sooner I kick myself.

I know house prices are going up and people rumour a crash, but 4 years ago I thought the market inflation was ridiculous and it wouldn't last. It did.

I rented at a good rate and was very happy in my flat. But at the end of 6 years I haven't put away any serious savings and I have come out of it with relatively nothing. With the house we're now buying at least in ten years we should have a bit more equity (not much to brag about on paper but it means you can keep up with the market that much better!) and a bit paid off the huge mortgage of £300,000 we are taking out now.

I'd say if you can, just buy

lynzpower

I will have my work pension, maybe a state pension and other investments I expect. PLus Im likely to inherit my paretns house and possibly the inlaws house, so im not too stressed. i never said I would rent forever. but you said "you are never better renting" of which I replied, tripe, as I have shown yes in fact you are better off renting IN SOME CASES

Incidentally if you rent from a housing association or from the council, its the most secure tenancy you'll ever have, no one can take it away from you unless you make poor choices about your own behaviour whilst resident in the property.

Gorgeous_George

My BTL

Rent £80 pw = £4160

If my tenants bought from me at £90k

Interest at 4.5% = £4050 (mortgages are much higher than 4.5%)

Building Insurance = £150

I also spend an average of £300 per year on maintenance for the property.

Now if they move (to a house over £120K)

EA = £1900
Stamp Duty = £1200
Solicitor = £1200
Moving fees = £300 (van etc)


These figures are made up but weighted to try and disprove my point.

Moving could cost more than a year's rent so, if you expect to move every 4 years, you could rent for less than £18k or buy and spend almost £21k before you start decorating the new house to your taste etc.

You need to do the sums (if its the money that drives you). I love owning my own home and being responsible for it. There are many others who would be better off renting. Now, what happened to all the council houses that thye majority of my generation were brought up in?

GG

missk_ensington

Well if the only way I could get on the property ladder is by living in a council house, or waiting for me mother to snuff it Id be pretty peeved!