Is it the right time to buy??

nomoneytoday

Whether it is better to rent or buy depends on a number of factors.

Monthly rent, other costs, inflation, alternative savings, maintenance costs, appreciation costs, mortgage interest rates, property taxes all can change the decision..

It's not a black or white answer..

lynzpower

missk_ensington wrote:

Lynzpower- Why do you have to buy for 200k there must be something less than that!? I dont intend staying in my house for years on end, I intend developing and selling, developing and sellling.... and I hope to be mortgage free in under 10 years, which will be my pension.

Say you bought at 200k, when you retire it might be worth 500k, by then you might wish to live elsewhere in the country that is cheaper than London and buy for 300k, pay back the 200k you borrowed and be mortgage free. Or move house from time to time and try and make some money to pay off the mortgage.

Or, when you retire sell the house, you might ahve made 100k above what you paid, or more, repay the mortgage 200k and you can spent your later years renting with 100k in your back pocket!

Does someone else want to tell her why this argument is so fundamentally flawed, I dont really have time to rake through these arguments again.

missk_ensington

Okay, well we shall agree to disagree. Hopefully you'll still be using this site end of the year when I come to sell my house and then I can prove that my theory is useful for some people in certain circumstances. It worked for my mum, she has a law degree and has never used it cos running her properties and businesses (using buy, develop, sell) takes up too much time.

Have a good weekend everyone, I'm off home after a hard day at work.....! lol

lynzpower

I looked back at the old thread, http://forums.moneysavingexpert.com/showthread.html?t=192958

you never told us when you actually completed! I really hope it all works out for you, :beer:

F_T_Buyer

Here we go again....

At the moment you will find rents roughly the same as an interest only mortgage. The NET yield of property is 4.7% which is after voids according to ARLA. The APR on a mortgage is more than 4.7% at the moment.

Missk_ensington says it will go up in value, well maybe long term. But prices cannot get too out of line with wages, and property has become out of line over the past 5 years (mainly because of low rates). All the economic indicators point to prices falling in the medium term (stagnating at best) so buying now is not a good idea... but that doesn't mean you will never buy.

In a year, month, week you can look again whether it is a good idea to buy...

Why am I wasting my time missk_ensington? Clearly you cannot think for yourself and resort to inherited thinking.

OP, do what you like. But it doesn't make sense to buy purely on finanicals.

meanmachine_2

"It worked for my mum".

A key phrase - it worked for your mum, rather than your mum working for it. Take a number of never to be repeated economic events (a change from highly volatile rates to low, apparently stable interest rates), an above trend boom in house prices and even Laurel and Hardy couldn't fail.

Now try and repeat the trick in a low inflation environment, with stagnant wages and flat or even - in real terms - falling house prices.

You might make money. But you'll have had to work damn hard for it.

lynzpower

My parents did exactly the same thing in the 80's thats why Ive lived in so many houses. However, they backed out of the market when there wasnt decent returns to be made. On Miss Ks calucalations in the thread I posted, she might come out if she settles for 110 with about 7k. That might just cover any stamp duty & mortgage charges etc on the next place.

Not a brilliant return considering how much effort it all takes which is why Im not convinced of her arguments.

Snow_Dog

Posts like this on various forums have always amused me, you get the feeling everyone is being baited and the usual culprits emerge from the woodwork with the regularity of a pensioner after his morning porridge.

But it always biols down to the same result after 200 posts,

some say buy
some say dont

some say rent is dead money
some say STR

some are after profit
some are after a home

The same old arguments regurgitated once again, ultimately it all depends on your personal circumstance, how much of a gambler you are and what sort of place you want to live in.

OP - Its a good time to buy cheap CD players and t-shirts from china, apparently they are driving down inflation.

meanmachine_2

True true.

I'd rather debate the regularity - or otherwise - of a pensioner's bowels than house prices yet again. So I'll stop.

The fact is, people will listen to the arguments that suit their own opinions. You can be damn sure they'll be first on the phone when/if a correction occurs, demanding compensation and insisting "no one ever warned them".

They were warned, but they chose not to listen.

Right - as we head into what is sure to be a balmy/barmy summer, I think that's enough from me till Autumn.

I don't expect the arguments to be any different by then anyway.

Same old, same old.

missk_ensington

meanmachine- it worked for my Mum, and is still working for my Mum, although is is now digressing into commercial property, restaurants, businesses, freehold investment and sells the lease at God-knows how many thousand for 10 years, plus rent.

I won't pay stamp duty on next property as I'll ensure it's just under 120k, although I'm finding most houses on market for 120-135k advertise 'stamp duty paid' probably for that reason entirely.

Lynzpower how do I come out with 7k? Buy Its cost me, say £94k inc fee's to buy and sell again, and 6-7k spending on it, that stands me at just over 100k, the MINIMUM it will sell for is 110k, its more likely to be 115-120k, but even at 110 I get close to 10k pure profit, as well as what I've saved in only paying 380mortgage a month and not 550 a month rent. Don't think thats bad for under a years work, many people only get 10k a year as a salary before tax!

This is an issue every will have different views, and it is good that we can acknowledge others' opinions. People shouldn't get so personal.