Should I sell and rent?

scoobiesnacks

There's nothing reasonable about rental or buying prices here! The market has been transformed by transport links to canary wharf in recent years. All the offers I had on my house where from bankers! The offer I accepted was 41k over asking price. So it's a bit bonkers here.

we've had warnings from Mr King before that don't seem to have made any difference or materialised.

Of course if prices do soften, I'm laughing.

Hmm, heads or tails.

Tassotti

You've made a good profit... Pick a new hotspot and do the same again.

lynzpower

scoobiesnacks wrote:

I'm beginning to think that selling to rent is a gamble I'm not prepared to take. There are houses coming on the market round here, Greenwich, which are very oridinary and each one that comes on is 20 - 30k more than the last, and they're regularly going to sealed bids.

An estate agent told me not to worry about losing my buyer as there's so little on the market and that even if I did there would be more buyers queueing up.

The downside is I'm not optimistic about finding what I want quickly. Catch 22.:rolleyes:

Buying in London sucks!

I agree with you

The things that are driving our move, when it happens
1. Its shared ownership, not VFM etc
2. we cant have pets here & OH has a dog that is with his folks for now
3. we would like a very specific type of property in a small area, that we wont get in the selling process, & we will not want to lose buyers by us being unreasonable etc
4.financially it looks like a good move. It might not be "better" than what weve got now, but its certainly not worse.
thats how I justify it anyway.

I just dont want to move really, I cant be bothered.

itsakidsworld

If you need some cash why dont you release some equity from your existing property and pay the amount borrowed on interest only?

If you released say £100,000 then the interest at 6% would be £6000 a year or £500 per month. It would be like renting from the bank but you actually own the property so any increase would be to your benefit.

Of course prices could come down but if you took out an interest only over say 15 or 20 years then without a doubt, within this time you would have a least one big price increase.

Never jump of the property ladder unless you are leaving the Country or it is a last resort for personal reasons. It is hard climbing onto the thing but so very easy climbing off!!!!

lynzpower

IAKW

Was that last comment for me or Scoobiesnacks?

IM guessing you are talking about SS??

itsakidsworld

You can both have it as a freebie from me!!!!!!!:)

lynzpower

well im already on IO so it wont work for me

next step is being mortgage free ( in the new place, impossible in SO)

itsakidsworld

It depends how much you already owe on IO. If it is under £100,000 then it could be worth releasing equity. If its over then it needs serious thought.

You say you want to be mortgage free which is great but to sell and rent is worse than being mortgage free.

What are costs of renting in your region? £500, £600, £800 per month?

For every £100,000 you borrow in Interest Only the repayments are per month as follows at various rates;-

5% = £417

6% = £500

7% = £583

8% = £667


So even if rates went to a crazy high, it would still be of more benefit to use the equity in the house and technically "self rent" for say 10, 15 or even 20 years.

I fully understand that some people prefer to rent and then forget about having any responsibility with owning a house which is fine. However, if you want to have a chance of some kind of pension in years to come, the property investment method is about as safe as you can get.

Nothing in life is guaranteed, but by playing the law of averages gives you a better chance in life.

lynzpower

this is impossible in Shared ownership as the "equity" is assessed by the housing association and not the bank.