Should I sell or can I budget?

anniestar

My DH's a teacher and a lot of the staff at school with children are registered with a home swap company. There are loads of teachers which means hollies at half term as well as the summer.(a friend of ours who we have sadly lost touch with went all over the world as well as all round the uk. It was a fantastic way of seeing tons of places on a tiny budget.

EdInvestor

Hello again whambamboo

whambamboo wrote:

I don't have a luxury lifestyle: I am fortunate enough to be earning >£10k/month, but I don't see the need to spend it on crap in general, I'm not about to take a holiday in an Aman resort at $650/night, because it's a waste of money, and you can get *very* nice hotels in these destinations for no more than $100. I'm also not going to take my family on business class flights at £2k/each....

.....I could pay a £3k/month mortgage out of my income rather than the £1.1k/month rent I pay, but I think it is risky in terms of house prices: the repayments are not the issue, the potential loss of capital value is.

You say you would like the housing market to crash so you can then use your massive salary to buy a nice house cheap, and not risk making a capital loss.

But you could buy a property now, without having to struggle in the slightest.

Do you think any normal person in your position, married with one child and a salary of more than 10k a month, would be renting?

Sorry, but I have only two words to say to you: Get real.

whambamboo

EdInvestor wrote:

Hello again whambamboo

You say you would like the housing market to crash so you can then use your massive salary to buy a nice house cheap, and not risk making a capital loss.

But you could buy a property now, without having to struggle in the slightest.

Do you think any normal person in your position, married with one child and a salary of more than 10k a month, would be renting?

Sorry, but I have only two words to say to you: Get real.

I don't understand your point.

I can rent for £1.1k/month or pay £2.3k/month in interest on debt on a mortgage on the properties I'm looking at.

Tell me why you imagine I'd want to do the second of these options? Yes, it would be nice to own a house, I'd like to be able to change the decor, redo the bathroom, plant veggies in the garden, but everything has its value, and that value is not £14k/year.

I might be rich but I'm not stupid.

You're telling me to get real, and yet I'm saving thousands of pounds a year, and am avoiding the risks associated with price falls.

Your attitude is beyond ridiculous.

Michael Ballack has moaned about property prices in the capital, despite the fact he's paid a whopping £130,000 a week by the Premiership champions.

But he's told a German newspaper that his huge income still doesn't enable him to get his dream house.

He's believed to have initially set his heart on a six-bedroom home with a pool, either in the capital or near Chelsea's training ground in Cobham, Surrey.

But after being told it would cost him a cool £4million, he settled for renting instead.

He said: "London is extremely expensive. It's better to rent. My family and I have found a house in Wimbledon."

Quite right - and he's not the only one. Why do you think they have houses for rent at £5k, £10k+/month when you claim that nobody with a high income would be stupid enough (as you see it) to rent? Shock horror news alert, not all people with money choose to sink it all into property!

I expect you would have been telling me in 2001 to buy dot com shares and to "get real" and follow everybody else into the market.

If other people are foolishly paying well over the odds for an asset, why should I follow suit?

I am not a sheep. I do not feel the need to drive a £30k car - it wouldn't enhance my life. I have scant regard for whether the neighbours think I am 'doing well'. I do not need to be impress anyone, nor follow any "property ladder" hype about having to buy a house the second you can afford it.

Neither do I think I'm a failure (as you seem to) for not owning a house. Who cares? Most Germans do not own property. When I was over there it didn't seem to bother them, in fact the quality of life over there seemed better than it is here.

Your attitude is 'you're rich, you shouldn't care about prices and valuations, just pay whatever people are asking'. Sorry, no thanks, not for me. A fool and his money are soon parted - I think I'll hold onto mine.

EdInvestor

WBB

The criteria you use are entirely appropriate when talking about investing in property.But most people do not look upon their family home as wholly an investment, and thus other considerations apply.

It's not of course also a widely held view that you will lose money by buying a home. Quite the opposite, I'd have thought.

So I'm afraid I think your position is a bit divorced from the reality out there, much as it may work for you.

whambamboo

EdInvestor wrote:

WBB

The criteria you use are entirely appropriate when talking about investing in property.But most people do not look upon their family home as wholly an investment, and thus other considerations apply.

It's not of course also a widely held view that you will lose money by buying a home. Quite the opposite, I'd have thought.

So I'm afraid I think your position is a bit divorced from the reality out there, much as it may work for you.

I'm sorry, neither you nor I know what is going to happen to property prices.

So any price drop/fall is pure speculation on either side - although we'll both argue that house prices will rise/fall based on various data.

So disregarding that you examine the cost of ownership and benefits it gives. In my case I would be looking at > £10k/year to move.

That's not worth it for the benefits it gives to me.

densol_2

I am with the OP on this one.

I think the trouble with means is - we live to them !!

However much I earn I just always seem to want more. Since I have split with my ex and am now with a more stable partner we do budget carefully - we also try to save !

However answering the OP's problem, I would not reduce your house just to pay for frivolous expenses- there would seem no point. Mortgage for the best house you can afford and then cut your cloth according to what you have left.