Is Renting Really Dead Money?

kenshaz

The problem is when retirement arrives and your income is less ,and your friends have paid off their 25yrs mortgage and you are still forking out for rent.Also nothing to leave to your kid's,unless you wish to adopt the philosophy of spending your children's inheritance

kenshaz

westernpromise wrote:

That's one way of thinking about it. Another is that it was the single biggest redistribution of wealth toward the poor there has ever been, and that it set council tenants free from dependence on the state. Free to move elsewhere if they chose to; free to build up something to pass on to their children; free to build up something for their own retirement.

Of course, current thinking is more along the lines of "Keep them on benefits so they'll keep on voting for the party that pays the biggest, easiest benefits".

That's democracy,we vote them in and they make the legislation ,if we are not happy then we vote them out good isn't

Sisyphus

Gorgeous_George wrote:

Yes, what I was trying to say is that, on an estate where all or most houses are rented, you tend to find more problem families than on estates that are all private. I'm sure there are exceptions to this rule.



GG

have to disagree, I can afford to rent in a nicer area than I could afford to buy in. In fact as a tenant I was able to move there quickly to benefit from a good school catchment area.
Wait a minute, maybe it's me who's bringing down the neighbourhood.

liz545

kenshaz wrote:

The problem is when retirement arrives and your income is less ,and your friends have paid off their 25yrs mortgage and you are still forking out for rent.Also nothing to leave to your kid's,unless you wish to adopt the philosophy of spending your children's inheritance

While it's true that many parents want to leave their children an inheritence, it doesn't follow that every child is due an inheritance. The phrase 'spending your children's inheritance' implies that it's their money, not yours, to spend! My parents live in tied accomodation, and when they retire will probably have to find rented or sheltered accomodation. So there probably will be very little in the way of an inheritence for myself and my sister. While I'd love to get a £20k deposit from them to buy my first home, it isn't going to happen, and I know that buying my first home will only happen if I work hard to make it happen. In a way, nothing has changed in that the property owning classes ensure that this wealth is passed through the generations; while RTB has democratised this a bit it's brought a raft of attendent problems with it.
And anyway, who wants to leave their home to their children in the knowledge that 40% of it may well end up being lost to inheritence tax?:D

kenshaz

They are excellent reasons,perhaps quality of life and your children's education is important ,plus and minus,depends what you want as an individual,chose

mi-key

I dont agree with the point that people renting can never save for a deposit - as rents are MUCH cheaper than mortgage payments in a lot of places, whats better :

1) Rent for a few years, putting aside a little each month until you can save enough for a deposit.

2) Hugely overstretch yourselves now on a 100% mortgage for an overpriced poky flat, then in two years when your 'introductory rate' runs out, end up with the payments going even higher, and find that you cant afford them, and your flat is worth no more than you paid for it.

You also have to bear in mind most rents only go up in line with inflation ( some dont go up at all if the market is saturated - ours didnt for a few years ). In a lot of jobs, you will be earning a lot more in 5 years time say, and thats when you can start seriously saving for deposits.

I've rented since I left home at 16, now I'm buying somewhere, and while renting saved over £20,000 in ONE YEAR which is paying for all the moving costs, 5% deposit, stamp duty and furniture etc....

Over the years I have paid a lot in rent, but whats the alternative ? live in a cardboard box for free ? I've never resented paying rent to live in a decent home in a nice area.

Theres no way I would have been able to get a mortgage with previous salaries I've had, or while I was at University for 4 years, or while I've been building up my business and had low income. Now I can, and can afford to do it comfortably without stretching - and because my rent has been low for the past few years as my wages grew, I have no debts.

kenshaz

liz545 wrote:

While it's true that many parents want to leave their children an inheritence, it doesn't follow that every child is due an inheritance. The phrase 'spending your children's inheritance' implies that it's their money, not yours, to spend! My parents live in tied accomodation, and when they retire will probably have to find rented or sheltered accomodation. So there probably will be very little in the way of an inheritence for myself and my sister. While I'd love to get a £20k deposit from them to buy my first home, it isn't going to happen, and I know that buying my first home will only happen if I work hard to make it happen. In a way, nothing has changed in that the property owning classes ensure that this wealth is passed through the generations; while RTB has democratised this a bit it's brought a raft of attendent problems with it.
And anyway, who wants to leave their home to their children in the knowledge that 40% of it may well end up being lost to inheritence tax?:D

Exactly ,it tastes sweeter when you have achieved it,I often think that about winning the lottery,I am happy with the world that I have created,perhaps unearned money is less satisfying.

linda.b_4

A few people have mentioned the fact that when they've paid off the mortgage there will be money to leave to the kids. What if the government make us sell our property to pay for the care home fees we might need? Then the renters will be happy they paid less rent than mortgage but get free health care while homeowners have to sell up and use their equity!

CB1979_2

linda.b wrote:

A few people have mentioned the fact that when they've paid off the mortgage there will be money to leave to the kids. What if the government make us sell our property to pay for the care home fees we might need? Then the renters will be happy they paid less rent than mortgage but get free health care while homeowners have to sell up and use their equity!

too true!

but alas another IF, what IF the govt decide in fact to not provide housing unless you have been paying off a property of your own?

unlikely I know but still an "IF"

TJ27

I visit rented accommodation every day as part of my job. I'm aware that a small two bedroomed flat in a fairly ropey part of the city costs as much in rent as my mortgage does. I'm fortunate enough to live in a very nice part of the city, with superb schools and amenties, and have a nice four bed house with a large garden.

Of course the only reason I can say this is because I bought about nine years ago, when house prices were cheaper. But bloody hell, I'm glad I did!! I guess it will be a different story over the next nine years though, so renting might work out the best option. You never can tell.

The mortgage stretched us at the time we took it out. Now it's peanuts.

However, as a home owner I can be pretty sure that my family will always have a roof over their heads, whatever happens (almost!). That's worth a lot.