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Debate House Prices
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Rent is the real Financial Millstone.....
Comments
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I agree with all you said.
No complaints here.
However, the only hope is the value of the house has decreased sufficiently for the renter, so he can buy and mortgage at the 192k level in two years for 23 years. I see its all down to opinion here, and I have no idea where its all going, but i do feel there is a round two of pent up demand of potential FTBs who think its now or never, 2011 could well be a turning point where they all do something to make it happen.
The potential ftb doesn't need house price falls if their rent is £983. 24X(1289-983)= £7,340. When the renter buys after 2 years they have the exact same equity as the person who bought on day 1.
It is because of this that the capital element should be ignored when comparing. It is the interest cost vs the rent cost that is important. The capital element can be saved equally on both sides if rent cost = interest costs. Hence why the interest cost vs rent cost is so important. If prices are flat, the renter will have more equity if rent < mortgage interest cost and vice versa.
I agree there are many who want to buy, but at the moment, the RICS report shows vendors are desserting the market at a faster rate than potential buyers. So for the moment I will keep saving and waiting!0 -
noone is stupid enough to suggest renting over your entire lifetime, they are saying you shouldnt buy at the height of a bull marketFaith, hope, charity, these three; but the greatest of these is charity.0
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what happens if you buy getting a cheap tracker mortgage is it cheaper or more expensive?
i didn't buy in 2007 btw...
Thats the point, it is comparing the mortgage available in 2007 with what is available now or in the future.
With the general feeling that interest rates will stay lowish for a long time, even good trackers available now are priced at BOE base + 2-3% whereas you could get BOE base + 0.5% lifetime trackers a few years ago.I'm a Forum Ambassador on the housing, mortgages & student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.0
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