Now cheaper to buy than rent in 4 out of 5 UK citues

nollag2006

It's cheaper to buy in four out of five British cities - even in London!

http://www.dailymail.co.uk/news/article-2003566/Finding-hard-renting-house-Its-cheaper-buy-British-cities.html?ito=feeds-newsxml

Orpheo

Really? I'd better buy two then.

abaxas

Ermm,

Obviously legal fees and stamp duty are free. Whooo! Didn't realise that.

Procrastinator333

These articles are so stupid it is untrue. Lumping all renters in to 1 basket and all buyers in to 1 basket is just idiocy. The last Zoopla survey was a crock of sh*te for the same reason.

IF (and it is a very big if) you have access to the lower rates out there, buying will of course work out cheaper. But, if you are one of the FTB out there with a minimal deposit, this article is simply wrong, chances are you end up with some extortionate interest rate and buying is unlikely to be cheaper. And these articles annoy me for not making that distinction, they scare those that can't do the math for themselves in to thinking they are making the wrong choice by building up their deposit.

Everyone should work it out for their own location, but generally, in a stagnant or gradually declining market with higher rates for high LTV, the FTB (if primary concern is financial) should save hard and wait until they have access to the better rates.

ukcarper

I’m all for buying instead of renting and believe that in the long term it is much better to buy but surely if you have an interest only mortgage you are not buying.

Ponyo

But for how long? Once you sign mortgage there is no going back. You may get a fixed rate for several years, but when the term is up I doubt it will be cheaper to pay the high interest rates then. Rents and house prices could be a lot lower as interest rates go back up.

Batchy

abaxas wrote: »

Ermm,

Obviously legal fees and stamp duty are free. Whooo! Didn't realise that.

Stamp Duty is FREE until January unless your buying 250k property for FTBers only!

Nosht

Hasn't it always been so?

N.

Blacklight

ukcarper wrote: »

I’m all for buying instead of renting and believe that in the long term it is much better to buy but surely if you have an interest only mortgage you are not buying.

If you bought 10 houses in 1975 for £100k they'd be worth £1.6m now.

I'm sure you could afford to sell one and buy the other 9 now.

chucky

BixWier wrote: »

No its usually cheaper to rent the same property than the monthly mortgage payments. These low interest rates lasting so long has pushed everything way out of wack from the normal.

The problem is even if monthly payments are cheaper than the rent on a similar property, not many can get the mortgage to begin with.

Most are forced to rent which is why rents are tempory so high.

When interest rates have to go back up there will be many more distressed sellers and house prices will come down to realistic levels. Then rents will also come down as interest rates keep going up.

Its just history repeating.

hello poshboard :wave:

still spamming the same nonsense.

nollag2006

BixWier wrote: »

No its usually cheaper to rent the same property than the monthly mortgage payments. These low interest rates lasting so long has pushed everything way out of wack from the normal.

The problem is even if monthly payments are cheaper than the rent on a similar property, not many can get the mortgage to begin with.

Most are forced to rent which is why rents are tempory so high.

When interest rates have to go back up there will be many more distressed sellers and house prices will come down to realistic levels. Then rents will also come down as interest rates keep going up.

Its just history repeating.

Fully agreee with much of your comment. Lack of available mortgage credit has forced many, who would otherwise be FTBS, into the rental market.

Once this availabilty improves, which would need to preceed any interest rate increase in order to avoid an economic shock, then pent up buying demand will be released resulting in a substantial rise in house prices.

This increased availabilty would also result in some healthy competition for mortgage products, which would mitigate much or all of any rise in the BOE base rate.

Good news all round for HPI

:T