MW: IS buying cheaper than renting?

geneer

geneer wrote: »

Let the adhominem frothing begin!

Ah yes. Another bear prediction comes true.

Lets face it, self aware the bulls are not.

Rinoa wrote: »

Indeed. Obviously Geneer empathises with anyone who waits years to buy and loses a fortune in the process. :rotfl:

One wonders how anyone who sold in london near peak and bought in Edinburgh post crash has lost anything.
Its a conundrum.

Of course champion flipper Columbo/Rinoa quit his property flipping in 2005.
So by the rules of his own tedious game, hes clearly lost tens of thousands of pounds by failing to cash in on the final lurch of the biggest bubble the UK housing market has yet seen.

What a silly billy.

geneer

Pimperne1 wrote: »

After 25 years

In it for the long term eh.

Of course the comparison was for 5 years.
Suggesting that there nothing to lose and quite a bit to be gained by sitting on the side lines for a bit.

heathcote123

You forgot to predict you'll still be !!!!!ing on forums in 6 years time, and that house prices would be more expensive...

geneer

heathcote123 wrote: »

You forgot to predict you'll still be !!!!!ing on forums in 6 years time, and that house prices would be more expensive...

Could be worse. I could have been on the forums 8 to 9 years ago telling everyone how bearish I was, before bottling it and buying only half a house months from peak.
Subsequent to which I could have nursed an embittered obsession with a single poster, in which I would consitently reiterate discredited assertions, knowing full well that the target of my affections cared not a jot.

Yep. Things are looking pretty good from where I'm sitting.

Pimperne1

Andy_L wrote: »

But since you need somewhere to live how much use is that £160k equity? (or if the council seize it to pay of care costs?) and how much have you spent making sure its still worth that (insurance, repairs, upkeep, re-decoration)

That's a bit of a new introduction to the debate. "Will the council seize your house to pay for your care when elderly"? First it was that "house prices are going to crash", then it was "well they went down in real terms" now its "okay, you've made out like a bandit but the council might seize your house to pay for your healthcare".

Won't they take all that money that the renters have squirrelled away to pay for their healthcare too?

Andy_L

Pimperne1 wrote: »

That's a bit of a new introduction to the debate. "Will the council seize your house to pay for your care when elderly"? First it was that "house prices are going to crash", then it was "well they went down in real terms" now its "okay, you've made out like a bandit but the council might seize your house to pay for your healthcare".

Won't they take all that money that the renters have squirrelled away to pay for their healthcare too?

I thought the debate (on this thread at least - there appears to be some history between various posters I'm both unaware of & uninterested in) was "is buying cheaper than renting". The care bills reference was a throwaway line to expand the point that equity in a house you need to live in isn't available to be spent on beer & hookers.

wotsthat

Jeez not only is it Moneyweek but Capital Economics have done the sums!

The maths rely on a couple of improbable assumptions, ignore capital paid off, and take no account of the long term financial benefits.

Plus we've had to account for our happy renter having a deposit saved up but choosing to rent and save the deposit. It's interesting from a maths point of view but hardly real world.

robmatic

wotsthat wrote: »

Jeez not only is it Moneyweek but Capital Economics have done the sums!

The maths rely on a couple of improbable assumptions, ignore capital paid off, and take no account of the long term financial benefits.

Plus we've had to account for our happy renter having a deposit saved up but choosing to rent and save the deposit. It's interesting from a maths point of view but hardly real world.

It's not clear to me why the hypothetical buyer sells up after 5 years. Where is he going to live?

And if our hypothetical renter is paying average rent, what about the 50% of renters who are paying more than average rent? Is it right to suggest that 'most' FTBers are taking a risk when the numbers will stack up in favour of buying under that analysis for half of them?

FATBALLZ

Over the long term, there will always come a point that buying works out better, but renting short term can sometimes be better. I rented from 2005 until earlier this year, and it worked out a little bit better than if I'd bought in 2005 and hadn't rented at all.

IveSeenTheLight

Andy_L wrote: »

and if we have a return to the high interest rates my parents had when I was a kid? As I said, a difficult calculation that requires a crystal ball to know the answer (much like pensions)

True, interest rates can and will no doubt rise at some point.

That said, there have already been a number of years where mortgage rates have been low and you can get a 10 year 3.99% fixed mortgage now, so security for 40% of the standard mortgage going forward.

The other thing is that economists don't seem to be predicting interest rates any time in the near future