Take cover! The housing market is heading for a bloody and protracted crash!

Graham_Devon

The mortgage is likely to be 6% from the start, let alone only ever reaching that.

Plus legal fee's. Plus stamp duty. Plus never moving.

Can we quit this argument? Who really rents for 25 years solid in the same house? How many buy one house and live it in solid for 25 years?

The very miniority. Therefore all these arguments are just !!!!!!.

People are far more likely to do up a house and spend money on it and then move, starting the same process again.

HAMISH_MCTAVISH

Graham_Devon wrote: »

Can we quit this argument? .

Simple question.

Do you really think the average person who rents for 25 years will be able to do so more cheaply than the average person who takes an I/O mortgage on a comparable property for 25 years?

Yes or no.

Graham_Devon

HAMISH_MCTAVISH wrote: »

Simple question.

Do you really think the average person who rents for 25 years will be able to do so more cheaply than the average person who takes an I/O mortgage on a comparable property for 25 years?

Yes or no.

No.

But equally I don't think the average person who could have otherwise bought will rent for 25 years.

Therefore it's all a load of nonsense you use to try and prove some silly little point which actually doesn't reflect even the tiniest percentage of the population yet are determined to win this argument based on the lowest common denomiator.

You normally rent because:
A) you cannot afford to buy so the claculations mean nothing
you don't want to buy due to not wanting to commit to a location so the calculations mean nothing

All these claculations you are sat there doing completely and utterly miss these points, which most normal people completely and utterly understand.

I can't spell claculations. Oh darn it.

HAMISH_MCTAVISH

Graham_Devon wrote: »

No.

Oh good.

So we've established that someone on a 25 year interest only mortgage is better off than someone renting the same property for the same time.

Which should put to bed all this anti I/O hysteria.

Because even if you can't afford a repayment mortgage, then taking an interest only mortgage is still a better financial decision than renting. Which is the only other option.

You normally rent because:
A) you cannot afford to buy so the claculations mean nothing
you don't want to buy due to not wanting to commit to a location so the calculations mean nothing

You missed a couple....

C) you read a website saying house prices are too expensive and will crash. Yet 10 years later they're still massively higher than when you joined.

or nowadays....

D) you can't get a mortgage from the bank, so are forced to rent more expensively than buying, while rising rents mean you may take up to 20 years to save the absurdly large deposit required.

Graham_Devon

HAMISH_MCTAVISH wrote: »

Oh good.

So we've established that someone on a 25 year interest only mortgage is better off than someone renting the same property for the same time.

Which should put to bed all this anti I/O hysteria.

Because even if you can't afford a repayment mortgage, then taking an interest only mortgage is still a better financial decision than renting. Which is the only other option.




You missed a couple....

C) you read a website saying house prices are too expensive and will crash. Yet 10 years later they're still massively higher than when you joined.

or nowadays....

D) you can't get a mortgage from the bank, so are forced to rent more expensively than buying, while rising rents mean you may take up to 20 years to save the absurdly large deposit required.

I do admire how you simply edit out anything that doesn't suit hamish!

ukcarper

HAMISH_MCTAVISH wrote: »

Oh good.

So we've established that someone on a 25 year interest only mortgage is better off than someone renting the same property for the same time.

Which should put to bed all this anti I/O hysteria.

Because even if you can't afford a repayment mortgage, then taking an interest only mortgage is still a better financial decision than renting. Which is the only other option.

.

That’s the point I was trying to make not that I would advise any body to do it and contrary to what Graham thinks a lot of people live in houses for 25 years or more I have as have most of my friends.

I don’t think I have spent £40k on my house in the 25 years I’ve lived there and I have had double glassing, 2 new kitchens, new bathroom, boiler and guttering. Mind you I have done the work myself with the exception of the double glassing, boiler and guttering

Bigdeflationfirst

Graham_Devon wrote: »

I do admire how you simply edit out anything that doesn't suit hamish!

Classic Hamish, just turn a blind eye to anything you don't like, then everything is rosy Trouble is this is why he is nearly always wrong.

Bigdeflationfirst

HAMISH_MCTAVISH wrote: »

So we've established that someone on a 25 year interest only mortgage is better off than someone renting the same property for the same time.

Which should put to bed all this anti I/O hysteria.

Because even if you can't afford a repayment mortgage, then taking an interest only mortgage is still a better financial decision than renting. Which is the only other option.

Not true at all. Interest only means you are just renting off the bank, but the kicker is - you are responsible to maintain the property and furniture not the bank.

If you are renting the same property for the same price if the fridge or washing machine breaks you just call the landlord its his problem. You also do not have to worry about being negative equity as this property bear market continues down, down and down.

You also do not have to worry about mortgage costs only going one way in the future, up up and up.

If you are renting off a landlord rather than the bank (interest only mortgage) then you will be happy next year when the the 480 benefit cap comes in and average rents fall in line with the cap.

ukcarper

Graham_Devon wrote: »

No.

But equally I don't think the average person who could have otherwise bought will rent for 25 years.

Therefore it's all a load of nonsense you use to try and prove some silly little point which actually doesn't reflect even the tiniest percentage of the population yet are determined to win this argument based on the lowest common denomiator.

You normally rent because:
A) you cannot afford to buy so the claculations mean nothing
you don't want to buy due to not wanting to commit to a location so the calculations mean nothing

All these claculations you are sat there doing completely and utterly miss these points, which most normal people completely and utterly understand.

I can't spell claculations. Oh darn it.

Of coarse your points are correct if you can’t or don’t want to buy you won’t make the savings.

DpchMd

Bigdeflationfirst wrote: »

Not true at all. Interest only means you are just renting off the bank, but the kicker is - you are responsible to maintain the property and furniture not the bank.

If you are renting the same property for the same price if the fridge or washing machine breaks you just call the landlord its his problem. You also do not have to worry about being negative equity as this property bear market continues down, down and down.

You also do not have to worry about mortgage costs only going one way in the future, up up and up.

If you are renting off a landlord rather than the bank (interest only mortgage) then you will be happy next year when the the 480 benefit cap comes in and average rents fall in line with the cap.

You completely forgot about equity, which has been mentioned several times throughout this thread.

A £200k house today could conceivably be worth over £400k in 25 years time. The interest-only buyer gets to sell the house for a tidy profit. The renter gets nothing but an argument with the Landlord over deposit deductions.

Even if the house increased by an average of 1% a year over 25 years, the buyer is still likely to be financially better off than the renter.