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To Buy In London or Not to Buy in London
jcgwakefield
Posts: 26 Forumite
Okay,
I'm a single bloke, first time buyer, living and working freelance in and around London.
I have no attachments, dependents, debts and my work is all over the place, even all over the world. But I really want a home as I've been renting in London for years and finally it looks like I may just be able to scrape my way into the property market, my top budget being £325k.
Now, you don't get a lot of bang for your buck in London for £325k, and I have tried to purchase lease hold flats twice now and both sales have fallen through due to my solicitor saying the lease makes the property too much of a liability and I should not buy it.
So then I look outside of London (West, as this is more likely where I will work) and I could buy a whole house with a garden.
I do have this question going through my mind though:
You buy in London, the property goes up in value more than anywhere else, but you also have higher mortgage repayments as your paying a lot for not very much and hence save little, plus everywhere else is going up in value in your area so when you come to sell, you have to move to another area further out.
But, does it make sense to buy outside of London, get a bigger place for less repayments, it goes up in value a bit but your payments are less so you put more money away and build up your capital, plus if you get a fixer upper you can make more money on that also. And then increase your deposit fro your next property even more.
Effectively, I'm asking the question, in my position where I have complete freedom to do what I want, what would you do buy in London or not?
I'm a single bloke, first time buyer, living and working freelance in and around London.
I have no attachments, dependents, debts and my work is all over the place, even all over the world. But I really want a home as I've been renting in London for years and finally it looks like I may just be able to scrape my way into the property market, my top budget being £325k.
Now, you don't get a lot of bang for your buck in London for £325k, and I have tried to purchase lease hold flats twice now and both sales have fallen through due to my solicitor saying the lease makes the property too much of a liability and I should not buy it.
So then I look outside of London (West, as this is more likely where I will work) and I could buy a whole house with a garden.
I do have this question going through my mind though:
You buy in London, the property goes up in value more than anywhere else, but you also have higher mortgage repayments as your paying a lot for not very much and hence save little, plus everywhere else is going up in value in your area so when you come to sell, you have to move to another area further out.
But, does it make sense to buy outside of London, get a bigger place for less repayments, it goes up in value a bit but your payments are less so you put more money away and build up your capital, plus if you get a fixer upper you can make more money on that also. And then increase your deposit fro your next property even more.
Effectively, I'm asking the question, in my position where I have complete freedom to do what I want, what would you do buy in London or not?
0
Comments
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The thing is you're thinking of this as a purely financial transaction.
A lot of it is about where you actually want to live. Yes, it is a financial transaction, and those things have to be considered, but this is one of the biggest decisions you'll ever make, so it really depends on whether you want to live in London or not.
Personally, I grew up in Hackney, moved away for university and work for a while, and have moved back. I am buying in London because it's my home, I love it, and I wouldn't want to live anywhere else again.
If you don't care then personally I'd probably go for a bigger place.0 -
I completely agree. The one guiding principle I always come back to is buy a home not an asset. Although, the tricky part is that the first place you buy may not necessarily be that home and has to be a stepping stone.
I do feel like I am in a very strong position but with possibly too much choice and am really interested to know what anyone who is experienced in the property market would do in my position. At the moment I'm pretty much looking everywhere in London and until something catches my eye.0 -
Buy a 2/3 bed in London, rent out a room or two, watch as someone pays 1/3rd of your mortgage then in a few years sell for a phat profit0
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ringo_24601 wrote: »Buy a 2/3 bed in London, rent out a room or two, watch as someone pays 1/3rd of your mortgage then in a few years sell for a phat profit
I agree - if this is poss it will be a benefit all round - subject to getting the right house share person! ( a friend ideally)0 -
I had a friend who did this, saved the rent money up into a deposit for the 'next' flat. Moved out, rented 2 rooms in the old place, 1 room in the new.. saved for the next deposit.. rinse and repeat. The good thing with London is there's always people looking for flat-sharesdirectdebiter wrote: »I agree - if this is poss it will be a benefit all round - subject to getting the right house share person! ( a friend ideally)0 -
Move to Swindon and put down a bigger deposit on a small new build flat. Look for good security and low maintenance, as it doesn't sound like you'll be their much.
Pay off your mortgage ASAP.
If you like the London social life, get the train.0 -
ringo_24601 wrote: »Buy a 2/3 bed in London, rent out a room or two, watch as someone pays 1/3rd of your mortgage then in a few years sell for a phat profit
That's one option. Advantage of lodger in the house when OP is away from work.0 -
Not to mention you get introduced to a bunch of random social circles as you have different housematesCautious_Optimist wrote: »That's one option. Advantage of lodger in the house when OP is away from work.0 -
Buy a freehold with more than one bedroom. Get a lodger in and pocket £4250 per annum tax-free. Someone else to share the Council Tax and utilities. Someone there to keep an eye on the place when you're away. No service-charges as with a leasehold and you do what repairs and maintenance you consider necessary when you want to do them.0
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