House purchase dilemma

adonis10

boliston wrote: »

I would not be so keen on jointly investing with a partner as if you split up it could get complex legally. I would let out my existing flat via an agency and use the income to jointly rent another flat. That way you keep flexibility if your circumstances change.

We'd make sure there was something very clear and legal in place before hand to eliminate any issues further down the line.

I take that point, but I'm not interested in paying someone else's mortgage. Not a fan of mortgages at the best of time so will only ever pay one of my own. May as well just move into mine instead of rent and then just save a load of cash.

boliston

adonis10 wrote: »

We'd make sure there was something very clear and legal in place before hand to eliminate any issues further down the line.

I take that point, but I'm not interested in paying someone else's mortgage. Not a fan of mortgages at the best of time so will only ever pay one of my own. May as well just move into mine instead of rent and then just save a load of cash.

You would be surprised how few rental units are mortgaged - I did a search on some neighbouring flats in my block (almost all rented apart from my my own and a small handful of others) and they mainly seemed to be owned by a single Guernsey based holding company with no mortgages registered.

adonis10

boliston wrote: »

You would be surprised how few rental units are mortgaged - I did a search on some neighbouring flats in my block (almost all rented apart from my my own and a small handful of others) and they mainly seemed to be owned by a single Guernsey based holding company with no mortgages registered.

Ah, fair enough. Figures, I guess. Part of the 1% who own almost everything!

Even still, rather not just throw money away on rent. Admittedly no one knows what would happen with the housing market, but I imagine long term it's safer than lining someone's pocket in a tax haven.

Pixie5740

adonis10 wrote: »

Why's that then?

To be fair I think I'd probably do it myself (after much research) and save £100 ish a month. At least then I'm in full control and can personally pick tenants etc.

Letting agencies require no specific training or qualifications. Any eejit can become a letting agent as is seen on a daily basis on this board by tenants and landlords alike.

Not to mention that letting agency fees eat a large chunk of your profits and at the first sign of trouble many are about as much use as a marzipan dildo.

If you become and landlord your time and money would be much better spent joining a landlord association.

getmore4less

One way to protect your cash is offset mortgage.

You go in 50:50 with your £20k each deposits. still get the big mortgage

You offset your share(in a solo account) so you pay less interest and protect you capital.

Also gives a much more flexible cash flow in case of rate rises


IME always go for a better place if you can, if not bigger(more rooms), bigger rooms, better location, better features, more offroad parking, garage, study/work room, extra bathroom etc.

adonis10

getmore4less wrote: »

One way to protect your cash is offset mortgage.

You go in 50:50 with your £20k each deposits. still get the big mortgage

You offset your share(in a solo account) so you pay less interest and protect you capital.

Also gives a much more flexible cash flow in case of rate rises


IME always go for a better place if you can, if not bigger(more rooms), bigger rooms, better location, better features, more offroad parking, garage, study/work room, extra bathroom etc.

Thanks, I'll look into it.

Better = more expensive. We don't want to burden ourselves with more debt than we need to as rates will go up and we don't want to be slaves to the bank (well, more than we are already, of course).

getmore4less

Stay in the flat

adonis10

getmore4less wrote: »

Stay in the flat

My preferred option as it's how I like it and in a great location, however we want something a little bigger and that is 'ours', as much as I love my man flat (as does the gf) she wants to be able to put her stamp on somewhere, which is fair enough.

onlyroz

Another option is to mortgage the flat to the hilt, rent it out, and use the equity as a deposit on your new place. Normally you would be able to get a 75% buy-to-let mortgage on the assumption that the expected rental income was greater than the mortgage repayments. This way you get to keep the flat and have a larger deposit for your new house.

adonis10

onlyroz wrote: »

Another option is to mortgage the flat to the hilt, rent it out, and use the equity as a deposit on your new place. Normally you would be able to get a 75% buy-to-let mortgage on the assumption that the expected rental income was greater than the mortgage repayments. This way you get to keep the flat and have a larger deposit for your new house.

An option but I really don't want two mortgages. Also, BTL rates are higher so I'd be paying more in the first place and even more when rates go up. Obviously I could claim mortgage interest against the income so would have to work out how much that would offset the higher btl mortgage rate.