Rent now, wait for the crash and then buy?

adonis10

mrginge wrote: »

I believe there is a nuclear winter pencilled in for 2065. Probably best to wait until after then tbh.

Good bants.

saverbuyer

Tough one. I bought a few years after the NI crash. Probably saved a good 300-400k. I waited from 2007-2013 while prices crashed.


Are you prepared to wait 6 years?

pinkshoes

I bought a HOME in December 2006 just before the crash, then sold for £10k less (less than 5% loss) in 2012.

Not all areas crashed spectacularly.

If we had rented during those 5.5 years, we would have paid £800+ a month in rent, and our mortgage interest (comparable to rent) was only £500. We also had our own home.

If you don't need to move, then the value isnt an issue.

Cakeguts

Work out how long you think you are going to be staying in the area that you are buying in and then take it from there. If you think you might want to stay for several years then it is probably worth buying a house. What you want to avoid if at all possible is the keep buying and selling aspect because even if there isn't a crash in house prices it is still going to cost you money to move.

If you can pay the mortgage off then it doesn't make any difference to what the prices do because it will only be numbers on paper if you continue to live there.

Ithaca

I bought right at the top of the market in March 2007. House lost £1000s but then recovered and we made money on it when we sold last year. But as others have pointed out, the house we bought would have gained and lost around the same percentage over that period so as we were staying in the same local market it didn't really make much difference.

economic

why not buy a high dividend stock portfolio and use the dividends from that to pay for rent?

adonis10

saverbuyer wrote: »

Tough one. I bought a few years after the NI crash. Probably saved a good 300-400k. I waited from 2007-2013 while prices crashed.


Are you prepared to wait 6 years?

No, I don't think we are. Besides, at at least £1,000 a month rent, that would be at least £72k down the drain over a 6 year period. That is half the mortgage that we are planning to get.


Saved 300-400? Wow, the place must be worth a fair whack now!

adonis10

economic wrote: »

why not buy a high dividend stock portfolio and use the dividends from that to pay for rent?

And how much of an investment would be required to yield £400/month (the difference between the £600 mortgage we plan to pay and the ~£1k/month rent)?!

saverbuyer

adonis10 wrote: »

No, I don't think we are. Besides, at at least £1,000 a month rent, that would be at least £72k down the drain over a 6 year period. That is half the mortgage that we are planning to get.


Saved 300-400? Wow, the place must be worth a fair whack now!

Prices went crazy here until 2007 and dropped 60% in 5 years.
Be lucky if they've gone up 10% in the last 3 years. Not buying in 2007 really did save me hundreds of thousands.


In NI it's usually cheaper to rent than buy. Particularly in my price bracket. The waiting wasn't such a big choice.

UKmitch

Buy something, anything you can afford - why? Because renting you're 100% throwing your money away - it won't change in the future - but buying, even if it does crash, you'll still have something to show for it, however little.