Unsure if I want a house now?

PixelPound

Rosieandjim wrote: »

What is STEM?

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Planet_Switzerland

Crashy_Time wrote: »

If there is a proper correction in the housing market I would rather be attached to savings/investments and a cheap rental than a large mortgage, especially if rising rates are a factor in the correction. This also makes it easier to move for work if things get really bad.

Sounds good in theory, but my rental was cheap by London standards and my mortgage is actually £1 a month cheaper than what the place I rented went up for when I moved out. As for moving for work, around 90% of jobs doing what I do are London based so unlikely I'd need to relocate.

Crashy_Time

Planet_Switzerland wrote: »

Sounds good in theory, but my rental was cheap by London standards and my mortgage is actually £1 a month cheaper than what the place I rented went up for when I moved out. As for moving for work, around 90% of jobs doing what I do are London based so unlikely I'd need to relocate.

What happens if rates rise or the value of your house crashes, and you still have to do all your own repairs, and you can`t sell if you DID decide to move for whatever reason? Wouldn`t you have been better paying under the normal rent to draw London wages and saving/investing the difference? You are effectively gambling on interest rates and London house prices, an index tracker would have been safer at this stage IMO.

PixelPound

Resh wrote: »

OP, I'm 50 years old and have just bought, with my partner, my first home. I've been a tenant for all of my adult life and have relished the freedom that brought me. I've been quite nomadic, and had a world of financial problems in my early adult life, and renting was the right thing to do. I've never been obsessed with getting on the housing ladder - in fact in the early 2000s I worked in the mortgage industry in the US and swore never to have a mortgage because I'd seen what it did to people when things went wrong. Back then I too had zero debt and no credit either and at the time it was the right thing to do.

My advice would be to stay the course. There is no need to rush into home ownership and no reason to do it ever if you aren't comfortable taking on that debt. It's really a very personal choice, but don't buy a house just because it's what we're 'supposed' to do.

It is a very British thing that says you must get on the housing ladder and those that rent do so because they can't afford to buy. As is pushing for better houses and bigger mortgages.

OP you need to look at why you do/don't want to buy and what each gives you. I was happy renting for years as that gave me a lot of flexibility to move around with jobs, have several holidays a year etc. Around europe home ownership is a lot less of a priority.

Pixie5740

Crashy_Time wrote: »

What happens if rates rise or the value of your house crashes, and you still have to do all your own repairs, and you can`t sell if you DID decide to move for whatever reason? Wouldn`t you have been better paying under the normal rent to draw London wages and saving/investing the difference? You are effectively gambling on interest rates and London house prices, an index tracker would have been safer at this stage IMO.

What if the stock market crashes or you just pick some poor investments? What if you get hit buy a bus tomorrow? What if the sky falls down Chicken Licken? If you spent your whole like not doing things because of "what if" you'd never do anything.

Planet_Switzerland

Crashy_Time wrote: »

What happens if rates rise or the value of your house crashes, and you still have to do all your own repairs, and you can`t sell if you DID decide to move for whatever reason? Wouldn`t you have been better paying under the normal rent to draw London wages and saving/investing the difference? You are effectively gambling on interest rates and London house prices, an index tracker would have been safer at this stage IMO.

The overpayments I make each month means I pay more than I would on the SVR, so if the rates went up I can afford it. If the value of my property crashes, it's still the same amount I need to pay back which is an amount I can afford. My monthly mortgage payment is £1 cheaper than my rent payment would be, so what difference would I be saving.

Crashy_Time

Pixie5740 wrote: »

What if the stock market crashes or you just pick some poor investments? What if you get hit buy a bus tomorrow? What if the sky falls down Chicken Licken? If you spent your whole like not doing things because of "what if" you'd never do anything.

Buying into a property bubble is not quite the same as setting out to climb Mount Everest.

Crashy_Time

Planet_Switzerland wrote: »

The overpayments I make each month means I pay more than I would on the SVR, so if the rates went up I can afford it. If the value of my property crashes, it's still the same amount I need to pay back which is an amount I can afford. My monthly mortgage payment is £1 cheaper than my rent payment would be, so what difference would I be saving.

The difference between what a "normal" rent in London would be and what you were actually paying, or in your case now the difference between emergency interest rates and "normalised" rates. By pouring everything into the property you lose everything when the market goes South, better to keep money in other places, especially if you think low rates will persist as you are effectively now just renting the money instead of a property?

sparky130a

Planet_Switzerland wrote: »

If I was renting though I'd still need to make the rent payments, but also because my savings were over £16k I'd get no benefits so would see my savings go down and down. At least if I did get my property repossessed I'd get some money back from it.

I wouldn't bet on it.

And the CCJ to go with it would hardly be welcome....

dktreesea

Pixie5740 wrote: »

What if the stock market crashes or you just pick some poor investments? What if you get hit buy a bus tomorrow? What if the sky falls down Chicken Licken? If you spent your whole like not doing things because of "what if" you'd never do anything.

Well put. It took me years to buy a house, and even though I could have afforded to buy in the inner city, I bought a lifestyle property on the edge of town. Then spent 4 years (until we sold it) regretting it and thankfully living in it for free in the end because it went up in value quite a lot.


There's no "good time" to buy a house. All of the problems, (e.g. how do you afford the mortgage if you are laid off? What happens if something goes wrong with the house and you can't afford to fix it? Having to insure and maintain it. Having to take time to do things like mow the lawn. Roof repairs, rising damp. Mould.) exist no matter how cheap or expensive the house.


Renters without savings don't have that problem - they just claim housing benefit until they are back in work.