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Would I make more money getting on the property ladder or from saving living with parents?

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What would make me have more money in the long term? Getting on the property ladder or continue living with parents?

Say I get on the property ladder in an area where house prices are rising super fast. Let's say 5% per year. I buy a £180k house with a £25-30k deposit on the mortgage. The house would be a 2 bed that just myself would live in.

Or alternatively, I continue living at home with my parents where I can save about £1k a month (salary is £1.7k a month or £27k a year).
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Comments

  • Marvel1
    Marvel1 Posts: 7,436 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    Personally I would move out for the independence.
  • Socajam
    Socajam Posts: 1,238 Forumite
    1,000 Posts Second Anniversary Name Dropper
    I agree with Marvel1, if you an afford it buy the property.
    You cannot never go wrong and if things become tight, get a lodger
  • bp5678
    bp5678 Posts: 413 Forumite
    Third Anniversary 100 Posts Name Dropper
    Marvel1 wrote: »
    Personally I would move out for the independence.

    Thanks for replying so quickly. I'm focusing more on from a financial perspective which i guess is more factual/objective/statistical as wanting the independence is more of a personal thing.
  • 00ec25
    00ec25 Posts: 9,123 Forumite
    1,000 Posts Combo Breaker
    bp5678 wrote: »
    Thanks for replying so quickly. I'm focusing more on from a financial perspective which i guess is more factual/objective/statistical as wanting the independence is more of a personal thing.
    then your question has a perfect, factual, absolute answer based on the maths using your numbers. Feel free to answer it yourself.

    #allow for inflation and mortgage costs
  • letitbe90
    letitbe90 Posts: 345 Forumite
    bp5678 wrote: »
    What would make me have more money in the long term? Getting on the property ladder or continue living with parents?

    Say I get on the property ladder in an area where house prices are rising super fast. Let's say 5% per year. I buy a £180k house with a £25-30k deposit on the mortgage. The house would be a 2 bed that just myself would live in.

    Or alternatively, I continue living at home with my parents where I can save about £1k a month (salary is £1.7k a month or £27k a year).

    Surely a high rising place will add a premium on its value based on the fact that is rising fast, negating the growth somewhat?

    I’d say save that £1k monthly into some passive find like vanguard/fidelity etc and call it a day.
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    bp5678 wrote: »
    Say I get on the property ladder in an area where house prices are rising super fast. Let's say 5% per year.

    What's going to sustain the rapid increases in price? Interest rates aren't likely to drop any lower nor are wage increases (in general) likely to be that significant. Markets ultimately return the mean. Even if they move ahead of the curve in the short term.
  • Gwendo40
    Gwendo40 Posts: 349 Forumite
    Unless you're intending to then downsize and move to a much cheaper area then buying a house in an area where ''prices are rising fast'' makes little financial sense purely in terms of ''making money''
  • SG27
    SG27 Posts: 2,773 Forumite
    edited 21 April 2019 at 7:14AM
    Unless your house rises a lot in price and you then sell up and move back to your parents you will never realise any profit.

    The "return" you get from buying a house to live in is security of somewhere to live. (But also of the liability of maintaining the property) it may be an asset you can leave to your children, or can be sold to pay for your care in old age.

    If you are looking to make money then you should look at investments or BTL
  • Sea_Shell
    Sea_Shell Posts: 10,022 Forumite
    Tenth Anniversary 1,000 Posts Photogenic Name Dropper
    Rather than the pure financial maths of it, i'd be asking myself, "where do I see myself in 5-10 years time?". Would you be happy living with your parents forever? What's your goal? How old are you?

    You don't mention how much "keep" will you be paying them towards the running of the household, or are they prepared to let you stay "rent" free forever?

    In life, it's not all about doing the things that makes you the most ££££'s. It helps to enjoy your life along the way too.
    How's it going, AKA, Nutwatch? - 12 month spends to date = 2.60% of current retirement "pot" (as at end May 2025)
  • onwards&upwards
    onwards&upwards Posts: 3,423 Forumite
    1,000 Posts Second Anniversary Name Dropper
    edited 21 April 2019 at 10:02AM
    Bet your parents are really pleased you’re asking this!

    Don’t you think they deserve to be able to move on from the ‘kids at home’ stage of their lives and get their privacy and freedom back?
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