Pitfalls of Diligent Saving

Crashy_Time

Mickey666 said:

Crashy_Time said:

Mickey666 said:

Crashy_Time said:

Mickey666 said:

BikingBud said:

Mickey666 said:

 That doesn't make much sense to me.  A very effective way to "have us over a barrel" is to prevent us from being independently wealthy.  Restricting people to rented housing for their whole lives means they are always beholden to someone else for one of the most fundamental human needs - shelter, a home.  It's a very effective means of oppression and forces people to work all their lives, historically until they dropped. 

Home ownership gives people a greater degree of independence, wealth, choice.  If you really wanted to have people "over a barrel" then preventing them from owning their own homes is a very effective way to do so . . .  as it was historically in more feudal times.

Home ownership does not occur until the mortgage is paid off, and often inhibits independence, this is especially so where we find people tied to mortgages for their entire working lives by 30 and 35 year mortgages.  Yes you may be able to hang whatever wall paper or put whatever coloured bathroom suite in that you desire, however, you are still tied to many years of payments before you "own" the property.  Until you pay off the final amount you are a slave to the terms and conditions that the financial institutions may wish to enforce such as interest rates and other whims of the market. 

We recognise that for IO mortgages why do feel the concept is any different for repayment mortgages? If you owe you don't own!

That's not legally correct.  The LR title defines the legal owner and that will be the mortgagor, not the lender.  A mortgage is simply a loan secured on your property, your legally-owned property.

But of course you're right that if you have a mortgage then you are a 'slave' to their repayment terms, in the same way that if you rent your home you're a 'slave' to your Landlord's terms.  The big difference, of course, is that a mortgage will eventually end, unlike renting.

It is easier to change landlord though than change mortgage, you are basically not going to be able to dictate terms to a mortgage lender whereas you can move to more favourable rental terms (price, location, landlord etc.) anytime you want? 

You're not going to be able to dictate terms to a landlord either.  And of course home owners can move to more favourable mortgage terms (price, location, lender etc) anytime they want (yes, you need to sell your house, but renters are usually tied in to a minimum 6-month tenancy anyway and I've managed to move home as an owner quicker than that before now).   It's not always frustration-free of course, but neither is moving between rented properties.  At the risk of being called sexist, I'd liken it to childbirth - it can be a painful process but the rewards are so great that many women choose to do it again.  And again.

I've moved home as an owner many times, and I'd guess that most home owners on here have done it as well. and each time to move was more favourable for a number of reasons.  In fact my last move as a home owner was so much more favourable that I was able to retire at 50 because I was able to release a whole load of equity by moving to a cheaper property.  Try doing that while renting.

Do you think the people stretching themselves into the bubble right now because they can`t afford the stamp duty and want to do their own wallpaper at any cost will retire at 50? Yor "six month" statement is surely a desperate argument though LOL, renters can move same day if they want, a homeowner/mortgage debtor has to wait for a buyer in most cases?

It's possible - depends how old they are - but you've swerved my point as usual.  You can release equity as a home owner by moving to a cheaper property.  How much equity will you release if you move to a cheaper rental?

As for renters moving on the same day if they want, how does that work with their tenancy contract?

You release the "opportunity cost" of the saved money to be added to other savings/investments, a renter for the most part can do this much more easily than someone reliant on a buyer to give them their "equity".

As long as the rent is paid for the notice period it is doubtful that a landlord cares if the tenant is physically present at the address? Obviously they may need to turn up for a check out/deposit return meeting if they require the return of any deposit handed over.

Mickey666

You're cracking me up now
So you can move to a cheaper rental and release the 'opportunity cost' of a couple of £100 per month to invest elsewhere while I can move to a cheaper house and release enough equity to retire at 50.   If only I had waited for your fabled price crash and not made the mistake of buying my own home - just think where I could be now

As for a renter being able to move any day they like as long as they pay their notice period (which of course might be 6 months or more), well guess what, mortgage owners can do that as well as long as they continue to pay their mortgage!   Who'd have thought it?!
I really can't believe you seriously think that's one of the big advantages of renting over buying. 

But just in case you really do, perhaps you could give this poster the benefit of your experience of how to get out of a tenancy agreement and point out that their partner is not really trapped at all, as long as they keep paying the rent!  LOL
https://forums.moneysavingexpert.com/discussion/6242289/trying-to-end-a-rental-tenancy-agreement/p1

Crashy_Time

Mickey666 said:

You're cracking me up now
So you can move to a cheaper rental and release the 'opportunity cost' of a couple of £100 per month to invest elsewhere while I can move to a cheaper house and release enough equity to retire at 50.   If only I had waited for your fabled price crash and not made the mistake of buying my own home - just think where I could be now

As for a renter being able to move any day they like as long as they pay their notice period (which of course might be 6 months or more), well guess what, mortgage owners can do that as well as long as they continue to pay their mortgage!   Who'd have thought it?!
I really can't believe you seriously think that's one of the big advantages of renting over buying. 

But just in case you really do, perhaps you could give this poster the benefit of your experience of how to get out of a tenancy agreement and point out that their partner is not really trapped at all, as long as they keep paying the rent!  LOL
https://forums.moneysavingexpert.com/discussion/6242289/trying-to-end-a-rental-tenancy-agreement/p1

Someone who you are advising to join the bubble now though won`t be releasing that sort of equity, they will be stuck in negative equity?

Yes a mortgage owner can move and continue to pay their mortgage, but are they paying for where they move to as well? The renter is moving from one rent to a cheaper rent. We can go back and forth all day but the truth is that renting is far more flexible than having mortgage debt, it really doesn`t matter how many ways we try to spin it. When was the last time you rented somewhere that required six months notice to leave?

Mickey666

Well the cost of your supposed renting flexibility is far too steep for me, in fact I don't think I could actually afford it, just like I couldn't afford to rent an equivalent house to the one I'm now living in for free.  I hope that flexibility straw you're clutching at is really worth all the rental money you're spending on it every month.

[Deleted User]

Crashy_Time said:

Mickey666 said:

You're cracking me up now
So you can move to a cheaper rental and release the 'opportunity cost' of a couple of £100 per month to invest elsewhere while I can move to a cheaper house and release enough equity to retire at 50.   If only I had waited for your fabled price crash and not made the mistake of buying my own home - just think where I could be now

As for a renter being able to move any day they like as long as they pay their notice period (which of course might be 6 months or more), well guess what, mortgage owners can do that as well as long as they continue to pay their mortgage!   Who'd have thought it?!
I really can't believe you seriously think that's one of the big advantages of renting over buying. 

But just in case you really do, perhaps you could give this poster the benefit of your experience of how to get out of a tenancy agreement and point out that their partner is not really trapped at all, as long as they keep paying the rent!  LOL
https://forums.moneysavingexpert.com/discussion/6242289/trying-to-end-a-rental-tenancy-agreement/p1

Someone who you are advising to join the bubble now though won`t be releasing that sort of equity, they will be stuck in negative equity?

Yes a mortgage owner can move and continue to pay their mortgage, but are they paying for where they move to as well? The renter is moving from one rent to a cheaper rent. We can go back and forth all day but the truth is that renting is far more flexible than having mortgage debt, it really doesn`t matter how many ways we try to spin it. When was the last time you rented somewhere that required six months notice to leave?

How long has this supposed bubble being going on for now? I bet you could have bought your current home twice over by now and be paying neither rent nor a mortgage going by how long you’ve been banging on about the bubble. 

[Deleted User]

Crashy_Time said:

Mickey666 said:

BikingBud said:

Mickey666 said:

 That doesn't make much sense to me.  A very effective way to "have us over a barrel" is to prevent us from being independently wealthy.  Restricting people to rented housing for their whole lives means they are always beholden to someone else for one of the most fundamental human needs - shelter, a home.  It's a very effective means of oppression and forces people to work all their lives, historically until they dropped. 

Home ownership gives people a greater degree of independence, wealth, choice.  If you really wanted to have people "over a barrel" then preventing them from owning their own homes is a very effective way to do so . . .  as it was historically in more feudal times.

Home ownership does not occur until the mortgage is paid off, and often inhibits independence, this is especially so where we find people tied to mortgages for their entire working lives by 30 and 35 year mortgages.  Yes you may be able to hang whatever wall paper or put whatever coloured bathroom suite in that you desire, however, you are still tied to many years of payments before you "own" the property.  Until you pay off the final amount you are a slave to the terms and conditions that the financial institutions may wish to enforce such as interest rates and other whims of the market. 

We recognise that for IO mortgages why do feel the concept is any different for repayment mortgages? If you owe you don't own!

That's not legally correct.  The LR title defines the legal owner and that will be the mortgagor, not the lender.  A mortgage is simply a loan secured on your property, your legally-owned property.

But of course you're right that if you have a mortgage then you are a 'slave' to their repayment terms, in the same way that if you rent your home you're a 'slave' to your Landlord's terms.  The big difference, of course, is that a mortgage will eventually end, unlike renting.

It is easier to change landlord though than change mortgage, you are basically not going to be able to dictate terms to a mortgage lender whereas you can move to more favourable rental terms (price, location, landlord etc.) anytime you want? 

This is true, but it also gives that constant feeling of the rental house could be pulled from under you. Perhaps not right now with the eviction ban and then all the backlogs that will follow, but the house is not “yours” to do what you want with it and there is no sense of security.  

I bought my first property at 18, then started doubling up, letting one out, making money over time, which I put into pension funds and bought the house Im in at 35 by selling two houses. This is my forever house. One house I owned literally doubled in value 1999/2000 in 18 months. 

I also own another house for my sons inheritance and will soon buy another for my other son, although he will have to rent short term as he and his partner have a surprise pregnancy. 

The houses are all over time increasing in value in Greater London. 

I retired at 50 and will never need to work again. 

Ive never been a very high earner ( ie investment bank/ CEO level) but Ive made the most of my alright income money. 

No way could I have EVER done anything like that with renting, and it is ridiculous to suggest otherwise IMHO. 

Davesnave

Densol said:

Crashy_Time said:

Mickey666 said:

BikingBud said:

Mickey666 said:

 That doesn't make much sense to me.  A very effective way to "have us over a barrel" is to prevent us from being independently wealthy.  Restricting people to rented housing for their whole lives means they are always beholden to someone else for one of the most fundamental human needs - shelter, a home.  It's a very effective means of oppression and forces people to work all their lives, historically until they dropped. 

Home ownership gives people a greater degree of independence, wealth, choice.  If you really wanted to have people "over a barrel" then preventing them from owning their own homes is a very effective way to do so . . .  as it was historically in more feudal times.

Home ownership does not occur until the mortgage is paid off, and often inhibits independence, this is especially so where we find people tied to mortgages for their entire working lives by 30 and 35 year mortgages.  Yes you may be able to hang whatever wall paper or put whatever coloured bathroom suite in that you desire, however, you are still tied to many years of payments before you "own" the property.  Until you pay off the final amount you are a slave to the terms and conditions that the financial institutions may wish to enforce such as interest rates and other whims of the market. 

We recognise that for IO mortgages why do feel the concept is any different for repayment mortgages? If you owe you don't own!

That's not legally correct.  The LR title defines the legal owner and that will be the mortgagor, not the lender.  A mortgage is simply a loan secured on your property, your legally-owned property.

But of course you're right that if you have a mortgage then you are a 'slave' to their repayment terms, in the same way that if you rent your home you're a 'slave' to your Landlord's terms.  The big difference, of course, is that a mortgage will eventually end, unlike renting.

It is easier to change landlord though than change mortgage, you are basically not going to be able to dictate terms to a mortgage lender whereas you can move to more favourable rental terms (price, location, landlord etc.) anytime you want? 

No way could I have EVER done anything like that with renting, and it is ridiculous to suggest otherwise IMHO. 

You could have made as much money over the years with skilled investment, regardless of where you lived. Some of my shares have more than doubled in price in the past 6 months and a few types cryptocurrency have done better still.

lookstraightahead

Densol said:

Crashy_Time said:

Mickey666 said:

BikingBud said:

Mickey666 said:

 That doesn't make much sense to me.  A very effective way to "have us over a barrel" is to prevent us from being independently wealthy.  Restricting people to rented housing for their whole lives means they are always beholden to someone else for one of the most fundamental human needs - shelter, a home.  It's a very effective means of oppression and forces people to work all their lives, historically until they dropped. 

Home ownership gives people a greater degree of independence, wealth, choice.  If you really wanted to have people "over a barrel" then preventing them from owning their own homes is a very effective way to do so . . .  as it was historically in more feudal times.

Home ownership does not occur until the mortgage is paid off, and often inhibits independence, this is especially so where we find people tied to mortgages for their entire working lives by 30 and 35 year mortgages.  Yes you may be able to hang whatever wall paper or put whatever coloured bathroom suite in that you desire, however, you are still tied to many years of payments before you "own" the property.  Until you pay off the final amount you are a slave to the terms and conditions that the financial institutions may wish to enforce such as interest rates and other whims of the market. 

We recognise that for IO mortgages why do feel the concept is any different for repayment mortgages? If you owe you don't own!

That's not legally correct.  The LR title defines the legal owner and that will be the mortgagor, not the lender.  A mortgage is simply a loan secured on your property, your legally-owned property.

But of course you're right that if you have a mortgage then you are a 'slave' to their repayment terms, in the same way that if you rent your home you're a 'slave' to your Landlord's terms.  The big difference, of course, is that a mortgage will eventually end, unlike renting.

It is easier to change landlord though than change mortgage, you are basically not going to be able to dictate terms to a mortgage lender whereas you can move to more favourable rental terms (price, location, landlord etc.) anytime you want? 

This is true, but it also gives that constant feeling of the rental house could be pulled from under you. Perhaps not right now with the eviction ban and then all the backlogs that will follow, but the house is not “yours” to do what you want with it and there is no sense of security.  

I bought my first property at 18, then started doubling up, letting one out, making money over time, which I put into pension funds and bought the house Im in at 35 by selling two houses. This is my forever house. One house I owned literally doubled in value 1999/2000 in 18 months. 

I also own another house for my sons inheritance and will soon buy another for my other son, although he will have to rent short term as he and his partner have a surprise pregnancy. 

The houses are all over time increasing in value in Greater London. 

I retired at 50 and will never need to work again. 

Ive never been a very high earner ( ie investment bank/ CEO level) but Ive made the most of my alright income money. 

No way could I have EVER done anything like that with renting, and it is ridiculous to suggest otherwise IMHO. 

But you've used the rental market to make your wealth.
Completely you're prerogative of course but you can see how for some others with not a high income could struggle to buy now if they can't get into a first purchase.

Angela_D_3

lookstraightahead said:

Densol said:

Crashy_Time said:

Mickey666 said:

BikingBud said:

Mickey666 said:

 That doesn't make much sense to me.  A very effective way to "have us over a barrel" is to prevent us from being independently wealthy.  Restricting people to rented housing for their whole lives means they are always beholden to someone else for one of the most fundamental human needs - shelter, a home.  It's a very effective means of oppression and forces people to work all their lives, historically until they dropped. 

Home ownership gives people a greater degree of independence, wealth, choice.  If you really wanted to have people "over a barrel" then preventing them from owning their own homes is a very effective way to do so . . .  as it was historically in more feudal times.

Home ownership does not occur until the mortgage is paid off, and often inhibits independence, this is especially so where we find people tied to mortgages for their entire working lives by 30 and 35 year mortgages.  Yes you may be able to hang whatever wall paper or put whatever coloured bathroom suite in that you desire, however, you are still tied to many years of payments before you "own" the property.  Until you pay off the final amount you are a slave to the terms and conditions that the financial institutions may wish to enforce such as interest rates and other whims of the market. 

We recognise that for IO mortgages why do feel the concept is any different for repayment mortgages? If you owe you don't own!

That's not legally correct.  The LR title defines the legal owner and that will be the mortgagor, not the lender.  A mortgage is simply a loan secured on your property, your legally-owned property.

But of course you're right that if you have a mortgage then you are a 'slave' to their repayment terms, in the same way that if you rent your home you're a 'slave' to your Landlord's terms.  The big difference, of course, is that a mortgage will eventually end, unlike renting.

It is easier to change landlord though than change mortgage, you are basically not going to be able to dictate terms to a mortgage lender whereas you can move to more favourable rental terms (price, location, landlord etc.) anytime you want? 

This is true, but it also gives that constant feeling of the rental house could be pulled from under you. Perhaps not right now with the eviction ban and then all the backlogs that will follow, but the house is not “yours” to do what you want with it and there is no sense of security.  

I bought my first property at 18, then started doubling up, letting one out, making money over time, which I put into pension funds and bought the house Im in at 35 by selling two houses. This is my forever house. One house I owned literally doubled in value 1999/2000 in 18 months. 

I also own another house for my sons inheritance and will soon buy another for my other son, although he will have to rent short term as he and his partner have a surprise pregnancy. 

The houses are all over time increasing in value in Greater London. 

I retired at 50 and will never need to work again. 

Ive never been a very high earner ( ie investment bank/ CEO level) but Ive made the most of my alright income money. 

No way could I have EVER done anything like that with renting, and it is ridiculous to suggest otherwise IMHO. 

But you've used the rental market to make your wealth.
Completely you're prerogative of course but you can see how for some others with not a high income could struggle to buy now if they can't get into a first purchase.

Imo the mistake is thinking the first house must be the forever home and all that !!!!!!.  Just buy something.  I raised the deposit on my children’s house by saving £6,000.  Buying a three bed terrace,  renting it out and ill clear that mortgage in full in 2 years.  The tenant will have contributed about £9000 to the mortgage but HPI will add an additional £12,000.  £19,000 in 5 years.  Even at 25% tax its not a bad days work.  

Crashy_Time

Densol said:

Crashy_Time said:

Mickey666 said:

BikingBud said:

Mickey666 said:

 That doesn't make much sense to me.  A very effective way to "have us over a barrel" is to prevent us from being independently wealthy.  Restricting people to rented housing for their whole lives means they are always beholden to someone else for one of the most fundamental human needs - shelter, a home.  It's a very effective means of oppression and forces people to work all their lives, historically until they dropped. 

Home ownership gives people a greater degree of independence, wealth, choice.  If you really wanted to have people "over a barrel" then preventing them from owning their own homes is a very effective way to do so . . .  as it was historically in more feudal times.

Home ownership does not occur until the mortgage is paid off, and often inhibits independence, this is especially so where we find people tied to mortgages for their entire working lives by 30 and 35 year mortgages.  Yes you may be able to hang whatever wall paper or put whatever coloured bathroom suite in that you desire, however, you are still tied to many years of payments before you "own" the property.  Until you pay off the final amount you are a slave to the terms and conditions that the financial institutions may wish to enforce such as interest rates and other whims of the market. 

We recognise that for IO mortgages why do feel the concept is any different for repayment mortgages? If you owe you don't own!

That's not legally correct.  The LR title defines the legal owner and that will be the mortgagor, not the lender.  A mortgage is simply a loan secured on your property, your legally-owned property.

But of course you're right that if you have a mortgage then you are a 'slave' to their repayment terms, in the same way that if you rent your home you're a 'slave' to your Landlord's terms.  The big difference, of course, is that a mortgage will eventually end, unlike renting.

It is easier to change landlord though than change mortgage, you are basically not going to be able to dictate terms to a mortgage lender whereas you can move to more favourable rental terms (price, location, landlord etc.) anytime you want? 

This is true, but it also gives that constant feeling of the rental house could be pulled from under you. Perhaps not right now with the eviction ban and then all the backlogs that will follow, but the house is not “yours” to do what you want with it and there is no sense of security.  

I bought my first property at 18, then started doubling up, letting one out, making money over time, which I put into pension funds and bought the house Im in at 35 by selling two houses. This is my forever house. One house I owned literally doubled in value 1999/2000 in 18 months. 

I also own another house for my sons inheritance and will soon buy another for my other son, although he will have to rent short term as he and his partner have a surprise pregnancy. 

The houses are all over time increasing in value in Greater London. 

I retired at 50 and will never need to work again. 

Ive never been a very high earner ( ie investment bank/ CEO level) but Ive made the most of my alright income money. 

No way could I have EVER done anything like that with renting, and it is ridiculous to suggest otherwise IMHO. 

Do you think someone buying now could do the same?