Buy home or wait for a few months

GDB2222

I thought the OP asked whether he should buy now, or put it off for a year or two. We are two pages into this thread, but has anyone attempted to answer that?

FWIW, my view is that prices have not yet adjusted to interest rate rises. So, I would wait a bit, and then reassess. 

https://www.bankofengland.co.uk/-/media/boe/files/working-paper/2019/uk-house-prices-and-three-decades-of-decline-in-the-risk-free-real-interest-rate.pdf

Schwarzwald

grumbler said:

MFWannabe said:

grumbler said:

moneysaver1978 said:

darksnake09 said:

Hi Guys,

I am in my late 20's and am very puzzled on what step to take so I home someone can shine some light.

I am looking to purchased my first time home, I know no one knows when the right time is but should I wait till the end of the year or next year and see if there is a crash in the housing market along side if interest rates come down. I am renting at the moment but it really feels like money is getting wasted.

Many Thanks !

  how much rent are you paying vs how much mortgage repayments.

IMO, it makes sense to compare the rent to the interest payments, not to mortgage repayments. Anything you pay on the top of the interest is your savings.
That said, first years interest makes the biggest part of monthly payments and the 'savings' are quite small.

This makes no sense 
Of course you need to compare mortgage payments to rent payments 
If you’re paying £1000 per month for rental over 5 years you’ll have paid 60k in rental as opposed to paying off your own mortgage 

If you pay £1000 p.m. over, say, 20 years (mortgage term), at the end you paid £240K and you own the house.

If you pay £1000 rent, you paid  £240K and own nothing.

Does this make no difference to you?

let me improve that for you:

If you pay £1000 p.m. over, say, 20 years (mortgage term), at the end you paid £240K and you own the house, but you also spent probably 1-2% pa in maintenance or £100k total over 20 years so the adjusted value is more like £140k, plus if you get unlucky house prices might have dropped in your area, so even less ...

If you pay £1000 rent, you paid  £240K and dont own the property, but you also saved the deposit, say 10% or 24k initially, so if you manage to grow that deposit (opportunity costs) at 8-9% pa you end up also around 135k in value.

So you see ... many people will tell you buying is universally the better option, but it really just depends .....

MobileSaver

Schwarzwald said:

grumbler said:

MFWannabe said:

grumbler said:

moneysaver1978 said:

darksnake09 said:

Hi Guys,

I am in my late 20's and am very puzzled on what step to take so I home someone can shine some light.

I am looking to purchased my first time home, I know no one knows when the right time is but should I wait till the end of the year or next year and see if there is a crash in the housing market along side if interest rates come down. I am renting at the moment but it really feels like money is getting wasted.

Many Thanks !

  how much rent are you paying vs how much mortgage repayments.

IMO, it makes sense to compare the rent to the interest payments, not to mortgage repayments. Anything you pay on the top of the interest is your savings.
That said, first years interest makes the biggest part of monthly payments and the 'savings' are quite small.

This makes no sense 
Of course you need to compare mortgage payments to rent payments 
If you’re paying £1000 per month for rental over 5 years you’ll have paid 60k in rental as opposed to paying off your own mortgage 

If you pay £1000 p.m. over, say, 20 years (mortgage term), at the end you paid £240K and you own the house.

If you pay £1000 rent, you paid  £240K and own nothing.

Does this make no difference to you?

let me improve that for you:

If you pay £1000 p.m. over, say, 20 years (mortgage term), at the end you paid £240K and you own the house, but you also spent probably 1-2% pa in maintenance or £100k total over 20 years so the adjusted value is more like £140k, plus if you get unlucky house prices might have dropped in your area, so even less ...

If you pay £1000 rent, you paid  £240K and dont own the property, but you also saved the deposit, say 10% or 24k initially, so if you manage to grow that deposit (opportunity costs) at 8-9% pa you end up also around 135k in value.

So you see ... many people will tell you buying is universally the better option, but it really just depends .....

Oh dear! Where to start with your fundamentally flawed and misguided attempt to deter people from buying...

The elephant in the room is that you've paid £240,000 and own the house but twenty years later that house is now worth over £500,000! So even on your skewed figures buying means you would be more than £300,000 better off!

As for suggesting that 20 years on house prices might have dropped... how often in history has that happened?

CSI_Yorkshire

Schwarzwald said:

grumbler said:

MFWannabe said:

grumbler said:

moneysaver1978 said:

darksnake09 said:

Hi Guys,

I am in my late 20's and am very puzzled on what step to take so I home someone can shine some light.

I am looking to purchased my first time home, I know no one knows when the right time is but should I wait till the end of the year or next year and see if there is a crash in the housing market along side if interest rates come down. I am renting at the moment but it really feels like money is getting wasted.

Many Thanks !

  how much rent are you paying vs how much mortgage repayments.

IMO, it makes sense to compare the rent to the interest payments, not to mortgage repayments. Anything you pay on the top of the interest is your savings.
That said, first years interest makes the biggest part of monthly payments and the 'savings' are quite small.

This makes no sense 
Of course you need to compare mortgage payments to rent payments 
If you’re paying £1000 per month for rental over 5 years you’ll have paid 60k in rental as opposed to paying off your own mortgage 

If you pay £1000 p.m. over, say, 20 years (mortgage term), at the end you paid £240K and you own the house.

If you pay £1000 rent, you paid  £240K and own nothing.

Does this make no difference to you?

let me improve that for you:

If you pay £1000 p.m. over, say, 20 years (mortgage term), at the end you paid £240K and you own the house, but you also spent probably 1-2% pa in maintenance or £100k total over 20 years so the adjusted value is more like £140k, plus if you get unlucky house prices might have dropped in your area, so even less ...

If you pay £1000 rent, you paid  £240K and dont own the property, but you also saved the deposit, say 10% or 24k initially, so if you manage to grow that deposit (opportunity costs) at 8-9% pa you end up also around 135k in value.

So you see ... many people will tell you buying is universally the better option, but it really just depends .....

Assuming that you pay £5k per annum on maintenance and that house prices are static for 20 years on one hand, and then assuming 9% consistent investment growth on the other?

Yeah, we see which point you're trying to push.

MultiFuelBurner

Schwarzwald said:

grumbler said:

MFWannabe said:

grumbler said:

moneysaver1978 said:

darksnake09 said:

Hi Guys,

I am in my late 20's and am very puzzled on what step to take so I home someone can shine some light.

I am looking to purchased my first time home, I know no one knows when the right time is but should I wait till the end of the year or next year and see if there is a crash in the housing market along side if interest rates come down. I am renting at the moment but it really feels like money is getting wasted.

Many Thanks !

  how much rent are you paying vs how much mortgage repayments.

IMO, it makes sense to compare the rent to the interest payments, not to mortgage repayments. Anything you pay on the top of the interest is your savings.
That said, first years interest makes the biggest part of monthly payments and the 'savings' are quite small.

This makes no sense 
Of course you need to compare mortgage payments to rent payments 
If you’re paying £1000 per month for rental over 5 years you’ll have paid 60k in rental as opposed to paying off your own mortgage 

If you pay £1000 p.m. over, say, 20 years (mortgage term), at the end you paid £240K and you own the house.

If you pay £1000 rent, you paid  £240K and own nothing.

Does this make no difference to you?

let me improve that for you:

If you pay £1000 p.m. over, say, 20 years (mortgage term), at the end you paid £240K and you own the house, but you also spent probably 1-2% pa in maintenance or £100k total over 20 years so the adjusted value is more like £140k, plus if you get unlucky house prices might have dropped in your area, so even less ...

If you pay £1000 rent, you paid  £240K and dont own the property, but you also saved the deposit, say 10% or 24k initially, so if you manage to grow that deposit (opportunity costs) at 8-9% pa you end up also around 135k in value.

So you see ... many people will tell you buying is universally the better option, but it really just depends .....

What !!!??!!

Who spends £100k in maintenance over 20 years lol

Who gets 8-9% pa returns over 20 years lol

When in the last 20 years have house prices even been the same than 20 years previously. Likely hood the house would double in value if not more lol

Sunsaru

MultiFuelBurner said:

Schwarzwald said:

grumbler said:

MFWannabe said:

grumbler said:

moneysaver1978 said:

darksnake09 said:

Hi Guys,

I am in my late 20's and am very puzzled on what step to take so I home someone can shine some light.

I am looking to purchased my first time home, I know no one knows when the right time is but should I wait till the end of the year or next year and see if there is a crash in the housing market along side if interest rates come down. I am renting at the moment but it really feels like money is getting wasted.

Many Thanks !

  how much rent are you paying vs how much mortgage repayments.

IMO, it makes sense to compare the rent to the interest payments, not to mortgage repayments. Anything you pay on the top of the interest is your savings.
That said, first years interest makes the biggest part of monthly payments and the 'savings' are quite small.

This makes no sense 
Of course you need to compare mortgage payments to rent payments 
If you’re paying £1000 per month for rental over 5 years you’ll have paid 60k in rental as opposed to paying off your own mortgage 

If you pay £1000 p.m. over, say, 20 years (mortgage term), at the end you paid £240K and you own the house.

If you pay £1000 rent, you paid  £240K and own nothing.

Does this make no difference to you?

let me improve that for you:

If you pay £1000 p.m. over, say, 20 years (mortgage term), at the end you paid £240K and you own the house, but you also spent probably 1-2% pa in maintenance or £100k total over 20 years so the adjusted value is more like £140k, plus if you get unlucky house prices might have dropped in your area, so even less ...

If you pay £1000 rent, you paid  £240K and dont own the property, but you also saved the deposit, say 10% or 24k initially, so if you manage to grow that deposit (opportunity costs) at 8-9% pa you end up also around 135k in value.

So you see ... many people will tell you buying is universally the better option, but it really just depends .....

What !!!??!!

Who spends £100k in maintenance over 20 years lol

Who gets 8-9% pa returns over 20 years lol

When in the last 20 years have house prices even been the same than 20 years previously. Likely hood the house would double in value if not more lol

Also not forgetting that I've never seen or heard of anyone paying the same rent for 20 years.

MultiFuelBurner

Sunsaru said:

MultiFuelBurner said:

Schwarzwald said:

grumbler said:

MFWannabe said:

grumbler said:

moneysaver1978 said:

darksnake09 said:

Hi Guys,

I am in my late 20's and am very puzzled on what step to take so I home someone can shine some light.

I am looking to purchased my first time home, I know no one knows when the right time is but should I wait till the end of the year or next year and see if there is a crash in the housing market along side if interest rates come down. I am renting at the moment but it really feels like money is getting wasted.

Many Thanks !

  how much rent are you paying vs how much mortgage repayments.

IMO, it makes sense to compare the rent to the interest payments, not to mortgage repayments. Anything you pay on the top of the interest is your savings.
That said, first years interest makes the biggest part of monthly payments and the 'savings' are quite small.

This makes no sense 
Of course you need to compare mortgage payments to rent payments 
If you’re paying £1000 per month for rental over 5 years you’ll have paid 60k in rental as opposed to paying off your own mortgage 

If you pay £1000 p.m. over, say, 20 years (mortgage term), at the end you paid £240K and you own the house.

If you pay £1000 rent, you paid  £240K and own nothing.

Does this make no difference to you?

let me improve that for you:

If you pay £1000 p.m. over, say, 20 years (mortgage term), at the end you paid £240K and you own the house, but you also spent probably 1-2% pa in maintenance or £100k total over 20 years so the adjusted value is more like £140k, plus if you get unlucky house prices might have dropped in your area, so even less ...

If you pay £1000 rent, you paid  £240K and dont own the property, but you also saved the deposit, say 10% or 24k initially, so if you manage to grow that deposit (opportunity costs) at 8-9% pa you end up also around 135k in value.

So you see ... many people will tell you buying is universally the better option, but it really just depends .....

What !!!??!!

Who spends £100k in maintenance over 20 years lol

Who gets 8-9% pa returns over 20 years lol

When in the last 20 years have house prices even been the same than 20 years previously. Likely hood the house would double in value if not more lol

Also not forgetting that I've never seen or heard of anyone paying the same rent for 20 years.

There were so many holes to plug I ran out even with my 6 fingers and toes🤣🤣

simon_or

darksnake09 said:

Hi Guys,

I am in my late 20's and am very puzzled on what step to take so I home someone can shine some light.

I am looking to purchased my first time home, I know no one knows when the right time is but should I wait till the end of the year or next year and see if there is a crash in the housing market along side if interest rates come down. I am renting at the moment but it really feels like money is getting wasted.

Many Thanks !

You can time the market by luck but it's very unlikely that anyone can tell you the 'best time' to buy. For me personally, the best time to buy my own home was always yesterday.

Now that interest rates are higher than they've been for a while, house prices are expected to soften a bit. If interest rates come down, buyers will flood back into the market and prices will go up. Swings and roundabouts.

If a bank will lend you need to buy the kind of property that you're happy to live in for 5-10+ years, and you think the monthly payments are comfortably affordable, then now is as good a time as any.

Sunsaru

MultiFuelBurner said:

Sunsaru said:

MultiFuelBurner said:

Schwarzwald said:

grumbler said:

MFWannabe said:

grumbler said:

moneysaver1978 said:

darksnake09 said:

Hi Guys,

I am in my late 20's and am very puzzled on what step to take so I home someone can shine some light.

I am looking to purchased my first time home, I know no one knows when the right time is but should I wait till the end of the year or next year and see if there is a crash in the housing market along side if interest rates come down. I am renting at the moment but it really feels like money is getting wasted.

Many Thanks !

  how much rent are you paying vs how much mortgage repayments.

IMO, it makes sense to compare the rent to the interest payments, not to mortgage repayments. Anything you pay on the top of the interest is your savings.
That said, first years interest makes the biggest part of monthly payments and the 'savings' are quite small.

This makes no sense 
Of course you need to compare mortgage payments to rent payments 
If you’re paying £1000 per month for rental over 5 years you’ll have paid 60k in rental as opposed to paying off your own mortgage 

If you pay £1000 p.m. over, say, 20 years (mortgage term), at the end you paid £240K and you own the house.

If you pay £1000 rent, you paid  £240K and own nothing.

Does this make no difference to you?

let me improve that for you:

If you pay £1000 p.m. over, say, 20 years (mortgage term), at the end you paid £240K and you own the house, but you also spent probably 1-2% pa in maintenance or £100k total over 20 years so the adjusted value is more like £140k, plus if you get unlucky house prices might have dropped in your area, so even less ...

If you pay £1000 rent, you paid  £240K and dont own the property, but you also saved the deposit, say 10% or 24k initially, so if you manage to grow that deposit (opportunity costs) at 8-9% pa you end up also around 135k in value.

So you see ... many people will tell you buying is universally the better option, but it really just depends .....

What !!!??!!

Who spends £100k in maintenance over 20 years lol

Who gets 8-9% pa returns over 20 years lol

When in the last 20 years have house prices even been the same than 20 years previously. Likely hood the house would double in value if not more lol

Also not forgetting that I've never seen or heard of anyone paying the same rent for 20 years.

There were so many holes to plug I ran out even with my 6 fingers and toes🤣🤣

What happened to the other 14?? Or is that a touchy subject??

*drops mic*

MultiFuelBurner

Sunsaru said:

MultiFuelBurner said:

Sunsaru said:

MultiFuelBurner said:

Schwarzwald said:

grumbler said:

MFWannabe said:

grumbler said:

moneysaver1978 said:

darksnake09 said:

Hi Guys,

I am in my late 20's and am very puzzled on what step to take so I home someone can shine some light.

I am looking to purchased my first time home, I know no one knows when the right time is but should I wait till the end of the year or next year and see if there is a crash in the housing market along side if interest rates come down. I am renting at the moment but it really feels like money is getting wasted.

Many Thanks !

  how much rent are you paying vs how much mortgage repayments.

IMO, it makes sense to compare the rent to the interest payments, not to mortgage repayments. Anything you pay on the top of the interest is your savings.
That said, first years interest makes the biggest part of monthly payments and the 'savings' are quite small.

This makes no sense 
Of course you need to compare mortgage payments to rent payments 
If you’re paying £1000 per month for rental over 5 years you’ll have paid 60k in rental as opposed to paying off your own mortgage 

If you pay £1000 p.m. over, say, 20 years (mortgage term), at the end you paid £240K and you own the house.

If you pay £1000 rent, you paid  £240K and own nothing.

Does this make no difference to you?

let me improve that for you:

If you pay £1000 p.m. over, say, 20 years (mortgage term), at the end you paid £240K and you own the house, but you also spent probably 1-2% pa in maintenance or £100k total over 20 years so the adjusted value is more like £140k, plus if you get unlucky house prices might have dropped in your area, so even less ...

If you pay £1000 rent, you paid  £240K and dont own the property, but you also saved the deposit, say 10% or 24k initially, so if you manage to grow that deposit (opportunity costs) at 8-9% pa you end up also around 135k in value.

So you see ... many people will tell you buying is universally the better option, but it really just depends .....

What !!!??!!

Who spends £100k in maintenance over 20 years lol

Who gets 8-9% pa returns over 20 years lol

When in the last 20 years have house prices even been the same than 20 years previously. Likely hood the house would double in value if not more lol

Also not forgetting that I've never seen or heard of anyone paying the same rent for 20 years.

There were so many holes to plug I ran out even with my 6 fingers and toes🤣🤣

What happened to the other 14?? Or is that a touchy subject??

*drops mic*

Badumtisch it's just a rumour this is the county where cousins make love😳