Is now a good time to buy for FTBs

Mstty

theartfullodger said:

Buying property is a bit like getting married.  

You won't know until some years later if it was a good idea on not......

Nothing like being married for us. The house purchases, ownership and gaining of wealth has been the easier of the two lol

CSI_Yorkshire

Sarah1Mitty2 said:

theartfullodger said:

Buying property is a bit like getting married.  

You won't know until some years later if it was a good idea on not......

There are warning signs that can tell you much earlier than that, warning signs for property are now flashing red, I would advise any FTB to step away from this market until the full effect of rate rises is known.

Haven't they been flashing red in your head for more than a decade?

Sarah1Mitty2

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

More realistically, you are paying back a large debt over time.

You are paying out anyway - either serving mortgage repayments or by paying rent.  

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

and you are vulnerable to inflation/interest rate spikes in that time.

You are vulnerable to inflation in most aspects of life.  You cannot isolate yourself from that whichever route you go.  At least with a mortgage you have periods of certainty whilst any fixed rate is in place.    

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

many people won`t be able to hold on to the house now because they can`t afford the debt

That only applies to those that have sailed too close to the wind in terms of affordability.  Agreed many have been tempted to do this as, for many years, they have considered exceptionally low interest rates to be the norm.  They are now discovering that they are not.  With my first flat in the 80's I went form a mortgage payment of £300-ish an month to over £700 so I have been through it.  In my case I knuckled down to hang onto the place. 

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

"equity" won`t feature in their financial future unfortunately.

That is not necessarily true either.  I have just sold said flat for £210,000 more than I paid for it.  A nice pre-retirement windfall.

But even if circumstances for most are different and they cannot release the equity, they will still one day be in a position where they do not have monthly rent costs.  You cannot, particularly when looking at your latter years, be in a better position by paying rent.  So anyway you look at it, buying your home is an investment with considerable benefit.     

How could you possibly know what other investments people have or how much money they have to spend on rent in the future, many people with recent mortgages will still be paying the bank back as they head into retirement anyway? Blanket statements like these are the reason many people fell for the Mortgage Always Better than Rent myth and are now looking at eye watering debt costs that will hamper their ability to save for retirement for years to come.

CSI_Yorkshire

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

More realistically, you are paying back a large debt over time.

You are paying out anyway - either serving mortgage repayments or by paying rent.  

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

and you are vulnerable to inflation/interest rate spikes in that time.

You are vulnerable to inflation in most aspects of life.  You cannot isolate yourself from that whichever route you go.  At least with a mortgage you have periods of certainty whilst any fixed rate is in place.    

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

many people won`t be able to hold on to the house now because they can`t afford the debt

That only applies to those that have sailed too close to the wind in terms of affordability.  Agreed many have been tempted to do this as, for many years, they have considered exceptionally low interest rates to be the norm.  They are now discovering that they are not.  With my first flat in the 80's I went form a mortgage payment of £300-ish an month to over £700 so I have been through it.  In my case I knuckled down to hang onto the place. 

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

"equity" won`t feature in their financial future unfortunately.

That is not necessarily true either.  I have just sold said flat for £210,000 more than I paid for it.  A nice pre-retirement windfall.

But even if circumstances for most are different and they cannot release the equity, they will still one day be in a position where they do not have monthly rent costs.  You cannot, particularly when looking at your latter years, be in a better position by paying rent.  So anyway you look at it, buying your home is an investment with considerable benefit.     

How could you possibly know what other investments people have or how much money they have to spend on rent in the future, many people with recent mortgages will still be paying the bank back as they head into retirement anyway? Blanket statements like these are the reason many people fell for the Mortgage Always Better than Rent myth and are now looking at eye watering debt costs that will hamper their ability to save for retirement for years to come.

Ok then, to be more accurate:

It is unlikely for most people, in anything other than circumstances contrived purely for mathematical demonstration or a complete collapse of the economy which would likely drag down most alternative investments as well, that they will be better off paying rent which returns no equity stake in a property than by paying a mortgage which does.

Sarah1Mitty2

CSI_Yorkshire said:

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

More realistically, you are paying back a large debt over time.

You are paying out anyway - either serving mortgage repayments or by paying rent.  

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

and you are vulnerable to inflation/interest rate spikes in that time.

You are vulnerable to inflation in most aspects of life.  You cannot isolate yourself from that whichever route you go.  At least with a mortgage you have periods of certainty whilst any fixed rate is in place.    

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

many people won`t be able to hold on to the house now because they can`t afford the debt

That only applies to those that have sailed too close to the wind in terms of affordability.  Agreed many have been tempted to do this as, for many years, they have considered exceptionally low interest rates to be the norm.  They are now discovering that they are not.  With my first flat in the 80's I went form a mortgage payment of £300-ish an month to over £700 so I have been through it.  In my case I knuckled down to hang onto the place. 

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

"equity" won`t feature in their financial future unfortunately.

That is not necessarily true either.  I have just sold said flat for £210,000 more than I paid for it.  A nice pre-retirement windfall.

But even if circumstances for most are different and they cannot release the equity, they will still one day be in a position where they do not have monthly rent costs.  You cannot, particularly when looking at your latter years, be in a better position by paying rent.  So anyway you look at it, buying your home is an investment with considerable benefit.     

How could you possibly know what other investments people have or how much money they have to spend on rent in the future, many people with recent mortgages will still be paying the bank back as they head into retirement anyway? Blanket statements like these are the reason many people fell for the Mortgage Always Better than Rent myth and are now looking at eye watering debt costs that will hamper their ability to save for retirement for years to come.

Ok then, to be more accurate:

It is unlikely for most people, in anything other than circumstances contrived purely for mathematical demonstration or a complete collapse of the economy which would likely drag down most alternative investments as well, that they will be better off paying rent which returns no equity stake in a property than by paying a mortgage which does.

Unless of course you bought at the highest prices in history, highest multiples of salary in history for housing, at the lowest rates in history to take on debt, then got caught up in the fastest rate hikes in history which saw your debt repayments double, then the maths doesn`t work, you would have been financially better off in a cheap rental (quality of life, sense of "ownership" etc. are separate debates IMO if we are taking a purely financial stance)

 "Equity Stake" is another term thrown about far too loosely IMO, initially if using a mortgage you have a Debt Obligation that will last for decades, how much equity or otherwise that can be released from the property depends on many factors that you can`t really control, including when you bought, I can`t see many recent buyers having  oodles of equity can you? That was the preserve of people who bought a long time ago and got out in time."Equity Stake" was also a term used to encourage people into HTB type schemes wasn`t it, and look how that turned out?

CSI_Yorkshire

Sarah1Mitty2 said:

CSI_Yorkshire said:

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

More realistically, you are paying back a large debt over time.

You are paying out anyway - either serving mortgage repayments or by paying rent.  

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

and you are vulnerable to inflation/interest rate spikes in that time.

You are vulnerable to inflation in most aspects of life.  You cannot isolate yourself from that whichever route you go.  At least with a mortgage you have periods of certainty whilst any fixed rate is in place.    

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

many people won`t be able to hold on to the house now because they can`t afford the debt

That only applies to those that have sailed too close to the wind in terms of affordability.  Agreed many have been tempted to do this as, for many years, they have considered exceptionally low interest rates to be the norm.  They are now discovering that they are not.  With my first flat in the 80's I went form a mortgage payment of £300-ish an month to over £700 so I have been through it.  In my case I knuckled down to hang onto the place. 

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

"equity" won`t feature in their financial future unfortunately.

That is not necessarily true either.  I have just sold said flat for £210,000 more than I paid for it.  A nice pre-retirement windfall.

But even if circumstances for most are different and they cannot release the equity, they will still one day be in a position where they do not have monthly rent costs.  You cannot, particularly when looking at your latter years, be in a better position by paying rent.  So anyway you look at it, buying your home is an investment with considerable benefit.     

How could you possibly know what other investments people have or how much money they have to spend on rent in the future, many people with recent mortgages will still be paying the bank back as they head into retirement anyway? Blanket statements like these are the reason many people fell for the Mortgage Always Better than Rent myth and are now looking at eye watering debt costs that will hamper their ability to save for retirement for years to come.

Ok then, to be more accurate:

It is unlikely for most people, in anything other than circumstances contrived purely for mathematical demonstration or a complete collapse of the economy which would likely drag down most alternative investments as well, that they will be better off paying rent which returns no equity stake in a property than by paying a mortgage which does.

Unless of course you bought at the highest prices in history, highest multiples of salary in history for housing, at the lowest rates in history to take on debt, then got caught up in the fastest rate hikes in history which saw your debt repayments double, then the maths doesn`t work, you would have been financially better off in a cheap rental (quality of life, sense of "ownership" etc. are separate debates IMO if we are taking a purely financial stance)

 "Equity Stake" is another term thrown about far too loosely IMO, initially if using a mortgage you have a Debt Obligation that will last for decades, how much equity or otherwise that can be released from the property depends on many factors that you can`t really control, including when you bought, I can`t see many recent buyers having  oodles of equity can you? That was the preserve of people who bought a long time ago and got out in time."Equity Stake" was also a term used to encourage people into HTB type schemes wasn`t it, and look how that turned out?

I can see most recent buyers having equity in their property.

johnhenstock

Sarah1Mitty2 said:

CSI_Yorkshire said:

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

More realistically, you are paying back a large debt over time.

You are paying out anyway - either serving mortgage repayments or by paying rent.  

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

and you are vulnerable to inflation/interest rate spikes in that time.

You are vulnerable to inflation in most aspects of life.  You cannot isolate yourself from that whichever route you go.  At least with a mortgage you have periods of certainty whilst any fixed rate is in place.    

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

many people won`t be able to hold on to the house now because they can`t afford the debt

That only applies to those that have sailed too close to the wind in terms of affordability.  Agreed many have been tempted to do this as, for many years, they have considered exceptionally low interest rates to be the norm.  They are now discovering that they are not.  With my first flat in the 80's I went form a mortgage payment of £300-ish an month to over £700 so I have been through it.  In my case I knuckled down to hang onto the place. 

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

"equity" won`t feature in their financial future unfortunately.

That is not necessarily true either.  I have just sold said flat for £210,000 more than I paid for it.  A nice pre-retirement windfall.

But even if circumstances for most are different and they cannot release the equity, they will still one day be in a position where they do not have monthly rent costs.  You cannot, particularly when looking at your latter years, be in a better position by paying rent.  So anyway you look at it, buying your home is an investment with considerable benefit.     

How could you possibly know what other investments people have or how much money they have to spend on rent in the future, many people with recent mortgages will still be paying the bank back as they head into retirement anyway? Blanket statements like these are the reason many people fell for the Mortgage Always Better than Rent myth and are now looking at eye watering debt costs that will hamper their ability to save for retirement for years to come.

Ok then, to be more accurate:

It is unlikely for most people, in anything other than circumstances contrived purely for mathematical demonstration or a complete collapse of the economy which would likely drag down most alternative investments as well, that they will be better off paying rent which returns no equity stake in a property than by paying a mortgage which does.

Unless of course you bought at the highest prices in history, highest multiples of salary in history for housing, at the lowest rates in history to take on debt, then got caught up in the fastest rate hikes in history which saw your debt repayments double, then the maths doesn`t work, you would have been financially better off in a cheap rental (quality of life, sense of "ownership" etc. are separate debates IMO if we are taking a purely financial stance)

 "Equity Stake" is another term thrown about far too loosely IMO, initially if using a mortgage you have a Debt Obligation that will last for decades, how much equity or otherwise that can be released from the property depends on many factors that you can`t really control, including when you bought, I can`t see many recent buyers having  oodles of equity can you? That was the preserve of people who bought a long time ago and got out in time."Equity Stake" was also a term used to encourage people into HTB type schemes wasn`t it, and look how that turned out?

You keep spouting this non-sense. See my
previous post where you asked someone to “imagine” buying at the height of the market, as you did in this post. I answered you with a non-fictive case that’s exactly your nightmare scenario: buying at the peak of the market, extremely low interest rates, 2 years fixed instead of five and so on.

Address my post or stop talking about things you have no clue about.

RelievedSheff

johnhenstock said:

Sarah1Mitty2 said:

CSI_Yorkshire said:

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

More realistically, you are paying back a large debt over time.

You are paying out anyway - either serving mortgage repayments or by paying rent.  

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

and you are vulnerable to inflation/interest rate spikes in that time.

You are vulnerable to inflation in most aspects of life.  You cannot isolate yourself from that whichever route you go.  At least with a mortgage you have periods of certainty whilst any fixed rate is in place.    

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

many people won`t be able to hold on to the house now because they can`t afford the debt

That only applies to those that have sailed too close to the wind in terms of affordability.  Agreed many have been tempted to do this as, for many years, they have considered exceptionally low interest rates to be the norm.  They are now discovering that they are not.  With my first flat in the 80's I went form a mortgage payment of £300-ish an month to over £700 so I have been through it.  In my case I knuckled down to hang onto the place. 

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

"equity" won`t feature in their financial future unfortunately.

That is not necessarily true either.  I have just sold said flat for £210,000 more than I paid for it.  A nice pre-retirement windfall.

But even if circumstances for most are different and they cannot release the equity, they will still one day be in a position where they do not have monthly rent costs.  You cannot, particularly when looking at your latter years, be in a better position by paying rent.  So anyway you look at it, buying your home is an investment with considerable benefit.     

How could you possibly know what other investments people have or how much money they have to spend on rent in the future, many people with recent mortgages will still be paying the bank back as they head into retirement anyway? Blanket statements like these are the reason many people fell for the Mortgage Always Better than Rent myth and are now looking at eye watering debt costs that will hamper their ability to save for retirement for years to come.

Ok then, to be more accurate:

It is unlikely for most people, in anything other than circumstances contrived purely for mathematical demonstration or a complete collapse of the economy which would likely drag down most alternative investments as well, that they will be better off paying rent which returns no equity stake in a property than by paying a mortgage which does.

Unless of course you bought at the highest prices in history, highest multiples of salary in history for housing, at the lowest rates in history to take on debt, then got caught up in the fastest rate hikes in history which saw your debt repayments double, then the maths doesn`t work, you would have been financially better off in a cheap rental (quality of life, sense of "ownership" etc. are separate debates IMO if we are taking a purely financial stance)

 "Equity Stake" is another term thrown about far too loosely IMO, initially if using a mortgage you have a Debt Obligation that will last for decades, how much equity or otherwise that can be released from the property depends on many factors that you can`t really control, including when you bought, I can`t see many recent buyers having  oodles of equity can you? That was the preserve of people who bought a long time ago and got out in time."Equity Stake" was also a term used to encourage people into HTB type schemes wasn`t it, and look how that turned out?

You keep spouting this non-sense. See my
previous post where you asked someone to “imagine” buying at the height of the market, as you did in this post. I answered you with a non-fictive case that’s exactly your nightmare scenario: buying at the peak of the market, extremely low interest rates, 2 years fixed instead of five and so on.

Address my post or stop talking about things you have no clue about.

It's all just sour grapes from Crashy.

MEM62

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

More realistically, you are paying back a large debt over time.

You are paying out anyway - either serving mortgage repayments or by paying rent.  

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

and you are vulnerable to inflation/interest rate spikes in that time.

You are vulnerable to inflation in most aspects of life.  You cannot isolate yourself from that whichever route you go.  At least with a mortgage you have periods of certainty whilst any fixed rate is in place.    

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

many people won`t be able to hold on to the house now because they can`t afford the debt

That only applies to those that have sailed too close to the wind in terms of affordability.  Agreed many have been tempted to do this as, for many years, they have considered exceptionally low interest rates to be the norm.  They are now discovering that they are not.  With my first flat in the 80's I went form a mortgage payment of £300-ish an month to over £700 so I have been through it.  In my case I knuckled down to hang onto the place. 

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

"equity" won`t feature in their financial future unfortunately.

That is not necessarily true either.  I have just sold said flat for £210,000 more than I paid for it.  A nice pre-retirement windfall.

But even if circumstances for most are different and they cannot release the equity, they will still one day be in a position where they do not have monthly rent costs.  You cannot, particularly when looking at your latter years, be in a better position by paying rent.  So anyway you look at it, buying your home is an investment with considerable benefit.     

How could you possibly know what other investments people have or how much money they have to spend on rent in the future, many people with recent mortgages will still be paying the bank back as they head into retirement anyway? Blanket statements like these are the reason many people fell for the Mortgage Always Better than Rent myth and are now looking at eye watering debt costs that will hamper their ability to save for retirement for years to come.

You seem strongly opposed to the idea of buying your own home, despite the fact that, for most, it is beneficial in the long term.  As for my blanket statement, that would also prove to be the case for the majority of people.  We do not need to know what other investments people have to know that their retirement provision needs to be significantly higher in order to generate the extra income needed to cover rent.  Therefore regardless of what they may or may not have, it hold true for the majority.        

Herzlos

Sarah1Mitty2 said:

CSI_Yorkshire said:

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

More realistically, you are paying back a large debt over time.

You are paying out anyway - either serving mortgage repayments or by paying rent.  

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

and you are vulnerable to inflation/interest rate spikes in that time.

You are vulnerable to inflation in most aspects of life.  You cannot isolate yourself from that whichever route you go.  At least with a mortgage you have periods of certainty whilst any fixed rate is in place.    

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

many people won`t be able to hold on to the house now because they can`t afford the debt

That only applies to those that have sailed too close to the wind in terms of affordability.  Agreed many have been tempted to do this as, for many years, they have considered exceptionally low interest rates to be the norm.  They are now discovering that they are not.  With my first flat in the 80's I went form a mortgage payment of £300-ish an month to over £700 so I have been through it.  In my case I knuckled down to hang onto the place. 

Sarah1Mitty2 said:

MEM62 said:

Sarah1Mitty2 said:

MEM62 said:

tbo127 said:

Is now a good time to buy for first time buyers given the falling property prices? 

If not now then when?  

If you need somewhere to live you can either buy or rent.  The former is an investment, the latter isn't.    

It isn`t really, it is a highly illiquid  (and for many people now a highly leveraged) asset that is very difficult to sell in property downturns/crashes and you can lose your deposit and also go into negative equity where you would need the banks permission to sell, and if borrowing mortgage debt you are exposed to interest rate fluctuations for decades (you can fix but not for the full term of the mortgage) You can walk away from a rental, you can`t walk away from a mortgage debt.

Of course it is.  It gains equity over time and eventually places you in a position where you are not paying either mortgage or rent.  For many, it will be one of the best investments that they make.  The argument that being illiquid and not easily disposable means that it is not an investment just does not hold water.  Not every investment you make needs to be liquid.    

Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment?  Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?    

"equity" won`t feature in their financial future unfortunately.

That is not necessarily true either.  I have just sold said flat for £210,000 more than I paid for it.  A nice pre-retirement windfall.

But even if circumstances for most are different and they cannot release the equity, they will still one day be in a position where they do not have monthly rent costs.  You cannot, particularly when looking at your latter years, be in a better position by paying rent.  So anyway you look at it, buying your home is an investment with considerable benefit.     

How could you possibly know what other investments people have or how much money they have to spend on rent in the future, many people with recent mortgages will still be paying the bank back as they head into retirement anyway? Blanket statements like these are the reason many people fell for the Mortgage Always Better than Rent myth and are now looking at eye watering debt costs that will hamper their ability to save for retirement for years to come.

Ok then, to be more accurate:

It is unlikely for most people, in anything other than circumstances contrived purely for mathematical demonstration or a complete collapse of the economy which would likely drag down most alternative investments as well, that they will be better off paying rent which returns no equity stake in a property than by paying a mortgage which does.

Unless of course you bought at the highest prices in history, highest multiples of salary in history for housing, at the lowest rates in history to take on debt, then got caught up in the fastest rate hikes in history which saw your debt repayments double, then the maths doesn`t work, you would have been financially better off in a cheap rental

Assuming of course that the cheap rental is of a similar standard to the mortgaged house, and the cheap rental hasn't launched up in price as well?

Any time I've looked, rent has been significantly more than a mortgage, and if you're paying any capital back on the mortgage then after 20-30 years you get to stop paying once it's cleared. Even ignoring equity entirely, over the longer term the mortgage is a better idea.

As for over-extending and buying at peak before rates flew up, that definitely sucks and will force some people to downsize, but to most of them it's going to be largely irrelevant in 20 years time.

When I bought just before the 2008 crash I was in about £30k negative equity almost immediately, but I sold it recently with £70k positive equity. Had I rented the same thing I'd have paid out twice as much and got nothing back on it.